Name: Introducing SAP Incentive Management
Uploaded: 2026-5-12
Duration: 196 s
Description: This video provides a high level overview of SAP Incentive Management. You’ll learn how Incentive Management can help you streamline the compensation process, how the compensation process works, and how it applies to an Administrator and End User.

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<div><div><div><div><div><div><div>This video provides a high level overview of SAP Incentive Management. You’ll learn how Incentive Management can help you streamline the compensation process, how the compensation process works, and how it applies to an Administrator and End User.</div></div></div></div></div></div></div>

Introducing SAP Incentive Management

Hello and welcome. In this video, I'll introduce you to SAP Incentive Management. I'll provide an overview of Incentive Management, then I'll discuss the compensation process and how it applies to an administrator and an end user. Let's get started. SAP Incentive Management is a cloud-based, end-to-end solution that automates your incentive compensation process from sales order to payment for both your direct and indirect sales force. What, exactly, do we mean by incentive compensation? Let's start with compensation. This is defined as the total amount of monetary payment provided to an employee for work performed. Incentive compensation specifically refers to variable compensation based on performance or achievement of a goal. The components of incentive compensation are detailed in a compensation plan. A compensation plan is made up of rules that specify how to compensate each payee based on performance or achievement of a goal. Let's look at a scenario. Each sales representative uses an application to enter and track their sales opportunities. Generally, this is a customer relationship manager or CRM, systems such as SAP Cloud for customer. Once an opportunity is won and the sale is final, it moves into incentive management and becomes a transaction. When the calculation is run, the transaction is allocated to the sales representative as a credit. This can be done using transaction pre -assignment or by using a territory. Achievement is measured by aggregating all credits allocated to a single payee. This is called the measurement because it measures the achievement for each payee. Next, earnings are calculated for each payee based on the measurement. Earnings may be commissions, bonuses, or other special incentives and are calculated using a combination of rate tables, formulas, and other objects to ensure the correct result for each payee. Finally, payments and balances are generated for each payee for the period. Similar types of payments are grouped together, balances from prior periods are applied, and the payment data is ready to go to payroll or accounts payable. This entire process is managed by a compensation administrator. The administrator can configure the user interface, create compensation plans with the collaboration of the sales and operations management teams, set data level and user security, run compensation calculations and review results, build and distribute compensation plan documents, manage payee disputes and inquiries, onboard new payee information, and create and publish dashboards. The end users of incentive management are the payees. Payees can view and accept compensation plan documents, view their compensation results in dashboards, and raise a dispute or inquiry if they suspect an error in compensation. We hope this short video gives you a good start to your incentive management journey.