If I enable the decay feature will the DKP start decaying from the day I enable it or the date the DKP was first granted?

From the beginning. It works retroactively, and the decay process runs at night (enabling it won't show the results immediately).

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I see. We wanted to give our guildies some time to adjust to the new DKP site before enabling the decay feature since we have never used anything like it before. I had planned to turn on decay in the beginning of September but, if I understand you correctly, that would retroactively decay all the DKP starting from 8/19/08 which is our first raid in the system. I'm pretty sure that this would garner a large number of complaints.

If I set the Full Period Length variable to 12 days (8/19-9/1) would that force the system to compute the decay starting September 1? If so, would I then be able to, on 9/2, be able to set the Full Period Length variable to something else without it recomputing decay from 8/19?

In other words, what is the best way to set the system up so that DKP starts to decay from a date we specify instead of from the date of first raid?