Salespeople are famous for their can-do attitude and self-confidence, but in 2003, Telus Communications, an $8.2 billion Canadian telecom, realized its sales incentive management system didn't match its reps' go-get-'em energies. Telus serves 10.3 million customer connections, including wireless, land line, and Internet, and despite the sophisticated service on offer, the company used multiple incentive management systems that singly or together did not provide the automation, real-time reporting, and modeling that Telus and its 300 (now 1,000) payees required.
Enterprise incentive management (EIM) is important in any sales organization, but its value increases relative to the complexity of the payment structure. Telecommunications is an industry with extremely convoluted offerings--the vertical's sales compensation plans are complicated, too. A retailer or direct seller might get paid not only for signing up new customers, but for signing customers who stay with the company for at least six months--especially important in an industry with a high churn rate. Cross- and upselling additional products and services to customers is also rewarded.
Telus' sales departments were restrained by the lack of a modern enterprise incentive management system, which resulted in errors, expense, and some shadow accounting.
"Three years ago we established a critical corporate objective: Our sales organization needed to have reliable, real-time information--to drive performance--and high productivity aligned to corporate targets," says Tanya Dorbyk, vice president of sales performance. After a review of enterprise incentive management vendors, Telus selected and deployed Callidus's TrueComp software.
With it, Telus reduced incentive overpayments by 60 percent, but there's much more to the story than that simple number. The compensation error rate dropped by more than 53 percent, and dispute resolution accelerated from 40 hours to eight, a 500 percent improvement. This has resulted in reduced cost of compensation management, to the tune of $560,000 annually.
And let's not forget the effect on the sales team itself. The Callidus TrueComp system cut shadow accounting from 40 to five hours per salesperson, per month, effectively recovering 52,500 days of sales time. This led to an additional 572 sales transactions annually, with an eventual result of 4.25 percent revenue growth in 2005. Telus recouped its investment in TrueComp software in fewer than six months, and the total ROI to date stands at 3,316 percent.
"More and more companies understand the critical strategic importance and significant business value that our industry-leading EIM solutions provide," says Shanker Trivedi, senior vice president and CMO for Callidus Software. "The Telus Communications implementation and results validate our ability to swiftly and efficiently improve sales performance and productivity, align sales strategy with corporate objectives, and drive revenue."
An efficient telecom is a happy telecom. "Callidus TrueComp Enterprise helped us meet our requirements. With TrueComp, our sales force is able to work more efficiently, we reduced time to market for our products, and increased our financial predictability," Dorbyk says. "Even more important, it enables us to offer more strategic solutions to our customers."
By putting its salespeople on Callidus TrueComp, Telus Communications:
reduced incentive overpayments by 60 percent;
recovered 52,500 days of selling time;
cut incentive management administration costs by $560,000 annually;
reduced compensation error rates 53.6 percent; and
cut average dispute resolution time from 40 to eight hours.