Incentive Compensation and Sales Performance Management Survey

Monthly Archive for September, 2008

ZS Associates’ Javelin Incentive Manager - Part 1

Published
by
admin
on September 29, 2008
in Industry News and Vendor / SPM Solution Review and Info
. 0 Comments
1 Star2 Stars3 Stars4 Stars5 Stars (6 votes, average: 3.33 out of 5)
Loading ... Loading ...

In this post I will describe what I have seen and my impressions of the Javelin Incentive Manager. When logging in, as could be expected, the user is greeted by some message. From there, the user is able to access the Incentive Manager or many of the other modules I will cover in a separate post.

When selecting “Incentive Manager”, the administrator can see or create a new scenario. The demo was for the on-demand version of the application, so each environment (modeling, development, production, etc) where all located on the same server. These environments are only distinguished by a “scenario”. Xactly also uses this concept of scenario, but it is limited to their modeling environment.


When selecting an existing scenario, the different plans and components are displayed.


All of the plan logic is component-based instead of being rule-based. It seems like most solutions I have seen (except Centive and Merced Systems) follow a rule-based approach: credit rules generate credits, some measurement rules aggregate and transform the credits, and finally the commission rules transforms the credits into a commission amount. Javelin Incentive Manager uses a completely different approach which is based on components and workflows. The plans are built by assembling those components. This component approach appears to be very similar to the Informatica ETL interface.

Each component is reusable from workflow to workflow, and can easily be added and named appropriately.

Selecting a component will show its details, which can be edited on the same screen:

Another feature I liked from Javelin Incentive Manager is the ability to look directly at the output of any component once the results are processed. I’m sure this makes troubleshooting and debugging much easier! The component also shows in a different color of a modification caused the results to be out-of-date – this means it’s time to re-process the batch to get updated results if required.

Quick-Start

Future versions of Javelin Incentive Manager will have a “wizard” called Quick Start to create common workflow structures without even having to add components individually. This feature is already in beta testing. I haven’t actually seen it in action, but it looks good.

More about ZS Javelin Incentive Manager coming in my next post…

Tags: , , , , , , , , ,

Related Posts:
ZS Associates
ZS Associates’ Javelin Suite Additional Modules

ZS Associates… Who are those strangers?

Published
by
admin
on September 28, 2008
in Industry News and Vendor / SPM Solution Review and Info
. 0 Comments
1 Star2 Stars3 Stars4 Stars5 Stars (5 votes, average: 3.6 out of 5)
Loading ... Loading ...

As I noted in a previous post, a “new” SPM company made the latest Gartner’s Market Scope 2008 list; ZS Associates. I heard about ZS before when I read a great incentive compensation book called “How to Design and Implement Plans That Work – The Complete Guide to Sales Force Incentive Compensation” written by ZS’ co-founders and a consultant. Maybe I’m guilty of reading the book too quickly, but what I had not realized is that ZS Associates actually created their own sales performance management application, which they call the Javelin Software Suite.

After digging a bit deeper, I learned that ZS Associates is a consulting company based in Illinois, with a strong focus on the pharmaceutical industry. The Javelin suite is offered both on-premise and on-demand. Javelin Incentive Manager is built to handle complex plans requiring a lot of flexibility, and is attractive to organizations with a sales force of 5oo to 10,000 individuals. Many additional modules are available including a territory designer, a quota designer, and an MBO manager (Management by Objectives).

I scheduled a call with several ZS Associates employees to get a demo of their applications. I will dedicate a post to describe the Javelin Incentive Manager, and another one to discuss some of the other modules I have seen.

Back to business… I asked this group why I hadn’t heard about Javelin before – I haven’t exactly been hiding under a rock… However I have never been involved on a life sciences project yet and this may be why I hadn’t heard about their solution. The historical focus for the Javelin application has been on life sciences, and its flexibility has made it a good fit for complex requirements of that vertical. However, the application is not life sciences specific by any mean, and it’s really a change in strategy that pushed ZS to be more proactive at marketing the Javelin Incentive solution to the high tech, insurance / financial services, and manufacturing industries.

Unlike other software vendors, ZS is a consulting firm with a product, more than a vendor with some consultants. Incentive compensation is their largest practice area and they have about 200 consultants dedicated to compensation related projects. Because the company is much larger than a typical vendor, and since they focus a lot on consulting, their workforce is spread across 17 offices in 10 countries. As could be expected, and as they confirmed, having offices close to their customers makes a big difference. ZS also has an office in India with more than 100 consultants, which it plans to expand to over 250 consultants in the next 3 years.

In my next post I will review the Javelin Suite, based on the extensive demonstration I received last week.

Tags: , , , , , , , , ,

Related Posts:
ZS Associates
MarketScope for Sales Incentive Compensation Management Software 2008

Lehman Brothers, Dilbert and a Lesson on Motivation

Published
by
admin
on September 25, 2008
in Miscellaneous
. 1 Comment
1 Star2 Stars3 Stars4 Stars5 Stars (5 votes, average: 3.8 out of 5)
Loading ... Loading ...

Since I talked about Lehman Brothers in my last post, it seemed appropriate to share a recent Dilbert cartoon.  If you think that reading Dilbert cartoons is very “geeky”, reading it on an incentive blog is probably worse.  I actually saw the cartoon on Paul Hebert’s Incentive Intelligence blog.

Why is Dilbert’s boss wrong about “motivation and fear being the same thing?  To quote Paul:

In the short-term, fear will do wonders - but the long-term impact is very bad - turnover, lack of positive company culture, recruiting problems - you name it.

Tags: , , , , ,

Related Posts:
Is (Incentive) Compensation a Villain Of the Credit Crisis
A Lesson on Motivation at the Elephant Nature Park

Is (Incentive) Compensation a Villain Of the Credit Crisis

Published
by
admin
on September 23, 2008
in Industry News and Miscellaneous
. 4 Comments
1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 3 out of 5)
Loading ... Loading ...

Is Compensation a Villain Of the Credit Crisis is the title of a recent post on the US Banker website.

“While compensation was not THE cause of the current credit crises it certainly can be viewed as a significant contributor.”

The idea is that today, bank’s incentive compensation plans are mostly based on the current year’s revenues.  However, most trading profits are from revenue streams spanning multiple years.

The authors recommendation is to audit incentive plans to identify and remove features that incent short-term behavior.  He also makes several other recommendations including:

  1. Executives should have significant personal capital at risk
  2. Current cash and long-term reinvestment in the firm should match the firms’ lines of businesses generating its profit
  3. Take back incentives if deals do not go through (only incent when actual profit is made)
  4. Ensure executives understand and take risk ownership
  5. Measure performance for the entire firm
  6. Develop talent from within and build a long-term culture.

Not bad ideas, but I’m sure financial institutions have many very smart people considering this as well.

When I read this article, I was wondering, could compensation really have a significant role in the credit crisis?

Investment bankers earn a lot of money…  A lot of people in the financial sector receive (received?) huge bonuses.  But let’s take for example Lehman Brothers.  In 2006, along with many other investment banks, Lehman Brothers had a stellar year: it paid its average employee $335,441 and reported a fourth-quarter profit of 1 billion.   This is after of course, paying 8.87 billion in salary to its 26,000 employees.  Goldman Sachs has even more ridiculous figures; it paid its 26,400 staff an average of $622,000.  Two years later, Lehman files for bankruptcy.

So, how much can we blame “crazy” compensation versus bad risk management?  I’m not a financial analyst, and I’m not pretending to understand the entire issue…  However it seems logical that a firm such as Goldman Sachs, who paid almost twice as much in average compensation in 2006, should be hit equally hard by the credit crisis as another firm such as Lehman Brothers, if compensation was such a major factor.

Goldman Sachs Performance

Goldman Sachs Performance

It turns out that while Goldman Sachs was affected by the credit crisis, it is not in such a bad shape…  despite having paid its employees more.  And this proves that…  the credit crisis is a very complex problem, and that maybe, maybe compensation is not such a “significant” contributor to the credit crisis.

Tags: , , , , , , ,

Related Posts:
Visa’s approach to Incentive Compensation
Sales Performance Management Glossary

Last Monday, TN Visa and why I hate bureaucracy

Published
by
admin
on September 20, 2008
in Miscellaneous and Uncategorized
. 7 Comments
1 Star2 Stars3 Stars4 Stars5 Stars (2 votes, average: 3.5 out of 5)
Loading ... Loading ...

Being Canadian, but often working in the US, I need what is called a TN status (often called a TN visa). This TN status is what allows Americans, Canadians and Mexicans to work in Canada and in the US, and needs to be renewed annually.

The TN status is only given to people falling under certain job categories (for me “systems analyst”), with a degree and experience in that discipline. Other documents are required when applying, such as the job offer and salary, the company’s background, usually a letter explaining the contract is for one year and outlining the experience of the person, and a resume.

For Canadians, this TN status application is actually done at the “port of entry”. In other words, it needs to be applied for on the same day as the flight, at the US customs, at the airport (unless of course one is driving across the border). The customs are AFTER security, which also means a boarding pass for the US is required.

As I mentioned before, I started a new job about 2 months ago. Last Monday was my first visit to the US since I started the new job and I needed a new TN visa. This is not my first visa and I know the drill… show up at the airport several hours before the flight and have all ORIGINAL documents in hand along with a COPY of these documents for them to keep.

After waiting for about an hour, the custom officer calls me in the little office and tells me: “You probably have a good idea by now, but we have a problem”. And I’m thinking “that’s not good…”. She goes on “the job description in the offer letter does not match the job description of a systems analyst as defined in the NAFTA act. Sign here to withdraw your TN status application, I will escort you out of the secure area, and come back once you have updated your offer letter.”

Too bad I missed my flight and could not get on another one before the next day. Too bad the officer could not read between the line of my job description and realize that my duties were those of a systems analyst. Too bad she did not think it was ok to let me fly for my 2 day meeting. Too bad that the immigration lawyer my company used did not realize there would be a problem. At least Air Canada was nice about it and let me reschedule my flight at no additional cost.

The next morning, I was back at the airport at 4:30 am with an updated job offer in hand, and I got my TN status without any problems. I’m good for another year.

A few tips for those applying for their TN visa:

  • Don’t forget any of the required documentation I mentioned.
  • Bring a pay stub. Apparently they care to find out the method of payment.
  • If you are in my situation and you were on another TN status before starting a new job/contract, make sure you can prove the end date of the last job and the start date of the new job so they don’t think you may have worked for the new job on the old TN visa.
  • Method of payment can usually be a credit card (many places on the web say cash only).
  • Don’t trust any immigration lawyer. You can find more info and tips on getting a TN status here. Make sure all the supporting documentation describes job duties as per that NAFTA job description.

Tags: , , ,

Related Posts:
Visa’s approach to Incentive Compensation
Monday Evening Humor on Competition

Crappy Incentive Plan

Published
by
admin
on September 17, 2008
in Case Studies, Industry News and Miscellaneous
. 2 Comments
1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5 out of 5)
Loading ... Loading ...

I came across this article and I just couldn’t resist sharing it.

City uses DNA to fight dog poop

“An Israeli city is using DNA analysis of dog droppings to reward and punish pet owners.”  Dog owners will have their dogs swabbed for DNA, which will then be used to match droppings to the dog and its owners. 

 Owners using special bins to dispose of the droppings will be rewarded food coupons and dog toys.  Droppings found in the street will result in a fine.  This sounds like a pretty good incentive program. 

The question is, when all is said and done, would the cost of rewarding the behavior (maintaining DNA info, dealing with disputes, collecting DNA from droppings, etc) outweigh the cost of simply cleaning the street?  Maybe that depends if the new behavior of picking up dog poop can be permanent once the reward is removed to leave only the fine approach.

I look forward to finding out if the program is successful after its 6 month trial.  If it is successful, how about we collect DNA from everyone on the planet and fine anyone leaving chewing gum and cigarettes on the street?

Tags: , , , , ,

Related Posts:
Worst Union Leader in the World and OC Transpo’s Strike
Varicent Insight 2009