Incentive Compensation

5 Solid Reasons to Ditch That Spreadsheet and Move to a Commissions Automation Software

Samra Taban
min read
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You know those situations where everything seems like it’s under control and you’re cruising through it. And, then suddenly, everything goes out of hand. 

There’s havoc, confusion and a lot of ‘why me?’ screams. That’s what happens when you calculate your commissions using spreadsheets. 

I mean, don’t get me wrong. I have nothing against spreadsheets. In fact,  it is impressive how they’ve managed to create a cult of their own with gurus and aficionados finding new, never-done-before ways to manage their data. 

But, when it comes to commissions, spreadsheets, while they seem like they’re doing the job, aren’t quite hitting the nail for you, my friend.

So, if you’re still employing spreadsheets to calculate your commissions, let me give you five solid reasons why you should ditch the sheet before the ‘sheet’ hits the fan. 

1. It’s INSANELY time-consuming

Take for instance you have one or more sales commission spreadsheets powered with formulas and tables. 

For each pay period, you’ll have to copy sales records onto your master spreadsheet, run formulas to calculate commissions, create a copy to share to each rep and other relevant members of the team. 

And, if there is an adjustment to be made or if data is missing, you’ll have to start from scratch and re-generate new spreadsheets. It’s going to take forever!

You’ll have to go through this process during every pay period. It’s doable if your sales team is small. 

If not, you’ll find yourself spending all your time only generating commissions. In fact, you’ll not even have time to analyze the data. 

Time consuming

2. Scalability is a no can do

I am just going ahead and saying it: spreadsheets are simply incapable of catching up with growth. 

If spreadsheets were dinosaurs, growth is the asteroid that killed them. 

Running commissions on sheets becomes labour intensive and an operational nightmare at scale. 

As your sales planning becomes more and more complex with multiple compensation plans including SPIFs, bonuses, draws and accelerators, spreadsheets will start letting you down. It’s inevitable. 

Companies will keep adding more and more layers of complexity to enhance growth, therefore, demanding scalability in commission management that spreadsheets will not offer, not today, not ever!

Scalability issues

3. Data integration with CRMs? What’s that?

Sure, you’ll see a lot of frowns and eye-rolls when you ask your reps to update their CRM. But, CRM is a necessary part of the sales commission process. 

In some cases, you’ll also have other accounting systems in play. You’ll have to transfer the data from the CRM to the spreadsheets manually as they are not synced in real-time. 

That’s a lot of time wasted on something that can easily be automated. Besides, manual data migration is dangerously error-prone. 

And, commission errors are not that easy to fix. From manually examining data and detecting the issue to ‘fixing the payment’, it’s a horror of a rollercoaster you’d not want to be on! 

Integration isn't possible

4. Zero-visibility possible for reps in real time

With spreadsheets, reps have no clue as to what their payouts look like until they receive their cheque. Lack of visibility here leads reps to having expectations on their incentives based on their calculations. 

It so happens that due to the complexity of compensation plans and various nuances and conditions of the deals they close, the reality might turn out to be a whole different story. 

And the result? Demotivation and disputes between reps as well as between reps and ops on who gets comped for the deal and how much. 

Besides, lack of real-time visibility also means a missed opportunity for reps to visualize their commissions on a deal level and alter their plans to hit targets and even overachieve. Why would you let go of potential revenue growth due to your choice of a commission management tool? Think again.

zero visibility for sales reps

5. It’s a bouquet of red flags

In my title, I said I’ll give you 5 solid reasons to move away from spreadsheets for commissions but as I was writing this blog, I had so many more reasons to bid your spreadsheets goodbye. 

Spreadsheets are familiar, comfortable and sometimes even nostalgic. But, they serve you well only for short-term analysis and not for long-term data management. So, here’s a consolidation of all the red flags as my fifth point:

  • Spreadsheets are inflexible and hardly interactive
  • Spreadsheets promise limited accessibility
  • Math functions are complex, error-prone and fail at the tiniest bit of change
  • Your audit trails are ineffective
  • It is practically impossible to keep up with accounting and legal compliances

Should I go on? Because I can. 

And now… for the blazing question. 

If Not Spreadsheets, Then What?

“The biggest nightmare for me was always administering the firm’s biggest expense (salary and incentive plans) using spreadsheets. 
They were never designed or intended to be the ideal way to collect recommendations, do complex modeling and analysis. 
I knew there had to be a better approach using technology to break free from spreadsheets and limitations in HCM-suited applications.
Compensation management software does just that.”, says Howard Nizewitz, Managing Consultant at CompTeam. And, here's your answer. 

Operations teams need to focus on strategies and ways to better streamline processes to maximize revenue and growth. They don’t have to battle with rows of data everyday. Automate commissions and knock hours of spreadsheet outrage off the calendar.

Likewise, reps need a proper dashboard that gives them the exact details on their deals and commissions. 

In fact, they should even be able to visualize what their commissions look like before they close deals. 

Howard further adds, “It is time to change and leverage technology to facilitate these processes and help reward professionals imagine and realize what they can accomplish once they are freed from spreadsheets. At the same time, the business benefits from a more efficient process with more strategic analyses.”

Final Thoughts

I am not asking you to banish spreadsheets. Use them for quick analysis and documentation when they can manage the load.

Anything beyond that? Go for a sales commission software that can manage all your complex compensation plans and the ever-increasing number of customer-facing professionals. 

So, are you ready to make the ultimate switch? Schedule a demo with Everstage today. 

Acknowledgement: Thanks to Aravindh Natesan for the designs.

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