Incentive Compensation - EBS (MOSC)

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Setting up Comensation Cycles in Peoplesoft 9.2

in Incentive Compensation - EBS (MOSC) Question

I am trying to determine the best way to setup our annual merit cycle. We are heavily paper driven and want to automate the process.  It seems like there are many different ways to do this in PeopleSoft. We are on PeopleSoft 9.2 PeopleTools 8.55,

Can someone tell me the differences between the below?

1. Compensation --> Compensation Cycles - Adminster Cycle

2. Compensation -> Base Compensation -> Merit Increases

Thank you

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