When is Being Late, Too Late?

When is being late, too late?  Sometimes being late is a good thing. Like, when you're late for a movie with your spouse that you really didn't want to see only to discover it is sold out.  Or, when you're late for a flight only to find out it is delayed anyway. Sometimes, however, being late can have severe, short term effects.

For instance, when Joe, the "only" person who manages all the formulas and rules for your variable incentive compensation plans (and has been since Moses was a child) wins the lottery and decides it is way past his time to live the good life and quits via email, being late on installing an Incentive Compensation Management (ICM) platform may be too late to prevent any short term damage to the organization.

While it may appear that adding a hard cost to a function that is being "adequately" performed today with existing time, tools and talent (see related Post) is adding unnecessary burden to the expense side of the profit equation, consider the following:

• What is the cost of replacing your top salesperson because you underpaid them by just enough to bounce their mortgage payment?
• What is the cost in time and money to replace Joe with someone new vs. having someone already crossed trained on a common platform?
• What is the cost of under/over reporting accruals?
• What is the cost of overpaying or underpaying salespeople.  Gartner Group says at least 2%.- Joe Galvin, Sales ICM Systems: Ready for Prime Time, Gartner Research
  
• What is the cost of losing in litigation because you couldn't prove the accuracy of your compensation or the acceptance of the plan by the "litigant" - that former employee who just six months ago was your awarded your company's MVP award.

If a viable alternative to the risk of "individual memory" were to add just 1% or less to your cost of sales or bonus incentives and provide you with SOX level compliant processes, controls and reporting, isn't it worth investigating?

Is there a "Joe" in your organization?