Your guide to increase Implementation and Change Management RoI

Businesses are constantly evolving due to changing market environment and highly competitive landscape. This has introduced several complexities leading growing organizations to move from excel workbooks, home-grown legacy systems and implement new-age solutions or to make changes to existing ones to reduce the significant amount of manual time spent in managing exceptions. Research has proven that there is 88% chance of errors using excel spreadsheets. This has led businesses to evaluate enterprise grade solutions.

Over the past few years, we noticed that organizations have a highly myopic view about investing in implementations or automation through change management. That, however has started changing and that is leads me to write about 5 key metrics to focus on while implementing any enterprise grade solution or upgrading existing ones through a well-thought through change management process. Through the article, I will use examples specific to Incentive or Sales Compensation space; however, the over-arching message applies to any sort of implementation or change management process. Here we go then with the list of 5 metrics you want to focus upon;

1. Turnaround Time Reduction - This is the total time needed from start to closure of a request. Let’s look at the refinement part of the target setting or the goal setting process as an example. It starts from pushing the set quotas to the highest level and allowing sales leadership to adjust quotas for their reporting reps/managers. Finalized quotas are then pushed to the Sales Operations team for final review which are then used in IC calculation. On an average this process takes anywhere between a week to couple weeks.

An effective IC solution should automate the end-to-end process and enable sales operations teams and other stakeholders to manage processes with the click of a button. Automation of manual validations, built-in detailed reports and access to timely insights and visualization can reduce the entire process time significantly and release payouts sooner to the field.

2. Manual Efforts Reduction - These are the total number of manual hours spent by an individual behind fulfilling a request. If we look at the quota refinement example from above, there are various manual tasks that entail data formatting, exception handling and resulting adjustments, data and dispute follow ups etc. These peripheral tasks increase the overall resource needs as well the processing time. For a monthly payroll cycle, this is how the math looks like;

Good IC system should help you significantly reduce these manual efforts. Organizations should invest these saved hours in value add activities that otherwise may be pushed out because of lack of bandwidth.

3. Manual Touchpoints Reduction - Ideally, each step involved in the process should require a lesser number of resources. As multiple individuals touch specific steps/processes manually, the chances of errors go up significantly translating to a dollar amount loss. An out-of-the-box IC solution that enables end-to-end automation and comes in with built-in workflows eliminates redundant touchpoints.

4. Payout Error Reduction / Dollar Savings - A solution is primarily implemented by an organization to optimize their resources' bandwidth and utilize it in better way or to eliminate monetary leakages. Research has proven that legacy solutions and excel workbooks lead to overpayments of around 3% to 8%; typically attributed to formulae errors and manual interventions. As an example, for a salesforce of 100 reps who are eligible for sales incentives of $36K per year, your organization is at a risk of overpaying and causing indirect losses of anywhere between 100K to 300K per year.

5. Total Cost of Ownership Reduction - The COVID pandemic has taught there is going to be an ongoing need of tweaking plans, plan parameters, quota refinement, and simulation of varying scenarios outside regular annual plan changes. As per research, an organization spends $1500 per participant to administer these plans and associated changes. For a salesforce of 100 reps, this translates to 150K which at times exceeds the actual cost of the solution. On similar lines, myriad of solutions; be it a CRM or a billing solution or one for inventory management system or anything and everything you can think have administrative overhead in terms of money, resources and time (both; effectively money).

Organizations need to look at a holistic set of metrics like the ones above while implementing new solutions or making changing through existing ones. In addition, it is equally important to understand the costs that are going to be incurred for ongoing operations and change management. The fact is that the cost incurred managing the solution hurts the most not only because of cash outflow but also because of valuable time that goes in managing day-to-day operations instead of understanding trends, patterns, and turning ideas into innovation.