Time-Based Organization Hierarchy for Dynamic Sales Compensation
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Solution Overview
Problem
Complex sales organizations with hierarchical management structures face challenges in efficiently assigning sales credit and calculating compensation, especially as the management structure changes, leading to administrative burdens and complexity in assigning credit and calculating compensation accurately.
Innovation Solution
A method and system for defining and managing time-based organization hierarchies, allowing users to create and manage instances of these hierarchies through a user interface, monitor achievement and attainment, and calculate compensation by accumulating transaction data in achievement containers and applying it to specified periods.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If complex hierarchical management structures are implemented to provide matrix coverage for sales credit distribution, then multiple individuals can receive compensation for a single sale, but the administrative complexity and burden of managing these structures increases significantly
Solution Approach 1:
The patent segments the organization hierarchy into discrete levels (individual contributors, managers, directors, vice presidents, president) with clear reporting relationships. Each level is independently defined with specific roles and responsibilities, allowing complex compensation structures to be broken down into manageable, standardized components that reduce administrative burden while maintaining multi-individual credit distribution capability
Solution Approach 2:
The patent creates universal compensation templates and standardized hierarchy definitions that can be applied across different sales organizations and time periods. These reusable structures allow the same compensation logic to serve multiple individuals and multiple sales scenarios simultaneously, reducing the need to create separate administrative processes for each case
2Adaptability or versatility
If the management structure changes through reorganization or personnel changes, then the organization can adapt to new business needs, but the complexity of assigning sales credit and calculating compensation increases
Solution Approach 1:
The patent implements dynamic hierarchy definitions where organizational structures, reporting relationships, and compensation parameters can be modified over time without requiring complete system redesign. The system maintains historical versions of hierarchy definitions and automatically applies the appropriate structure to transactions based on timing, allowing seamless adaptation to reorganization while preserving compensation accuracy
Solution Approach 2:
The patent establishes predefined compensation templates, standardized role definitions, and structured hierarchy frameworks in advance. These pre-configured elements remain relatively stable even as specific organizational details change, providing a consistent foundation that simplifies credit assignment and compensation calculation during periods of reorganization
3Ease of operation
If traditional hierarchical structures are used for compensation calculation, then compensation can be calculated based on organizational position, but retroactive calculations and historical accuracy become difficult when structures change
Solution Approach 1:
The patent captures and stores the organizational hierarchy structure, reporting relationships, and compensation parameters as they existed at the time of each transaction. This historical snapshot approach ensures that retroactive calculations use the correct historical context, maintaining accuracy even as the organization evolves. The system preliminarily records all relevant structural information before changes occur
Solution Approach 2:
The patent adds a time dimension to hierarchy management by maintaining multiple versions of organizational structures across different time periods. This temporal dimensionality allows the system to accurately match transactions with the appropriate historical hierarchy version, enabling reliable retroactive compensation calculations while preserving ease of operation for current calculations
Data Source
AI summary
A method, system, and article of manufacture for defining and managing instances of time-based organization hierarchies, and for monitoring achievement and attainment, and calculating compensation for individuals and/or groups within instances of the time-based organization hierarchies are disclosed herein. In one embodiment, a user may define and/or manage one or more instances of the time-based organization hierarchy via a user interface generated on a client. Moreover, and in response to a sales data input corresponding to a transaction, an achievement and attainment monitoring process may then be executed to accumulate transaction data in one or more achievement containers, and to compile achievement containers from a specified attainment period to calculate a user's attainment. In addition, an embodiment also provides for implementation of a compensation calculation process that may utilize the transaction data accumulated in the achievement containers to calculate an individual's compensation for a specified compensation period.