Sales Force Management involves more than just setting revenue targets and insisting on the accomplishment of such targets by the sales force. An organization has to make plans regarding sales, distribute the revenue targets effectively, measure the performance of individuals, and motivate them appropriately. Managing these activities individually can pose some difficulties for sales managers in identifying the deficiencies in performance.

Here comes the relevance of SAP Sales Performance Management (SAP SPM).

What is Sales Performance Management (SPM)?

Sales Performance Management (SPM) refers to planning, controlling, measuring, and enhancing the performance of sales agents and teams. SPM aims at assisting an organization to meet its sales goals through various sales goals, measurements, and incentives.

The Sales Performance Management module of SAP offers a variety of solutions to issues regarding various aspects of sales performance management such as territory management, quota management, incentive calculations, and agent performance measurement.

For instance, an organization may set up quarterly sales goals for its sales team. These sales goals will then be distributed among the sales agents, and their performance may be measured and commission paid according to their performance.

The purpose is to ensure that the sales agents know what is expected of them and that they receive appropriate support and incentives for their job.

Sales Performance Management

The problems that companies may face due to the lack of performance management process include unrealistic sales targets, wrong calculation of sales commission, unfair allocation of sales territories, and inability to see how well the employees perform.

Good sales performance management system helps the companies in:

• Increasing the Efficiency of Sales: By helping salesmen to set goals and analyzing the performance, it makes them focus on their key areas of work.
• Ensuring Accountabilities: The employees know their responsibilities and what they need to achieve.
• Planning: With the help of previous data of performance and market information, the managers can set realistic sales targets.
• Motivation: By incentive programs, the employees are motivated towards achieving the organizational goals.

SAP SuccessFactors Sales Performance Management - Important Solution Areas

The SAP SuccessFactors Sales Performance Management consists of three important solution areas, which include different functions of sales performance management.

1. SAP SuccessFactors Territory and Quota

The SAP SuccessFactors Territory and Quota is an application that helps in territory design, responsibility assignment, quota assignment, and sales opportunity balancing.

Companies may use the following features through this solution:

• Designing the sales territories.
• Assignment of customer accounts to the sales representatives.
• Assignment of sales quotas to the sales teams.
• Sales territories balancing considering potential and workload.
• Quota analysis and sales opportunities.

For example, a company having business in multiple regions may set different targets depending upon the potential of the territories.

2. Incentive Management in SAP SuccessFactors

The definition of Incentive Management is that it is a system of computing and controlling commissions, bonuses, and other types of performance-based compensation.

An enterprise is able to design a rewards plan depending on its income, product sale, profits, or individual accomplishments.

The major features of Incentive Management are:

• Creating an incentive compensation program.
• Computing commissions automatically.
• Controlling compensation rules and rates.
• Tracking employee income.
• Analyzing incentive payments.

It makes calculations easier, more precise and provides analysis of incentives awarded to sales representatives.

3. SAP SuccessFactors Agent Performance Management

Agent Performance Management addresses the needs of organizations that have agent-based sales or service processes. It provides assistance to companies in maintaining central information about agents, on-boarding of agents, and managing agent-related performance and incentive processes.

Features include:

• Central information about agents.
• Agent on-boarding process.
• Agent performance management.
• Administration of incentives.
• Process management for the agent life-cycle.

It is a relevant solution for organizations having a large number of agents and multiple distribution channels.

How Do All of These SAP Solutions Work Together?

The different areas of SPM solutions are created to cover connected processes in sales performance management.

Let us consider an example of a company that should improve its sales revenue each quarter.

First, Territory and Quota helps in arranging sales territories and assigning goals to representatives according to the sales potential and requirements of the company.

Second, Incentive Management is used for commissions and bonuses calculation according to certain compensation plans and sales results.

On the other hand, Agent Performance Management is useful for companies that use the services of agents.

All of these solutions cooperate in order to provide sales planning, performance management, and incentive management.

Also, the Sales Cloud solution from SAP will help in these processes by using customer interactions and sales execution management.

What are the Business Advantages of SAP SPM?

A well-functioning sales performance management tool can help the company to have some business advantages like the following:

Sales objectives alignment with business objectives.

• Visibility on the performance of an individual or team.
• Balanced territory and quota.
• Calculation of the incentive accurately.
• Reduced administration by automation.
• Weaknesses identification in the sales performance.
• Motivation and sales accountability.

All the above aspects will help the company in managing increased sales teams.

Conclusion

The SAP Sales Performance Management tool will assist organizations in managing sales planning, territory planning, quota planning, incentive management, and agent performance with connected solution areas.

Through knowing how SAP SuccessFactors Territory and Quota, Incentive Management, and Agent Performance Management work together, companies can come up with a more organized way of managing sales performance.

Those individuals who are keen on knowing about the business process and SAP tools may find SPM useful.

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