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I’ve been working with commissions for well over 20 years now and have heard the following forever:  Excel is prone to error and is not a reliable commission system.  Further, Excel has a 6% (from some study from someone) error rate.

We can help you reduce that error rate by implementing NEWCOMP system.  Let me start out with the Excel fallacy.  If you are looking to replace your Excel system with anything because of your error rate, unless you change something about how you handle your data, the errors will just move their way to the new system.

People have been using Excel as their comp system forever since computers became useable and Lotus 123 took control of the market.  What can you do in Excel? You can do the math, and generally, it is accurate and calculates in real-time.  It will also update reports that are referenced in real-time also.  It has macros, which allow for workflow and is relatively robust as a reporting application.  If you don’t believe me on that, what do we mock most of our reports up in?

So let’s expand further into Excel as a commission system. If it is so bad, so wrong, why is it the system of record when confirming the calculations of most other commission systems?  We use them to model the plans, to run the test calculations, to give examples, and obviously to use as a verification tool.  It’s also used as a sole commission system for many small and large businesses around the world.  Every commission system I have ever installed at every company has had Excel or some type of spreadsheet program.

If it is so bad, why is it the system of record when confirming the calculations of most other commission systems?

So where does it fall down?

Generally, it fails when you try to put too much information into one file, or if you want to have a SOC compliant audit trace.  If you want to do more advanced analytics and visualization it isn’t as good as some tools that are out there but given you have Microsoft power apps, this integration may make this a moot point.  Last, it doesn’t have a consistent theme of a build, which makes it susceptible to one person who knows the application, and they leave.  You could also say it lacks a proper login and distribution method, but again that could be covered by MSFT power automated tools.

If you are considering a commission system, it should definitely have qualities that surpass Excel.  Our next article is going to be a convenient solution selection comparing different commission calculation applications.  When creating a holistic commission system, you should envision what you have now and what it should look like going forward, where you want one application to manage the work, and where you want the best of the breed to manage.