Why We Built the Sales Commission Operating System

Companies are on an automation binge - but for many reasons sales commissions have largely remained an outdated, manual process.



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Diarmuid Glynn
Diarmuid Glynn

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Why We Built the Sales Commission Operating System

The founders of EqualTo know this all too well, and their frustration around sales commissions was the reason they started the company. Their vision: to create a platform that fully automates sales commissions in a robust and reliable manner, while still allowing customers to accurately implement and maintain any incentive plan they may need.

Kim’s previous role at Contentful gave him a front-row seat to scaling from “Berlin upstart” to Germany’s latest unicorn. The manual commission process was ok when the sales team was small, and the comp plan was very simple. But as they went through hyper growth and expanded internationally, it quickly turned into a massive time sink for sales ops and finance, with hundreds of spreadsheets flying around each month. The problem for the sales team was mostly around transparency. Reps had little visibility on their earnings, which often resulted in friction, disappointments and reduced motivation.

Gijs and Diarmuid built an enterprise sales team at their previous startup, where they also tracked sales commissions in spreadsheets. It worked with a few employees, but the ‘free’ spreadsheet-based process became expensive as the company grew, increasingly sucking up management time (Check out our previous blog post on why managing sales commissions in spreadsheets doesn’t scale.)

Our experiences were in no way unique, and the problem is not limited to startups or scaleups. We’ve seen the exact same problem in larger organizations. Huge sums are paid each year to sales teams in commission, but without proper IT infrastructure in place.

The products on the market to manage sales commissions are underwhelming. They have poor UX, are difficult to integrate with and are too complex to maintain in-house. With most, you become dependent on expensive external consultants for every change to your incentive plans.

Companies are still using spreadsheets to manage sales commissions because the alternatives are worse. Products that try to replace spreadsheets are less flexible and require retraining.

But spreadsheets are no panacea. They are hostile to automation, and a spreadsheet-based incentive plan is difficult to analyze, optimize and project into the future. Salespeople will also complain that a spreadsheet-based incentive plan lacks transparency, which negatively impacts employee satisfaction and retention.

With EqualTo, companies can replace their ad-hoc, spreadsheet-based processes entirely. It serves as the single source of truth for commissions, and seamlessly connects to many pieces of core infrastructure such as CRM, ERP, HR, Payroll and accounting systems.

How we are different

Flexible, no code plan design
Unique to EqualTo is the intuitive, version-controlled plan design environment, where spreadsheet formulas can be used to accurately model any desired commission plan. Customers already have the required skills in-house, and the transition from spreadsheets to EqualTo is frictionless. Companies retain control of their own plans, and are not at the mercy of expensive consultants.

EqualTo guarantees historically consistent data
During the pandemic, many companies adjusted their targets retrospectively. But such retrospective changes are also common under normal conditions: a deal is cancelled for which commission was paid, the value of a deal is corrected on the CRM, or the incentive plan is adjusted shortly after rollout. These kinds of changes are very hard to do manually, and are even harder to explain to the sales rep. Because changing one piece of historic data has knock on effects on everything else.

EqualTo automatically tracks all data dependencies and keeps things historically consistent at all times. When changes are made, EqualTo automatically computes the corresponding debit or credit transactions for payees. Regardless of what changes and when, or in what order the data arrives, customers can rely on EqualTo to always accurately compute the same net earnings.

Support for headless, white-label integrations
Many companies already have rep-facing systems in place. Rolling out another platform directly to all reps might be unappealing - even more so when external brokers or partners are involved. For these use-cases, EqualTo operates as a headless system that is seamlessly integrated with other services. Our API-first architecture allows commission data to be presented and visualized in the CRM or in proprietary applications. BI and DWH systems can easily pull data from EqualTo to analyse and recombine commission data in new and insightful ways. Our white-label solution allows for branding of EqualTo content such as monthly commission statements.

Transparent processes for all stakeholders
Deal data is pulled from the CRM and goes through an optional approval process. EqualTo automatically calculates the reward, and issues the corresponding debit or credit transactions to the personal reward account of the employee. This prevents disputes, and makes it crystal clear to everyone what to expect in their next payslip

With automation in place, and clean data to analyse, managers can plan for the future and use incentives strategically. For the C-suite, EqualTo provides dashboards and analytical tools to conduct what-if scenarios, align incentive plans with business strategy, and increase the ROI on sales commission.

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