Define: Payments

In the Payment Overview, you can create new payment rules, edit existing payment rules, or delete payment rules. From the task pane on the left side of the screen, select a specific payment rule name to edit an existing payment rule.

To get to Define Payments, you will need to be in Express:

1. Plans > Edit Plan
2. Select a plan
3. Click on "4. Define Payments"

In order to payout a rep(s), first, you must Define Credits. No payment, without credit. Sales Comp 101 will help review the steps needed to help refresh on the steps compensation is broken down into.

New Payment Rule: To add a new payment rule to a plan, click the Create New link in the task pane. If you have opened a payment rule, you can click delete this payment to delete the rule. You will receive a warning to confirm the deletion before the rule is deleted.

Section A - Payment Rule Name

In Section A - Payment Rule Name, the name you enter will appear on Reports and Dashboards, so be sure to be as clear, concise, and descriptive as possible.

NOTE: It is recommended for each plan, per fiscal year, you label it with the year i.e. Sales Rep 2020 Plan

Payment Description: You can add a Payment Description that will appear on Documents within Express to add even more detail about a specific payment rule.

Payment Category: You have the option to choose a Payment Category (i.e. Commission or Bonus) based on the Payment Categories that have been established in Setup > Payment Categories.

Budget Amount: You can enter your company’s total budgeted amount for this Payment Rule in the Planned Spend field. This should be the sum total for all People/Payees that qualify for this Payment Rule.

Section B – How Would You Like To Pay People? 

In Section B – How Would You Like To Pay People? you will define if payments will be made as a % per deal, a flat amount per unit, or a lump sum. Payments will be applied to the result of the associated credit rule that was built in a previous step.

For example purposes, we'll assume we've built a credit rule that has the net result of $100,000 and 20 units sold:

• Commission (% rate per deal): A specific percentage will be applied to the net result of the Credit rule that was built.  Remember that the Credit rule contains the filters for specific deals, the mathematical operation (sum vs count), and the attribute being used. 
  For example, if a commission rate of 5% is defined the math used will be 5% * $100,000 = $5,000 Commission.
• Commission (amount per deal): An amount will be applied to the net result of the Credit rule that was built. The type of Payment will allow you to multiply a flat amount by a quantity or other numeric field from the deal.
  For example, if a commission rate of $10 is defined, the math used will be $10 * 20 units = $200 Commission.
• Bonus (lump sum): A specific amount is paid out when a level of attainment is achieved. 
  For example, if a bonus is defined that once over quota, a bonus of $5,000 will be paid, and assuming the corresponding quota is $75,000, the % to quota will be 133%, therefore the quota as achieved and $5,000 will be paid out.

Section C – Which Credit Is Used As Part Of The Payment?,

In Section C – Which Credit Is Used As Part Of The Payment?, you will select the Credits that will be used to create the payment. Credits can be defined in Plans > Edit Plan > Define Credits. If a Quota has been Defined Define: Quota and is associated with a Credit Rule, it will display to the right of the drop-down list. You also can select whether the Quota is part of the payment rule or not.

Section D – Select Timeframe for Attainment

In Section D – Select Timeframe for Attainment, you will select how frequently attainment levels are reset. Attainment frequencies relate to quotas that are built and determine which value within the quota should be referenced in correlation to the payment.

Options include:

• Monthly: The attainment is reset every month utilizing the monthly quota amount for attainment.
• Quarterly: The attainment is reset every quarter utilizing the quarterly quota amount for attainment.
• Annual: The attainment is reset every year utilizing the annual quota amount for attainment.
• Quarter-to-Date (Monthly): The attainment is cumulative monthly throughout the quarter and resets quarterly.
• Year-to-Date (Monthly): The attainment is cumulative monthly throughout the year and resets annually.
• Year-to-Date (Quarterly): The attainment is cumulative quarterly throughout the year and resets annually.

Another way to look at the breakdown is (to see a larger image, right-click > Open Image in New Tab):

Section E – How Frequently Do You Pay This Payment

In Section E – How Frequently Do You Pay This Payment, you will select how often payments will be made to the users. Although commissions will be calculated monthly, payments can be paid less frequently.

Options include:

• Monthly: Once per month
• Quarterly: Once per quarter
• Annually: Once per year
• On Multiple Events: If commissions are earned at calculation and paid out at a later date, a schedule can be defined. These are defined by four Types of Holds.

Section F – Define Payment Structure

In Section F – Define Payment Structure, you will determine how to measure success on the payment. This may either be based on the attainment of a quota, for which you must pick the quota, or as an explicit threshold.

• Percent attainment of quota: This drives payment by percent attainment of quota by comparing the sum of the value for the deals indicated on the associated measure to a quota. The payment grid is constructed based on the tiers needed for the varying rates.
• Explicit threshold: In this case, payments are driven by evaluating tiers on a value other than quota attainment. This value could be an amount, quantity, number of units sold, etc.
• Apply the Highest Rate: If checked, the payment rule will now payout to the rep at the higher rate if met. See Apply the Highest Rate guide for more details.  

The next step in building payment rules is to Build a Rate Table.