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SAP Solution in Detail mySAP ERP ENTERPRISE COMPENSATION MANAGEMENT WITH mySAP™ ERP

BWP SID Enterprise Compensation

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Page 1: BWP SID Enterprise Compensation

SAP Solution in DetailmySAP ERP

ENTERPRISE COMPENSATIONMANAGEMENT WITH mySAP™ ERP

Page 2: BWP SID Enterprise Compensation

© Copyright 2004 SAP AG. All rights reserved.

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Executive Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Building an Enterprise Compensation Management Strategy . . . . . . . . . . . . . . . . . . . . . . . . . 4

Complete Enterprise Compensation with mySAP ERP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Budgeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Compensation Administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7– The Compensation Plan Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7– The Back-End Flow of the Compensation Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9– Compensation Planning for Front-End User Processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Long-Term Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11LTI Interfaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Job Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

At-a-Glance Enterprise Compensation Management Infotypes and Architecture Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

SAP Employee Self-Service and the Total Compensation Statement . . . . . . . . . . . . . . . . . . 15

Complete Reporting Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

The Advantages of Integrated Enterprise Compensation Management . . . . . . . . . . . . . . . 17

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CONTENTS

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An enterprise compensation management strategy is crucialfor dealing with a rapidly changing business climate andmaking the most of human resources in the best – and worst –of economic times. mySAP™ ERP Human Capital Management(mySAP ERP HCM) provides a complete solution for enterprisecompensation management, budget handling, compensationadministration, long-term incentives, job pricing, andreporting.

In an expanding economy, human resources are scarce, and it’s important to attract and retain the best people. In arecessionary economy, human capital is a major expense thatneeds to be controlled effectively. But no matter what theglobal economic situation may be, you need maximum insightand flexibility to manage enterprise compensation. You alsoneed the ability to adapt dynamically to ever-changingcircumstances.

With a comprehensive compensation management solution,you can define a strategic compensation policy that appliesthroughout your enterprise – one that motivates employees tosupport business goals, allows you to respond to change, andimproves your company’s bottom line. And one that enablesyou to track, monitor, plan, simulate, and execute that strategyprecisely. A comprehensive compensation managementsolution achieves this by integrating all relevant humanresources (HR) processes, including the administration of fixedand variable pay, long-term incentives (LTIs), performancemanagement, compensation budgeting, personnel costplanning, salary benchmarking, and payroll.

EXECUTIVE SUMMARY

BUILDING AN ENTERPRISECOMPENSATION MANAGEMENT STRATEGY

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With mySAP ERP Human Capital Management (mySAP ERPHCM), you can maximize the value of your employees and alignemployee skills, activities, and incentives with business objectivesand strategies. mySAP ERP HCM also provides the tools to man-age, measure, and reward individual and team contributions.

By leveraging integrated HCM tools, you’ll gain insight into –and control over – increasingly virtual workforces. Adapt yourworkforce and IT investments quickly and easily. And signifi-cantly improve productivity as employees focus more time onvalue-added activities.

mySAP ERP HCM supports processes for recruiting, deploying,developing, motivating, and retaining valuable employees,improving these processes from end to end.

mySAP ERP HCM offers a complete, integrated compensationmanagement software solution that helps enterprises of allindustries, sizes, and complexities to implement strategic

compensation techniques and achieve their strategic goals. The solution can help you build effective employee compen-sation programs and support your company’s compensationmanagement processes. With numerous integration points,mySAP ERP HCM is a true end-to-end solution that powers afully integrated enterprise compensation management process.mySAP ERP HCM supports the major areas in enterprisecompensation management: budgeting, compensation admin-istration and planning, long-term incentive administration,and job pricing.

To implement all SAP enterprise compensation managementfunctionality of mySAP ERP HCM, you must implement some of its personnel administration and organizationalmanagement functionality. mySAP ERP HCM provides basicreporting capabilities, but for complete HCM analytics, youmust install the SAP® Business Intelligence component of theSAP NetWeaver™ platform, as well.

COMPLETE ENTERPRISE COMPENSATION WITH mySAP™ ERP

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SAP STRATEGIC ENTERPRISEMANAGEMENT

mySAP™ ERP HCM

SAP NetWeaver

BALANCED SCORECARD• Define enterprise goals

SAP® BUSINESS INTELLIGENCE • Analysis and reporting

PERSONNEL COST PLANNING & SIMULATION• Plan costs & generate compensation budgets

COMPENSATION BUDGETING • Create & distribute compensation budgets

COMPENSATION ADMINISTRATION/PLANNING/REVIEW PROCESS • Perform compensation reviews and LTI granting

OBJECTIVE SETTING &APPRAISALS• Define team & individual goals• Monitor and evaluate goals

achievement

LTI ADMINISTRATION• Grant & administer LTIs

SALARY BENCHMARKING• Participate in salary surveys• Perform job pricing• Maintain salary structures

Figure 1: Overview of the Fully Integrated SAP Enterprise Compensation Management Solution

PAYROLL • Update payroll & master data mySAP ERP CORPORATE SERVICES

INCENTIVE & COMMISSIONMANAGEMENT (ICM)• Calculate sales commissions

and incentives

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To take advantage of mySAP ERP’s extended enterprisecompensation management functionality and to implementthe most robust enterprise compensation management solutionthat SAP has to offer, you should implement the followingfunctions and applications available with mySAP ERP:

• The objective setting and appraisals functionality of mySAP ERP HCM

• The personnel cost planning and simulation functionality ofmySAP ERP HCM

• The payroll functionality of mySAP ERP HCM

• SAP Employee Self-Service and SAP Manager Self-Service

• SAP Incentive and Commission Management

• SAP Strategic Enterprise Management (SAP SEM)

Compensation management is closely linked with the solution’sobjective setting and appraisals functionality, so you can auto-matically determine the appropriate rewards when employeesachieve particular goals.

Personnel cost planning and simulation functions help youinitially structure and compose compensation budgets.

You can directly transfer the results of sales commissions fromthe SAP Incentive and Commission Management application ofmySAP ERP to your payroll system for distribution to your em-ployees. The results can also be displayed in the compensationplanning tool in the SAP Manager Self-Service application somanagers have a complete picture of the remuneration theiremployees receive.

For detailed compensation-related analysis and decisionsupport, the SAP Business Intelligence component of the SAP NetWeaver platform provides specific compensationdatasets. The reports and analyses you need are based on thesedatasets.

With mySAP ERP HCM, your compensation specialists cancreate budget structures for merit increases, performancebonuses, and long-term incentives (LTIs). You can then allocatethe budget pool of money (or the number of awards in the caseof LTIs) among the different budget units in your company.

Compensation specialists can automatically generate budgetstructures that are representative of your organizationalstructure. When required, they can manually edit the structure.When line managers plan and execute their employees’ per-formance awards, they can view these compensation budgets. As they make changes, mySAP ERP HCM increments the spentvalue of the budget against the original distributed budget. This ensures managers follow budget policy and allows you tomonitor compliance. You can configure mySAP ERP HCM toallow or to prevent line managers from exceeding their budgets.

The controlling unit of an organization usually managescompensation budgets. You can obtain planned HR expenses by using the personnel cost planning and simulation tool inmySAP ERP HCM. Because compensation budgeting andpersonnel cost planning and simulation are integrated, mySAP ERP HCM can automatically generate compensationbudgets with data that comes directly from the respective costitems defined in forecasts of HR expenses. Implementing thisfunctionality saves valuable time and effort when you createcompensation budgets. It also allows for detailed, bottom-upbudgeting in addition to traditional top-down budgeting.

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BUDGETING

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Figure 2: Compensation Budget Maintenance with mySAP ERP

You can manage the status of compensation budget structures,ensuring that the pool of money assigned can be used by linemanagers only after final approval and release.

You can also reassign budget amounts during organizationalchanges from the time the budget is released to its totaldepletion. This function allows you to reassign the total dis-tributed and spent budgeted amount to another organizationalunit.

You can keep track of budget distribution and usage across alllevels of your organizational structure using the budgetauditing report.

Compensation Administration

With mySAP ERP HCM, you can define and configure compen-sation plans that adhere to your corporate policies. You can alsoflexibly handle exceptions, when applicable.

Line managers access compensation plan information via thecompensation planning front-end tool in the SAP Manager Self-Service application. Within this Web-based tool, managerscan simulate, plan, and adjust compensation for theiremployees. Line managers and approving managers cancollaborate on proposed rewards and adjustments using built-in approval functions.

The Compensation Plan Structure

The central entity of compensation administration is thecompensation plan, which is part of a compensation program.Employees are assigned to compensation programs via the Com-pensation Program Infotype 0758. A compensation plan describesthe rules and structure of conditions of your employees’ com-pensation and how it is treated in the compensation administra-tion process. Rules include eligibility, guidelines, and proration.

For payroll integration, each compensation plan is assigned to acompensation category, and the payment (or number of LTIawards) is stored in the corresponding payroll and compen-sation infotypes. The compensation categories are:

• Salary adjustment: Basic Pay (Infotype 0008)

• Regular bonus: Additional Payments (Infotype 0015)

• Off-cycle bonus: One-Time Payments Off-Cycle (Infotype 0267)

• LTI grant: LTI Grant (Infotype 0761)

In addition, you can apply company-specific infotypes by using a business add-in.

With mySAP ERP HCM, you can review compensation informa-tion, including the attributes stored, the review period, and theselection period. You can also define intervals during which amanager is allowed to process a compensation plan, which isreferred to as compensation review.

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COMPENSATION

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The combination of compensation review and compensationplan forms a new compensation review item. An example of acompensation review item is an award that has to be presentedwithin a certain time frame and takes into account employeeswho have been with the company for a specified time period. Amanager can only select a given review during that valid periodof time. The selection period dates define the time period onwhich the selection of employees is based.

If a review is flagged as an “any-time” review, then you canprocess a compensation plan several times throughout the yearand more than once within a certain time frame. This approachis typically used to implement spot bonus programs.

You can also define compensation plans globally. Depending onthe country, you can assign specific employee attributes. Themain attributes of a compensation plan are the following:

• EligibilityEligibility rules determine whether an employee can receive areward against a certain compensation plan. If an employeefulfills the detailed criteria defined for eligibility, such asservice requirements, job, pay scale and grade, appraisals, and target achievements, that employee is considered to beeligible. You can override the evaluation of this criterionusing a special infotype – Eligibility Override (Infotype 0760) – which manages exceptions handling. The evaluation ofeligibility can be both time period and date specific.

• GuidelinesGuidelines determine default values that should be given toan employee according to your compensation policy andregulations. You can use amounts, percentages, or numbersof LTI awards. Guideline values can be based on differentcriteria, such as an appraisal rating, specific target achieve-ments, or for example, the compa-ratio of an employee. Youcan combine up to three criteria when you define a guideline,which allows you to build a multidimensional matrix for theguidelines. You can configure guidelines to allow managers tooverwrite the default values. The solution can also suggestdefault ranges, and managers can choose final values withinthose ranges. You can also define whether managers shouldbe allowed to go beyond those ranges or not.

• ProrationIf an employee has fulfilled the eligibility requirements for a particular compensation plan during only a part of theevaluation period, you can reduce the suggested guidelinevalue based on the fraction of time during which the require-ment was fulfilled. This reduction is called proration and isenabled by applying a proration rule to an existing guidelinerule. The evaluation period is a time interval upon whicheligibility and proration evaluations are based. Its beginningand ending dates are attributes of the compensation reviewitem.

• RoundingYou can configure the rounding type and amount for eachcompensation plan, after which rounding takes placeautomatically.

• Cost itemYou can assign cost items from the personnel cost planningand simulation tool of mySAP ERP HCM to a compensationplan. This integrates values from the compensation guidelinesfor the data collection in cost planning and forecasting.

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The Back-End Flow of the Compensation Process

The Compensation Process Infotype (0759) serves as a commonsource to store and administer the compensation process flowfor all adjustments. The solution automatically creates thisinfotype when a manager saves a proposed reward using thecompensation planning sheet in the SAP Manager Self-Service(MSS) application. You can create or change a secondary info-type record only after it is activated, which is carried outcentrally by the HR department. The infotype that is updateddepends on the category for payment defined in the compen-sation plan. The infotype can be Salary Adjustment (0008),Regular Bonus (0015), Off-Cycle Bonus (0267), and LTI Grant(0761), which is sent to the bank for further processing. The LTI Exercising Infotype (0762) is needed to store exercising datacoming back from the bank. More details of the LTI design aredescribed in the following discussion of long-term incentives.Figure 3 gives an overview of this compensation process.

Figure 3: Architecture of the Compensation Process and Infotypes

Compensation Planning for Front-End

User Processes

The solution includes two different user interfaces to supportcompensation processes for line managers and HR adminis-trators. Managers can access a new version of the SAP ManagerSelf-Service application. By using the HR master data mainte-nance transaction, compensation specialists can maintaincompensation transactions directly on the CompensationProcess Infotype (0759). Mass processing of rewards is alsoavailable.

The line manager’s user interface captures information onemployee performance, jobs, salary guidelines, budgets, andmuch more. It provides expert knowledge and situation-specificguidance in an intuitive, user-friendly format and enables more efficient salary planning across the enterprise. It includeseverything managers need for visibility and control overcompensation budgets. Line managers can access expertinformation and resources to make strategic, equitable, policy-based compensation decisions.

For employees eligible for a specific compensation plan,managers can change the compensation data, such as theamount or percentage for monetary plans, or the number ofgrants for LTI plans and the effective date provided that youallow this. In addition, they can perform any of the followingfunctions:

• Enter compensation data

• Apply percentage

• Clear entries

• Apply guideline

• Raise employees to minimum of salary range

• Select a new currency

• Create and store notes for each employee

• Save compensation data

• Submit compensation data

• Exit

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MSS User Interface Salary/Bonus/LTI

Business LogicCompensation Process

IT 0759Compensation Process

IT 0267Off-Cycle Payments

IT 0761LTI Grant

IT 0762LTI Exercising

IT 0008Basic Pay

IT 0015Add’l Payments

SAVING

ACTIVATION

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SAP Manager Self-Service fully supports the approval process.The following functions are available:

• Approve

• Reject

• Check planned compensation

• Store notes for each employee

• Exit

There are two ways to determine which columns of informa-tion appear on the SAP Manager Self-Service screen. You canconfigure the columns in the back-end through configuration,and managers can easily personalize the columns provided afterimplementation. The main standard SAP-delivered columnscontain the following data:

• Appraisal data

• Commissions (Infotype 0579)

• Compa-ratio (current)

• Percent in range (current)

• Guideline

• Hire date

• Job

• Name

• Position

• New salary

• New compa-ratio

• New percent in range

• Notes

Special function modules fill the columns dynamically. Cus-tomers can easily define and fill columns with customer-specificdata if required.

Figure 4: Sample Column Setup for a Salary Adjustment Plan Within SAP Manager Self-Service

You can display any kind of compensation-related informationon each employee just by clicking on their name. You can alsographically display comparisons of planned, actual, and surveysalary data, the distribution of planned compensation changes,and compensation histories.

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With mySAP ERP HCM, you can create and manage long-termincentives.

LTI administration is integrated with compensation adminis-tration functions, which delivers several advantages:

• You can grant and approve LTI awards from SAP ManagerSelf-Service.

• You can budget for LTIs as you can for salary increases andbonuses.

• You can use the guidelines and eligibility requirements usedfor compensation administration to grant LTIs.

The LTI plan is one possible type of compensation plan. LTIplans have the following primary attributes:

• Vesting scheduleDetermines when awards are vested so employees can exercisethem. This vesting schedule is valid for an entire LTI plan andcan also be overwritten at the individual level in the LTIGrant Infotype (0761). The vesting schedule is sent toaccounting and to your company’s bank or broker.

• Exercise windowsDescribe periods of time during which employees can exercisetheir awards. The exercise window rule is assigned to an LTIplan. The exercising window rules from customization can be overwritten on the LTI Grant Infotype (0761) to handleexceptions at the employee level. The exercise window ruleinformation is sent to the bank via a standard bankinginterface.

• Exercise priceThe exercise price flag determines whether the exercise priceis determined at the date of exercise or is to be maintained inthe LTI Grant Infotype (0761) at the time of granting.

LTI Infotypes 0761 and 0762 are for granting and exercising,respectively. As mentioned above, the LTI Grant Infotype isfilled when you activate the Compensation Process Infotype(0759), which is created automatically when LTIs are granted by

a manager in SAP Manager Self-Service. The LTI ExercisingInfotype (0762) contains the data about the exercising of LTIs,which comes from the bank via a standard banking interface.

The Participant Data Infotype (0763) contains LTI plan partici-pant information that is to be sent to the bank. You can storethe following information:

• Insider

• Director

• Owner percentage

Life events can influence the expiration date and the vestingschedule of an LTI plan for an employee. The HR administratorcan maintain the life event and its effects by running the appro-priate report provided for life event processing, for example, thevesting schedule changes on the LTI Grant Infotype (0761).

Figure 5: Integration Points and Infotypes Affected by the LTI Process

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LONG-TERM INCENTIVES

Line Manager

AccountingDepartment

Payroll Results

CompensationProcess (IT 0759)

HR Administrator

HRExecutive

Cancel LTI Plan

CompensationSpecialist

AccountingInterface

Payroll

Reporting

SAP® BIExtractor

ConvertStock Unit

LTI Exercising(IT 0762)

HR Administrator

LTI Grant (IT 0761)

Activation ofInfotype 0759

Granting in MSS

Interface ofexercising data

from bank/broker

Bank/Broker

LTI ParticipantData (0763)

Interface ofgranting data

to bank/broker

DATA FLOW DIAGRAM OF THE LTI FUNCTIONS

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LTI Interfaces

mySAP ERP HCM has LTI interfaces to the following areas:

• AccountingThe solution provides a function module to the accountingcapabilities of mySAP ERP. The accrual engine needs LTI datato compute provisions for awards.

• The bankThe solution provides an outbound interface for LTI grantingand participation data and an inbound interface for exercisingdata for data exchange with banks and brokers. These inter-faces are XML interfaces and are compliant to the standards ofthe HR-XML Consortium.

• BudgetingAllocated and spent budgets can be converted as a conse-quence of a stock split. Therefore, budgeting needs to use anLTI function module to convert budgets from one stock unitinto another.

• SAP Business Intelligence (SAP BI)SAP BI handles granting, exercising, and vesting data. You callthe appropriate extractors from SAP BI and adjust them tothe new data model.

• Compensation administrationLTI functions are closely connected to compensation admin-istration. An important program interface between the twofunctions is the activation process of the CompensationProcess Infotype (IT 0759). The LTI function provides afunction module as part of the activation. Compensationadministration uses LTI function modules to convert thenumber of awards from one stock unit to another.

• PayrollPayroll evaluates the LTI Exercising Infotype (IT 0762). Youdefine the wage types for the respective amounts and thepayroll engine can calculate the appropriate tax. The taxcalculation is delivered in the international payroll engine,along with specifics for German and U. S. regulations.

• Total compensation statementThe total compensation statement shows the number ofgranted awards and the granting date. This data is read fromthe LTI Grant Infotype (IT 0761).

mySAP ERP HCM delivers extensive salary benchmarkingfunctions so your compensation professionals can analyze yourcompany’s pay policy and pay structure for market competitive-ness. They can also determine the best possible compensationstrategy revisions, quickly and accurately.

SAP has developed a new job pricing tool for compensationspecialists. With this tool they can:

• Create and maintain an unlimited number of salary surveyproviders

• Import and store salary survey data from any number ofproviders, update data as needed, and maintain a history ofprevious market data

• Age salary survey market data

• Match internal benchmark jobs to survey jobs from multiplesalary survey providers

• Apply a weighting factor against various matched jobs fromdifferent providers

• Establish market composite results for jobs and compareinternal salaries against blended market data supported bygraphical tools

• Adjust internal salary structures based on market findings,including performing regression analyses supported bygraphical tools

• Extract company compensation data to participate in salarysurveys

• Link to SAP Business Intelligence to run sophisticatedanalytics and reports

Figure 6 shows the job pricing business process, including all thesteps involved and supported by mySAP ERP HCM.

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JOB PRICING

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Figure 6: Overview of the Salary Benchmarking Business Process

Once you have imported market data from the surveyproviders, you create market composite results. This infor-mation is stored in the new composite Survey Result Infotype(IT 1271) for each internal benchmark job. You can thencompare market pay and your company pay for employees,positions, or jobs. You can create multiple composite results, so you can compare different market movement assumptions,provider weightings, and market data aging factors.

Figure 7: Comparison of Market Composite Result to Employees’ Payment

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JOB ANALYSIS

• Create internal jobs and job descriptions

SELECT SURVEYPROVIDER• Organization decides

which salary surveys to participate in

RECEIVE SURVEY DATA SUBMISSIONFORM (ONLINE, DISK,EXCEL, ETC) FROMSURVEY PROVIDERS

IMPORT DATA• Upload job catalog,

descriptions, and market data to the system

JOB MATCHING• Match internal jobs

to survey jobs

AGE DATA• Age market data to

evaluation date

DETERMINE MARKETGAP• Identify which jobs or

job families require adjustments

PHILOSOPHY

• Determine or createcompensation philosophy

ADJUST SALARYSTRUCTURE• Create proposal for

salary structure adjustments to “lead” or “lag” the market

ACTIVATE ADJUSTMENT• Adjust the current

salary structure with the new structure

IDENTIFY TARGETS

• Create market targetsfor certain jobs or job families

WEIGHT DATA

• Weight market datafrom different providers

COMPILE MARKETDATA• Create market

composite result for internal jobs from matched survey jobs

DATA ANALYSIS

• Evaluate and compareto current internal compensation

BUSINESS PROCESS OF MARKET PRICING OVERVIEW (GENERAL)

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You can access and maintain all Infotypes using the mySAP ERPHCM master data maintenance function. The solution includesthe following infotypes for enterprise compensationmanagement:

• Compensation Programs (IT 0758)

• Compensation Process (IT 0759)

• Compensation Eligibility Override (IT 0760)

• LTI Grant (IT 0761)

• LTI Exercising (IT 0762)

• LTI Participant Data (IT 0763)

• Composite Survey Result (IT 1271)

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USERS

FRONT END

BACK END

DATABASE

OTHER SAP COMPONENTS

EXTERNALCOMPONENTS

Figure 8: Overview of the Enterprise Compensation Management Architecture Including User Roles and User Interfaces

EMPLOYEE HRADMINISTRATOR MANAGER

ESS MSSBUDGETING

USERINTERFACE

JOB PRICINGUSER

INTERFACE

HR EXECUTIVECOMPENSATIONSPECIALIST

BUDGETING JOB PRICING

BUDGETS

SURVEYRESULTS(IT1271)

ACCRUAL

BANK/BROKER

SURVEYPROVIDERS

TREASURY MBO/APPRAISALS

BW REPORTING

AT-A-GLANCE ENTERPRISE COMPENSATION MANAGEMENTINFOTYPES AND ARCHITECTURE OVERVIEW

MASTER DATAUSER

INTERFACE

SALARYSTRUCTURES

PERSONNELCOST

PLANNING

COMPENSATIONADMINISTRATION

COMPENSA-TION PROCESS

(IT0759)

LTI ADMINISTRATION

EXERCISING(IT0762)

GRANTING(IT0761)

PAYROLL

TOTAL COMPEN-SATION

STATEMENT

PAY DATA(IT0008 ETC.)

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Using SAP Employee Self-Service, employees can always see atotal compensation statement – the compensation theyreceived from their employer during certain time periods. This statement, which can be customized, can be in multipleformats, including Smart Forms and Adobe Acrobat Reader.The statement can be printed individually or in bulk.

The total compensation statement can include sales commis-sion from SAP Commission and Incentive Management. It listsdata from four different areas within mySAP ERP HCM:

• Payroll, including salary and bonus

• Benefits, including health plans, insurance plans, savingsplans, flexible spending accounts, miscellaneous plans, stockpurchase plans, and credit plans

• Other compensation, including LTIs

• Personnel development, including additional education andtraining and individual development plans

mySAP ERP HCM provides basic reporting capabilities. You canview and format tabular report results in the SAP list viewertool. Using this tool you can:

• Filter data

• Total and subtotal data

• Sort data

• Display data in Microsoft Excel and Crystal Reports

• Define your own report layouts

• Export data to Microsoft Word and Microsoft Excel

By implementing SAP Business Intelligence, you can executemore sophisticated reports that go far beyond these functions.SAP Business Intelligence contains a special enterprise compen-sation management InfoCube (a type of SAP dataset) andqueries that you can use to analyze all of your compensationdata in detail. SAP Business Intelligence delivers more than 30 standard queries with enterprise compensation managementcontent.

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SAP EMPLOYEE SELF-SERVICE AND THE TOTALCOMPENSATION STATEMENT

COMPLETE REPORTINGCAPABILITIES

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THE ADVANTAGES OFINTEGRATED ENTERPRISECOMPENSATIONMANAGEMENT mySAP ERP offers an integrated solution for enterprise com-pensation management that delivers the following advantages:

• Broad, real-time, and reliable information availability andexchange for decision making

• Strategic personnel management and support for your overallenterprise strategy

• Integration with all vital SAP components inside and outsidemySAP ERP, as well as with third-party interfaces, ensuringcommunication with all parties involved and full support ofthe entire enterprise compensation management process

• Improved productivity through user-centric applications thatensure HR professionals and managers have the right toolsand an easy-to-use interface

• Unlimited reporting capabilities through standard reports,extensive SAP Business Intelligence reports, and ad hoc querycapabilities so you can take immediate action when required

• Flexible customizing to ensure that you can set up all possiblecompensation plans according to your specific needs

And the advantages just keep coming. To help you cope withchange, SAP continuously improves mySAP ERP. Enhancementsto the solution’s enterprise compensation management featuresand functions will ensure an even greater ability for your com-pany to implement a flexible strategic compensation policy,supported by a comprehensive compensation managementsolution that helps you achieve your goals.

To learn more about mySAP ERP, visit the SAP Web site atwww.sap.com/solutions/erp

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www.sap.com/contactsap

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