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Glossary Terms
Compass - The Only Sales Glossary You Need
Commission software, also known as sales commission software or compensation management software, is a type of tool or system designed to automate and streamline the process of calculating and managing commissions for salespeople or other individuals involved in incentive-based compensation structures.
This type of software is commonly used in organizations where employees receive commissions or bonuses based on their sales performance or achievement of specific goals.
Commission software is a specialized tool designed to automate, calculate, and manage sales commissions for individuals or teams. It streamlines the complex process of determining payouts based on various factors such as sales performance, targets, and specific incentive structures.
The key features of commission software include:
The benefits of sales commission software are:
It ensures accuracy in commission calculations, reduces disputes, and saves time by automating complex payout structures. This builds trust among employees and sales partners and motivates them with timely, transparent payments.
Using commissions software also provides real-time visibility into performance metrics, enabling better decision-making.
Businesses should adopt a commission tool when they scale beyond manual tracking, experience frequent errors in payouts, or need to manage multiple commission structures across teams or geographies. It becomes essential when managing recurring commissions, tiered rates, or incentive-based compensation.
A commission software integrates with CRM and payroll systems to gather sales data, apply compensation rules, and calculate commissions automatically. It can handle complex plans like accelerators, draws, and splits. The software usually provides dashboards, approval workflows, and audit trails to simplify oversight and reporting.
