SD Disputes & Complaints

Incentive & Commission hands on Customizing

Lets explore  ICM’s Customizing 

Master Data – Business Partners

Definition: Organization (firm, branch office), person or a group of persons or organizations in which your company has a business interest. Business Partner (BP) is central component of the SAP R/3 ICM Solution which is used in all applications. Business partners are created only once in the system. When a commission contract is created, it is given a unique assignment to a business partner with the role of commission contract partner. 

Control Elements of Business partners 

1. Business Partner Roles

2. Business Partner Categories

3. Business Partner Types

Organization Structure of ICM

The SAP organizational tool (PD-ORG ) is used for creating organizational structures. Manage your internal and external workforce by defining responsibilities, for e.g. territories. It allows you to display the following:

▪ Organizational units
▪ Job profiles
▪ Positions
▪ Relationships
▪ Staff assignments

▪Indirect participants can be determined by:
▪ Structure
▪ Contract relation
▪ Data from the inbound interface

Commission Contracts

The commission contract maps the relationship between company and commission contract partner or commission contract partners amongst each other. AII monetary and non- monetary agreements between the parties are mapped in the commission contract. Contracts are generally managed in versions (time-dependent). All documents can be managed together with the contracts, using optical archiving. 

The commission contract is the central control element for:

1. Management

- Responsible commission clerk

- How does communication take place?

2. Participation ratios

- Relationship with indirectly participating commission contract partners

- Which commission contract partners may act amongst each other?

3. Calculation bases
- Which conditions, rules, formulas, etc. are applied in which case?

- Monetary processing

- How are commissions settled and paid and via which channels?

- Market ratios 4. Which products may be sold by whom in which regions etc.?

Commission Contract - Types

Different commission Contracts exists. They are as below

1. Global Commission contracts

2. Standard Commission contracts

3. Individual Commission contracts

Commission Case

The commission case determines the remuneration result of the commission recipient on the basis of the information provided. It requires at least the following information:

• Business partner 
• Business object (e.g. a sales order) 
• Commission activity 

Commissions are generated when a process (business transaction) takes place in an enterprise, which results in added value and at least one participant is involved. Agreements have to be made that trigger the disbursement of a commission. With Incentive and Commission Management, you can remunerate a wide range of business transactions as the system is extremely flexible. The result of the commission case is a commission document, which is required for settlement.

Commission case consists of four major process steps:

• Participant determination 
• Valuation calculation 
• Remuneration calculation 
• Posting

Inbound Interface Information

The structured inbound interface offers the link to the operational system and contains information on
1.Participants
2.Activities and
3.Objects relevant for commission


Maximum flexibility is achieved through customer field enhancements to the inbound interface, with no modification necessary.

Commission Case Processes

Prerequisite Customizing

IMG à Activate SAP ECC Extensions (  T Code: SPRO)

Prerequisite Customizing – Packages 

IMG à ICM à Application Admin àInstallation of commission Application  à Name Commission Application

IMG à ICM à Application Admin àInstallation of Commission Applicationà Select Commission Packages

Prerequisite Customizing

IMG à ICM à Basic Functions àPreparation of Posting à Select

Commission Packages à Commission Contract Partner à Define Number Ranges

IMG à ICM à Basic Functions àPreparation of Posting à Comm.Docs, Stt. & à Edit Update Mode For Totals Tables

CACSIMG à ICM àBusiness partners àBDT settings( SE43: BUPT)

( SPRO)IMG à Cross Application àSAP Business partners à Business partner   àBasic settings àBusiness partner roles àDefine Business partner roles

( SPRO)IMG à Cross Application àSAP Business partners à Business partner   àBasic settings àDefine Business partner Types

Master Data – Organization (i)

SAP easy Access à Human Resources à Organizational Management à Organizational Plan à Org. Plan à Org. & Staffing ( Trxn :PPOCE)

SAP easy Access à Accounting àICM àMaster Data à Org. Plan  à Org. & Staff Assignment ( Trxn :PPOME)

 SAP easy Access à Accounting àICM àAdministration  à System Admin à commission clerk àCreate ( Trxn :CACSMD301)

SAP easy Access à Accounting àICM à Master Data à Contract Partner à Create ( Trxn : CACSMD001)

SAP easy Access à Accounting àICM à Master Data à Commission Contract   à Create ( Trxn : CACSMD6101)

IMG à ICM àBasic and Master Data àStandard Commission Contract à Define Contract Types

IMG à ICM àBasic and Master Data àStandard Commission Contract  àAssign Commission Contract Types to Partner Types

Determine participants

IMG à ICM àBasic and Master Data àStandard Commission ContractàParticipation Agreementà Edit Participant Roles

IMG à ICM àBasic and Master Data àOrganizational Structure àAssign Commission Contract Types to Participation Roles

Valuation

IMG à ICM àBasic and Master Data àStandard Commission Contract àValuation Agreement àEdit Valuation Types

IMG à ICM àBasic and Master Data àStandard Commission Contract àValuation Agreement àEdit Valuation Types

Remuneration -Performance related Calculation

Flat rate Calculation

IMGà Incentive and Commission Management ® Basic and Master Data ® Standard Commission Contract  ® Remuneration Agreement ® Agreement for Flat-Rate Remunerations

Contract Type Screen Management

CACSIMGàBasic and Master Dataàcommission contractàBDT settings

Incentive & Commission in SD

In this topic ,we will discuss about Incentive & Commission process ,Configuration in SAP Sales & distribution 

Let understand concept ,Incentive & Commission management widely know as ICM  

Incentive / Commission is a variable remuneration for employees and partners. 

These are to realize enterprise strategic goals like improved sales performance or quality, cost reductions or other types of value creation to the organization and can be monetary or non-monetary in nature

Purpose of ICM

Incentive & Variable compensation is a very effective level for aligning behavior such as sales performance with Corporate Goals. In highly competitive markets businesses need a highly motivated sales force. Flexible and Performance related compensation is the steering instrument for increasing performance. It is used to align sales force and employee performance to Organizational business goals. In dynamic world, Companies organizational structure, sales channels, and product offerings often changes and calculation rules also changes proportionately and rapidly. when changes occur compensation is a significant cost element in businesses. Accuracy in calculations and cost control is important. To keep pace with that we need a flexible tool to calculate compensation types. Incentive and Compensation Management (ICM) is focused on calculating variable awards for co

Whether you sell cars, insurance policies, or e-commerce services, incentive compensations and commissions play an essential role in your sales management 

Used as a strategic tool, incentives and commissions help you to improve employee performance and reduce costs.

ICM is used to address this complex business process.

History of ICM 

SAP started developing a commission management in late 1998 together with MSG

Systems as a partner. The target was to build an industry-specific solution in a first step and to make this available throughout different industries in a second step. The first step was focused on the insurance industry, targeting the high end of market requirements.FS-CS (Financial Services –Commission System) was developed together with 4 charter

Clients in Release4.51. The second step building ICM as a cross-industry follow-up of

FS-CS started in 2001. One focus in this step were the CRM and HR integration. Further focus was the enhancement of the commission modeling and calculation capability.

In 2003 and 2004, ICM began to gain ground in further target markets. Together with the hereditary ones, the targeted markets are:

• Automotive 
• Banking 
• High Tech & Electronics 
• Insurance 
• Media 
• Telecommunications 
• Trade & Wholesales 

ICM Architecture

Basic understanding of ICM

ICM is a control tool which is used to realize strategic enterprise goals for monetary and non-monetary incentives, for example, improved sales performance or quality, cost reductions or other types of value creation for your organization.. The flexible nature of ICM allows you to react swiftly to changing circumstances. When the enterprise strategy is changed, this can be reflected immediately in ICM. 

Depending on business, market situation and enterprise structure, the business requirements vary, and this is reflected in the different levels of complexity offered by ICM. Since the various branches of industry are very different from each other, SAP provide the option of designing customers own commission management system according to your industry-specific requirements by selecting ICM packages. Thus ensuring of creating a commission management system that matches business requirements exactly. SAP also provided option of adding customer specific rule definitions to the preconfigured ICM packages

Packages & Component

Business Process Overview 

SAP Solution Integration  

Master Data Component 

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