3 of 5:Top 5 Mistakes Collecting SPM / EIM Project Requirements

It’s important to identify the true subject matter experts and speak to them. There are a lot of tourists roaming the streets eager to share what they know. Tourists have read all the guides and made a couple of day trips. They know more than you and they can sound very confident, but beware, they don’t live here. They don’t know that 5th Street is a one-way going south of Elm or that the Bob’s Big Boy landmark they’re using burned down two months ago. You need a native to give you details; only a native knows everything. At companies, there are many tourists roaming the halls with abundant enthusiasm and misinformation.

The Problem

Once again we like to pull information from those willing to give it. A fundamental problem with this approach is that it’s often the busiest and least available individuals to whom we really need to speak. I learned my lesson the hard way. This is a true story.

I once did an SPM project from beginning to end where I was in charge of collecting requirements and building out the compensation rules. When we began the project we were able to schedule time with the Director of Compensation (in HR) and she was thrilled to get started. She had a lot of dreams and aspirations for this project and was happy to share them. This Director had a very detailed understanding of the plans — she designed them. I thought we were in great shape. In a relatively short amount of time we were able to walk through all the compensation plans and document exactly how they were supposed to work. The project was on schedule and everyone was pleased. We knew the Director of Comp had a team of compensation admins working under her, but we were told they were too busy doing their “day jobs” to spend any time with us. We felt good about the information we were getting so we let it slide.

Fast forward. Three months later we had fully built, unit tested and system tested the new implementation. We were on schedule to begin User Acceptance Testing. This would be the first time the comp admin team had seen the new application outside of some standard training. I remember being jazzed up about showing off what we had done. My enthusiasm faded quickly. The first admin walked into the computer lab and began to laugh.

She said, “I can’t wait to see how you designed the historical annuities commissions, you didn’t even talk to me about it and I’m the only one who knows how to do it.”

I was floored. It turns out we didn’t have the “real” requirements for calculating a vast majority of the plans. The Director of Compensation was giving us the current and future requirements, but they wouldn’t super-cede legacy agreements. In fact, this Director didn’t even know about most of the stuff going on with her own team. She had only been there a year. She was still a tourist. Needless to say, UAT had to be delayed and we fell way behind and I learned a valuable lesson.

The Solution

The first question you should ask after the formal greetings is “who actually calculates the incentive compensation?” Technically, this question should be asked even earlier so you can book time with those people. Usually this is a compensation administrator or analyst. This is typically NOT a manager or director. Managers and directors know how their plans are “supposed” to work. They likely are unaware of how they actually get calculated. Many organizations have compensation processes that are riddled with exceptions and legacy entitlements. These are rarely part of the standard compensation plan document. In fact, they may not be documented at all. If it goes into a paycheck, then the admin knows about it and they can’t wait to see how you’ll build that into the new system.

In many cases, management doesn’t even realize this “old” stuff is going on. Collecting these requirements could shed a lot of light on the situation and identify areas for improvement.