Professional Documents
Culture Documents
Global Sponsor
Managing Governance
Challenges in the
Rebate Lifecycle
Motorola Solutions Inc.
Case Study
Sonal Sood Manager - Deloitte Consulting
LLP
Earl Eldridge Sr. Director - Oracle Corporation
02-Oct-2014
Increase sales
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Brand
Direct
Go-To-Market
Reseller
Customer
Brand
In-Direct
Brand
Distributor
Reseller
In-Direct
Engage companies
sales force
Ecommerce
Own-branded store
Re-seller represents
and sells a companys
products or services
Other terms: LAR
(Large Account
Reseller), VAR(Value
Added Reseller), Direct
Market Reseller(DMR)
Distributor is engaged
to reach a larger market
often via multiple
channel partners
Other terms: Value
Added Distributor (VAD)
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
t
irec
d
n
I
Di
re
Marketing
Funds
ct
&
In-Direct
Expense Realization
US GAAP : Report
as incurred
expenses as part of
Selling, General
and Administrative
expenses
SOX and FASB :
Expenses incurred
as part of
promotional
allowance programs
are viewed more as
perks, or simply
rewards for sales
performance, and
should be classified
as contra revenue
ROI
An investment in
supporting your
greatest asset, your
brand
Evaluate and
measure across
common expense to
sales ratios to
determine their
effectiveness
Perform Average
Selling price
analysis
Marketing expenses that successfully produce sales can offer a high return on investment
6
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
70% of
marketing spend
10-25% of sales
67% of the Consumer & Industrial Product Companies indicate increasing trade promotion spend in 2014*
Manufacturers deduct
some percentage from the
invoice price for purchases
made during the deal
period
Quantity based and price
reduction in the form of
additional merchandise
Performance
Incentives
Discounts on merchandise
that the retailer sells at a
discount to its customers
Manufacturer pays the
channel after having
verified the sales
performed to end users
Sales Quotas
Discounts or rebate
payments offered to
retailers who meet the
manufacturers sales
quota
Marketing
Development Fund
CO-OP
Program provides
partners with
marketing allowance
that accrue as a
percentage of sales.
Discretionary funds
provided by
manufacturers to their
eligible channel
partners based on the
negotiated goals.
Having an effective trade promotion strategy and process is critical in order for companies to benefit from ROI and
allocate funds for other strategic initiatives
* http://www.acosta.com- The_Trend_Behind_The_Spend/trend-behind-spend.pdf
3
2
Technology
People
Process
Strategy
Channel Marketing is one of the most comprehensive disciplines in the business environment which extends corporate initiatives across multiple
disciplines including sales, marketing, finance, supply chain and sales operations
8
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Strategize
Allocate
Budget
Establish Allocation
method
Topdown/Lump
sum
Bottom-up
Accrual based
Allocate to customer
account group,
region, or specific
account
Get approval from
Go-To-Market team
Create
Promotion
Plan
Internal/
Customer
Approval
Discretionary trade
promotion allowances do
not require approval as
they are executed behind
the scene
Other promotions need
approval from the
customer
Share the promotion plan
in detail
Communicate how
performance will be
measured in order for
customers to be eligible
for the promotion
Lock down the payment
method for settling claims
against rebates
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Execute
Promotion
Plan
Evaluate
performance
Profit and
Restrict booking manual
cost per
accounting entries
incremental
sale etc.
2012 Deloitte Global Services Limited
Strategize
Allocate
Budget
Create
Promotion
Plan
Execute
Plan
Customer
Approval
Adjust
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Evaluate
Monitor
Strategize
Allocate
Budget
Create
Promotion
Plan
Execute
Plan
Internal
Approval
Evaluate
Adjust
Process
Enablement
11
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Monitor
Case Study
GOVERNMENT
ENTERPRISE
NEXT
GENERATION
ASTRO
PCR
TETRA
PRIVATE
BB
iC&C
iDEN
MCD
ADC
RFID
WLAN
CEC
SOLUTIONS
DRIVEN
PRODUCT
+ APPS
+ SERVICES
CUSTOMER
FOCUSED
VERTICALS
GOVERNMENT
13
MANUFACTURING
& FIELD MOBILITY
TRANSPORTATION
& LOGISTICS
RETAIL &
HOSPITALITY
Footer
This
presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
ENERGY &
UTILITIES
EDUCATION &
HEALTHCARE
Strategy
End-User
Marketing Distribution
Distributor
14
Reseller
Reseller
Trade Promotions
Promotion Construct
MOU( Memorandum of
Understanding) : Channel
Significant business
volume and complex
rebates structure e.g.;
Tired discounts by
dollar volume and
quantity
Country specific
requirements adds
another layer of
complexity
MDF(Marketing
Development Funds):
Discretionary funds
allocated to partners to help
them create and participate
in joint marketing and
business development
programs that can help to
increase sales of Motorola
Solutions products and their
value-added services.
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Issue-to-Impact
Issue
Process
Rebate calculation inaccuracies due to lack of system
capabilities to use accurate data to compute simple to
complex rebates
Manual creation of JE for Expense and Liabilities in GL
results in transaction traceability and audit issues
Average Selling Price (ASP) for shipped and backlog
orders is not reflected accurately until end of the month
Everything is booked at Invoice price and during the end of
the month the ASP suddenly drops
Inability to course correct within an incentive program
duration
Manual claim settlement process results in inaccurate and
duplicate rebate payments along with delays in payments
People
Technology
Promotional plans maintained in Excel
Shipment and Billing information was exported out of
reporting system in Excel and complex macros were written
to compute accruals and Journal entries
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Solution
Impact
Process
Automated accrual calculation and settlement process
Established one global process for offer setups, accrual
tracking, revenue forecasting and claim settlement
process
Established a central command center to review the offers
and claims being created in the system and catch
inconsistencies
People
Followed crawl-walk-run approach to train users on the
new tool and engaged them starting from the
CRP1through CAT
Adopted train the trainer approach to train others and
new hires
Technology
Automated Trade Promotion process using Channel
revenue management which has standard integration with
Pricing, OM, AR, AP, SLA, GL and other modules
The solution is deployed with pure Oracle vanilla out-ofbox functionality in R12.1.3
Reports in OBIEE were developed to provides users real
time visibility into rebates and liabilities for both shipped
and backlog orders
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Solution
Impact
Process
Established standard template for all offers which also took into
account regional variances
Performed GL account consolidation for multiple liability and expense
accounts into on global account
Account reconcilers were also consolidated
Execute
Corporate guidelines were
established and communicated to ensure
Plan
no direct journal entry into GL
Responsibility to process claims was also shifted from Accounts
receivables to Go-To-Market finance
Established a monthly cadence call with sales and finance operations
team to review actuals vs. plan and whether any adjustments are
required prior to month end
Governance
People
Standardized processes
Integrated solution provides
comprehensive visibility which is
imperative for successful channel
revenue management.
Complete traceability and auditability
Users were able to proactively find
exceptions and react on-time
Subledger is always in sync with your
GL making reconciliation easier
Reduced month-end close by 2 days
Technology
Monitor Utilization and Earnings for promotions offers in Trade
Management
Established two key OBIEE reports that would provide insight into
current liabilities and expenses incurred for both shipped and backlog
order
Mandated use of Offer adjustment feature to make any mid-term
adjustments
16
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Product Feature
1
2
Complete traceability on
promotion adjustments
from subledger to GL
17
Benefits
This presentation should not be interpreted as a representation about or endorsement of any third party products, including Oracle software.
Accurate revenue
forecasting and ASP
(Average Selling Price)
at any given time
Complete audit trail
No manual GL
adjustments required
Whats Next
Future Directions
August 2014
Copyright 2014, Oracle and/or its affiliates. All rights reserved. | Restricted to event use only.
18
Questions and
Answers
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