Transformative Impact of Automating Incentive Compensation in the Life Sciences...

We are witnessing life sciences industry being transformed by innovations and new emerging technologies to provide advanced therapies that offer potential breakthroughs for previously untreatable disease. Precision medicine paves the way to medical treatments tailored to the individual characteristics of each patient enabling more effective treatments. Digital health is revolutionizing the industry, and this includes wearable devices, health tracking apps, and remote patient monitoring, all of which lead to more personalized care to improve patient outcomes.

The sales workforce needs to stay updated with these rapidly evolving advancements while the market is a competitive environment with often complex sales processes and high turnover. It is a strategic investment for life science companies to invest in their most valuable asset - their people.  Sales Performance Management (SPM) solutions from SAP stand as a pivotal factor to drive employee motivation and loyalty.

During the recent 2024 North America Dallas SPM Customer Summit, we interviewed one of our life science customers who shared insights into their organisation's adoption of SAP SPM solution, why they needed a transformation and benefits realised. Our customer's operations extend across multiple countries, and they market their products using sales reps and operations specialists. This customer faced several challenges unique to the complex life sciences market:

• High volume of accounts changing daily 
• Frequent account transfers and moving quota
• Ongoing Quota distribution and alignment
• Quota complexity
• Large quantity of data
• Every change had direct impact on agent's quota and associated commissions

These challenges led to the business demand for a transformation to provide an end-to-end automation from complex territory alignments and on demand forecasting to up-to-date sales dashboards to keep sales reps motivated and achieving their goals.

Implementing the SAP SPM solution helped to streamline processing high volume of account changes using SAP SuccessFactors Territory & Quota. Finance and Commissions planners are now using quota setting function to forecast and analyse products, accounts trends and see how they perform.  They also have an automated process to perform quota distribution triggered by change. Daily commission calculations are now triggered reflecting real-time quota setting changes. Daily dashboards are automatically updated to track progress versus achievement for sales teams. SAP SPM implementation has been integrated with customer's ERP and CRM platforms, facilitating smooth data sharing, and enabling on-demand planning and forecasting.

In summary SAP SPM solution’s comprehensive end-to-end sales performance process from Territory & Quota management to Incentive compensation management provides a scalable solution to support growing needs of the business with ability to handle complex calculation changes.

SAP SPM portfolio consists of products designed to streamline sales alignment, planning, quota setting and incentive compensation management practices. The portfolio of products are SAP SuccessFactors Incentive Management and SAP SuccessFactors Territory & Quota. These products are fully integrated to deliver continuity from planning and forecasting of territories to running commissions calculations and posting to payroll. Life sciences organisations can take advantage of this automation to address their challenges around:

• High volume of territory changes
• Ongoing quota settings and distribution
• On-demand quota forecasting and analysis
• Accurate and on-time commission payments
• Frequent account transfers
• Tailored approval processes

SAP SuccessFactors Incentive Management offers a sophisticated platform for tailoring incentive programs to suit the unique needs to calculate commissions for life science organisations. With powerful analytics, embedded intelligence, and built-in workflows, this solution can revolutionize compensation management. Its intelligent design not only fosters trust but also ignites motivation Managers and sales representatives can benefit from a comprehensive and readily available overview of both team and individual performance metrics, by accessing a user-friendly mobile app. 

SAP Success Factors Territory & Quota helps to translate life sciences sales strategy into effective sales plans. It facilitates it by allocating territories effectively and setting realistic quotas to keep sales teams motivated and engaged while aligned to strategic goals. SAP Success Factors Territory & Quota optimizes creating and managing of sales territories by leveraging Territory Modeling and AI Optimization. Sales Forecasting and Quota Settings uses advanced analytics to draw information from other enterprise solutions, tapping into multiyear historical data to analyse past sales performance. It helps to automatically define quota for each sales rep based on desired growth by product categories, accounts and time period. Visual and interactive mapping functionality provides a straightforward way to set up and manage territories. Geospatial analysis of sales territories enables organisations to quickly identify trends and coverage gaps. Robust analytics and reporting helps to monitor and analyse sales data, track progress against targets, and make informed decisions to optimize sales operations.

In Summary the Sales Performance Management solutions from SAP solution helps life sciences organisations to optimize territories, adjust quotas, and drive sales performance in alignment with the overall business goals. In this way, providing organisations to better motivate their sales force, maximize revenue potential, and adapt to changing market conditions.

You can learn more about how sales performance management helps customers by visiting SAP.com today.