ICM Overview and Partnership

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ICM Overview and Partnership

Incentive & Commission ManagementOctober 2005

©SAP AG 2005

Overview

Partnership

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Incentive & Commission Management

Analytics ReportingPlanning &

Forecasts [-]Simulation [-]

Business Logic ValuationEntitlements & Claims

Payments & Schedules Liabilities

Targets & Bonuses Assignments & Segmentations

Partnerships, Agencies & Channels Transfers

Accounting Settle2PayReserves Accruals [-] Flat Rates & GuaranteesContract Accounts Business Accounts

[-]

Solution Integration SAP for Insurance my SAP ERP mySAP CRM

User Productivity WorkflowWorkcenter Self Services [-]

Service Architecture CalculationsDeterminations Audit SupportModelling & Construction Mass Services

Licenses & Qualifications [-]

Contracting & Correspondence

[-] Future Focus

Risk Analysis [-]

Adjustments

Focus AreasICM 2005

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FS-PM e.a.

ICM / FS-CSPFO

Basis like Tools

Licensing

Planning&

Analytics

Partner skills, credentials, potentials

[future scope]

Assigned tasksin details

Partner motivation, incentives

Built on Netweaver,

Decoupledfrom ERP/ECC

Interfaces Services

What-if scenarios,analytical content

[future scope]

ICM and Its Context

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Complex TargetAttainment Calculations

ICM Package Landscape & Dependencies (ERP2005)

Kernel PackageCACS00

CondTechniqueCACSSD

Settlement SchedulesCACS25

Actual CommissionCACS27

Settlement HR-PYCACSHR

Settlement FS-CDCACSCD

Settlement FI-AP/ARCACSFI

Drilldown ReportingCACSRC

SAP for InsuranceFSCS01

mySAP CRMCRM001

Portfolio AssignmentPFO100

PartnershipsCACS42

Target AgreementsCACS26

Complex ValuationCACSTX

Simple CalculationCACSM2

BW SupportCACSBW

TransfersPFO110 / CACS41

Transfer FWCACSOA

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Overview

Partnership

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Partnership: ScopePartnership: Master DataPartnership: Commission CasePartnership: Customizing & Configuration

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Requirements: Teams and Partnerships

TEAM: Group of commission contract holders that are to work together on a contractual basis by

Sharing knowledge Exploiting synergies regarding their expertise and customer poolUsually no limitation with respect to the duration of the contract

PARTNERSHIP: combination of (usually two) agents, A senior and a junior, with the aim of Gradually transferring responsibilities and expertise

COMMISSION: Will be distributed toAgent responsible for the business Remuneration group

REQUIREMENTS:Dependence of distribution of remuneration on criteria computed at runtime and automatically determine team members at runtime

LIMITATIONS:, Support of “activity participation” only (valuation is distributed)No “Nesting” of teams of partnerships

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Scope: Summary of Functions

“Partnerships” is the name of the new ICM functions to fulfill these requirements by:

Grouping commission contracts in a contract bundle

Allowing a member of the partnership or the partnership itself to act as a placeholder for the whole partnership within acommission case

Providing functions to distribute remunerations among themembers according to the partnership-specific rules stored in the bundle

Allowing members to be treated like direct participants incommission case in certain respects (e.g. regardingdetermination of indirect participants)

Extending existing concepts of determination of (direct/indirect)participants

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Master Data I: Elements

What makes up a partnership?

Prerequisites (Contract types etc.)

A partnership consists of:

A contract bundle of a certain type

Member contracts (ordinary commission contracts)

Exactly one group contract

Configuration (master data of partnership)

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Master Data II – Group Contract

The group contract:

Represents the legal aspects of the partnership

Is (almost) an ordinary commission contract

Must be in a one-to-one correspondence with the partnership (and can be used only once)

Needs a standard contract based on special contract type (torepresent partnerships)

The underlying standard contract May have any agreement (possible uses: correspondence, bonus points for group achievements, …) Must have at least a participation agreement (and has, automatically, a valuation agreement)

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Master Data II: Creating a Partnership

How do I create a partnership?

(Assuming the commission application is already configured to support partnerships)

Create commission contracts of partnership members (if necessary) and save as active

Create the group contract for the partnership, save as active

Create the contract bundle for the partnership(*)

Enter configuration data specific to this partnership

(*) The entry screen for creating the bundle may be called automatically after creating any group contract. In this case the field for the group contract will be pre-assigned with the group contract you have just created

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Master Data III: Creating a Partnership, Screenshots

Alternatively (if [group] contracts already exist):

Go to CACS Menu, choose:Master Data -> Contract Bundle -> Create

Enter bundle description as usual

Choose required preconfigured bundle/partnership type (F4)

Note: not every bundletype is a partnership

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Master Data III: Creating a Partnership

Members of the partnership (commission contracts, existing bundle functionality) Note: no bundles/partnerships allowed!

New bundle functionality (partnerships only):

Read-only data from Customizing (specific for partnership type)

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Individual agreement for partnership, available entries specific for partnership type

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Distribution of valuation in commission case depending on selection criteria

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Split values depend on contract IDs (and may also depend on “lead”)Selection criteria

are defined by customer and are specific for partnership type

Split values may be entered as percentages or ratios. In an exit a validity check may be performed (e.g. if percentages add up to 100%)

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Partnerships in Commission Case I

General:

From the perspective of “ordinary” participants, a partnership in the commission case is treated as just another direct participant

Contract 16 is an ordinary commission contract

Contract 157 represents a PS with group contract PS_GRP003

Owner of contract 16 doesn’t need to care whether owner of contract 157 represents a partnership

Note: If “dedicated contracts” has been switched on, specification of the group contract is not necessary

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Partnerships in Commission Case II

The partnership is resolved during computation of the commission case, that is:

The partnership is derived from the data at the interface (if not supplied)

All members of the partnership are determined

Valuation is computed for the contract provided at the interface (157 in this case)

The part of the valuation assigned to the PS is split among the members of the partnership according to the agreement in the partnership and assigned to the members with entitlement category 6

Entitlement object ID is the direct participant representing the partnership

The members of the partnership compute according to their individual contracts

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Remuneration Within a Partnership

Partnership

+ Case data

+ Comparison with partnership master data

• Contract 157 will get 83.33% of70% of the valuation

• Contract 156 will get 16.66% of70% of the valuation

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Further Functions: Indirect Participants

After resolution of the partnership within the commission case, the group contract and the members are known to the commission case as participant with entitlement category 6 “Partnership”:

Part ContrNo … Role DirShar IndShar … GroupContResp1 157 802 70 60 PS_GRP003

Part PartPos PersResp ContrNo Role DirShare IndShare EntitlCat. EntitleOjId1 1 157 802 70 30 1

… … … … … ... … … …1 6 PS_GRP003 802 6 1

7 156 802 6 18 X 157 802 6 1

To participants with entitlement category 6, indirect participants may bedetermined in the same way as for those with entitlement category 1 (setting of the Partnership Type).

Four different switches are available (settings “on” or “off”):Determination of indirect participants:

1. In organizational hierarchy for group contract2. In organizational hierarchy for (all) member contracts3. By contract relationship for group contract4. By contract relationship for (all) member contracts

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Remuneration of Indirect Participants

Remuneration of indirect participant differs for entitlements originating from entitlement categories 1 (direct participants) and 6 (partnerships):

Entitlement category 1 Entitlement category 6

Dir. Part

Direct Share Indirect Share

40% 55%

Ind. PartRemType XY1RemType XY5RemType AB3

XY1, XY5with 40%weighting

AB3with 55%weighting

RemType XY7

Dir. Part

LOB = LIFE,--- Role = AGT, LEAD

40% 55%

Ind. Part RemType XY1RemType XY5RemType AB3

?

? ?

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Customizing and Configuration

Creating and configuring a commission application for use with partnerships:Include ICM package CACS42 in your applicationDecide on the setting of switch for dedicated contractsDefine structure of selection tables for partnership and enhance structure:

Structure <APPL>_S_PS_SCCD must contain all customer defined key fields contained in any of the selection tables:

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Customizing and Configuration

Create contract type for group contracts, roles and constellations

Create standard participation agreement and standard contract for group contracts (minimum requirements)

Define partnership types (Customizing activity Maintain Contract Bundle Types)

Create Customizing for general partnership (separation rules, characteristics combinations)

Configure partnership types: Assign separation rules and selection criteria table to partnership typeDefine behavior for determination of indirect participantsAssign tool of logical service to partnership type (“Partnership_Standard” tool is supplied)

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ICM Overview and Partnership

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