Credit rules are the basis of Incent and compensation. The efficient use of crediting can reduce complexity and confusion and create an overall good experience for the customer. In general, a credit rule has 3 parts:
- Definition: Name, date, credit type, etc.
- Conditions: What orders qualify for this credit?
- Results: When the condition is true, what is the value of the credit, and which credit will it be assigned to?
It allows for crediting across an organization in a lot of unique and interesting ways. There are 3 main types: Direct, Indirect, and Bonus, which can be further broken down to leverage an organization’s individual requirements.
The most common type of credit is direct credit. The most basic of the 3 as it works how you would think is that it will look at an order and will give credit to the person who is explicitly named. One way in which direct credits can be further leveraged is through triggers which are orders created for the functionality of aggregating previously calculated direct credits for a user.
Indirect credits use the direct credits that have been fired and can pass on the credit to others within the organization. They are interesting because it can give the customer some flexibility in terms of how they want to pay groups of people. Indirect can be split up into 2 categories:
Hierarchy and Named Relationships
- Hierarchy is more straightforward in the sense that it uses the HR data in the system to decide who the direct credits should roll to. This is the most common practice as most organizations operate in the way of credits being passed from the bottom level reps up to the Managers then VPs etc.
- Named relationships give incent implementations a lot of room for creativity. Basically, you can create 1 to 1 or 1 many relationships which do not have any connection in a hierarchy or otherwise, to allow credits to roll through. An interesting use case is to create a placeholder position and create a relationship between this position and a group of people who are supposed to get paid on some kind of unique component that will not be able to use hierarchy.
The last of the 3 is bonus rules. Which are unique from the other 2 as they are sort of credit rules and commission rules built into one. Direct and indirect credits are simply giving a credit amount that is then passed into a commission rule to determine the payout. Bonus rules do both in the same place because you are limited to give conditions on when the bonus should be paid and then the value which should be paid: a flat amount, derived from a formula.