2921300 - Gates & Accelerators - Variable Pay

This article explains the use and configuration of gates and accelerators within Variable Pay.

**Image/data in this KBA is from SAP internal systems, sample data, or demo systems. Any resemblance to real data is purely coincidental**

SAP SuccessFactors Variable Pay

Variable Pay plans can contain features known as "Gates" and/or "Accelerators" which have an impact on a bonus pay-out as a result of some performance criteria’s.
These two options are intended to focus attention onto a specific performance criteria which will result in increased overall Company performance from business goals.
These may also be included individually in a plan, both be included and work independently combined.

Gates are usually defined as a minimum performance level which must be met in order to pay-out on an associated goal, component (section), or the entire plan. 
Gates are often tied to the templates funding mechanism, such as revenue goals, and are used to ensure a minimum level of funding can be achieved before there is a pay-out. 
These are most commonly found in self-funded Variable Pay/Incentive programs.

Accelerators are used to increase the incentive opportunity where certain performance criteria’s are met or exceeded.
When an employee's meets their respective accelerator performance criteria target(s), the accelerator may be applied to the pay-out of the individual goal itself, other goals, other incentive components (sections), or the total plan pay-out.

Below are examples of using Gates and Accelerators.

Gates

Below are the example goals we're using.

Run bonus calculation and launch a worksheet without having any gates enabled/imported.

A breakdown of the calculations are as follows.

Section Amount	25,000
Goals	Weight	Basis	Perform MIN	Perform MAX	Goal Results	Goal Results Pay-out Percent	Goal Results Pay-out Amount
EBITDA	30%	7,500 (25000*30%)	70,261	95,000	95,000	100%	7,500 (7500*100%)
BU Revenue	70%	17,500 (25000*70%)	73,500	94,525	94,525	100%	17,500 (17500*100)

From this the pay-out percentage is 100% as the Goal Result of 95,000 is equal to the performanceMax 95,000.

The Business Caclc Amount from this section overall will be 25,000 (17,500+7,500).

Go back to the template and we now want to enable Gates. This can be from Plan Setup> Settings> Settings> Calculation settings.

To download a sample of what the Gates file looks like, go to Plan Setup> Manage Plan Details> Import/Export Business Goal Weights.

On this page to the right you will be able to download a sample Gates file.

For this example we're going to import the following Gates file. Note, we're using performanceMax in this example however gates would generally be used more on performanceMin.

BONUS_PLAN_NAME	GATE_GOAL_NAME	GATE_METHOD	MULTIPLIER	GATE_LEVEL	TARGET_GOAL_NAME	TARGET_PAYOUT_PERCENT_CAP
USA	BU Revenue	performanceMax	1.2	business_goal	EBITDA	0.9

Please note you MUST have weights imported into the template prior to adding Gates, otherwise you'll see an error on import.

Run bonus calculation and launch a new worksheet.

Here we can now see the EBITDA Goal Result pay-out has changed to 6,750 from 7,500 as well as the percent pay-out being 90% from 100%.

So, based on the gates file we imported why did this pay-out amount and percentage change?

BU Revenue's result is 94,520 and performanceMax is 94,525.

The gates file will get the results from the GATE_METHOD column and * by the MULTIPLIER column.

Gates Calculations	performanceMax*multiplier	Current Result
BU Revenue	113,430 (94525*1.2)	94,525

This calculation is HIGHER than the current goal result, gates will therefore be applied to the TARGET_GOAL_NAME (EBITDA) which is 0.9 (90%) which is contained in the TARGET_PAYOUT_PERCENT_CAP column.

Should this be LOWER than the current results then no gates will be applied to the target goal.

The new Business Calc Amount from this section will now be 24,250 (17500+6750).

Accelerators

You can enable accelerators from Plan Setup > Settings > Settings > Calculation Settings.

Go to Manage Plan Details > Import/Export Business Goal Weights and you'll now have the option to import accelerators. Please note the import file for accelerators is separate to the gates file.

Using the same goals as we used for the gates file, we've defined and imported the following for accelerators.

BONUS_PLAN_NAME	ACC_GOAL_NAME	ACC_METHOD	MULTIPLIER	TARGET_GOAL_NAME	ACCELERATOR_PERCENT
USA	EBITDA	performanceTarget	0.9	BU Revenue	0.2
USA	EBITDA	performanceMax	1	BU Revenue	0.4

Run bonus calculation again and launch a new worksheet.

The calculation of this is as follows.

Business Goal	Calculations	Outcome	Current Result
EBITDA	performanceTarget (70,300*0.9)	63,270	95,000
EBITDA	performanceMax (95,000*1)	95,000	95,000

The accelerator for performanceTarget is LESS than the result of 95,000.
The accelerator for performanceMax is EQUAL to the result of 95,000.

Only one record is a valid accelerator which is the performanceMax as the performanceTarget is lower than the result.

Therefore, we'll take the 0.4 percent and accelerate the target goal of BU Revenue. Therefore, we see the pay-out percentage as 140% as we've added 0.4% on top of the initial percentage of 100%.

The difference between this and gate is here you're acceleratig pay-out rather than capping while using gates.

In the event you have two or more valid accelerators, the system will take the greater percentage to accelerate the target goal.

Additional information

Valid Gate/Accelerator Method:

• performanceMin
• performanceLow
• performanceTarget
• performanceHigh
• performanceMax

Valid Gate Level:

• business_goal
• business_section
• team_section
• individual_section
• final_payout

Download the sample files from Import/Export Business Goal Weights to see the file formats.

What you see in these files is what can be used. For example, you can create a gate on final_payout in Gates however this can not be used in accelerators.

Should you want to download your existing gates/accelerators then you can do so from Reports:

Example of a gates file download.

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