Comments on: Percentage of reps making quota in 2009 dropped to 51.8% from 58.8% in 2008 http://leapcomp.com/2010/02/percentage-of-reps-making-quota-in-2009-dropped-to-518-from-588-in-2008.html Mon, 21 May 2012 17:39:54 +0000 http://wordpress.org/?v=2.6 By: Donya Rose http://leapcomp.com/2010/02/percentage-of-reps-making-quota-in-2009-dropped-to-518-from-588-in-2008.html#comment-31155 Donya Rose Wed, 10 Feb 2010 19:15:59 +0000 http://leapcomp.com/?p=1137#comment-31155 I agree with Dave that many sales organizations dealt with the downturn by culling their sales teams, enlarging territories, and doing what they could to keep their "keepers" productive, earning and worth their keep to the company. The general inclination in the face of uncertainty is to set quotas at the highest reasonably believable level, then reserve the right to do "something" about the under-earning if quotas turn out to be too high. The "something" is all too often a SPIFF to add comp and create a selling frenzy at year-end (or quarter-end). So many of our comp plans are goal/quota-based, and we have expectations about what our performance distributions should do. In the face of uncertainty, we should expect less accuracy in the quotas resulting in wider performance distributions. Because of this, comp designers must pay careful attention to affordability across the full range of likey levels of quota attainment. And careful attention to pay levels and flight risks must also be maintained to ensure good awareness of the effects of these compensation fluctuations on retention of key talent. It's a tricky moment in compensation management - with some good puzzles and myriad wrong answers... I agree with Dave that many sales organizations dealt with the downturn by culling their sales teams, enlarging territories, and doing what they could to keep their “keepers” productive, earning and worth their keep to the company.

The general inclination in the face of uncertainty is to set quotas at the highest reasonably believable level, then reserve the right to do “something” about the under-earning if quotas turn out to be too high. The “something” is all too often a SPIFF to add comp and create a selling frenzy at year-end (or quarter-end).

So many of our comp plans are goal/quota-based, and we have expectations about what our performance distributions should do. In the face of uncertainty, we should expect less accuracy in the quotas resulting in wider performance distributions. Because of this, comp designers must pay careful attention to affordability across the full range of likey levels of quota attainment. And careful attention to pay levels and flight risks must also be maintained to ensure good awareness of the effects of these compensation fluctuations on retention of key talent.

It’s a tricky moment in compensation management - with some good puzzles and myriad wrong answers…

]]> By: Dave Carlson http://leapcomp.com/2010/02/percentage-of-reps-making-quota-in-2009-dropped-to-518-from-588-in-2008.html#comment-30756 Dave Carlson Thu, 04 Feb 2010 23:07:09 +0000 http://leapcomp.com/?p=1137#comment-30756 hmmm... What I have observed is not a great deal of re-goaling, but more on the territory change side. If you had 100 sales people with 1 million each, but expected revenue to fall to 80 million, quota was kept the same, (or raised) but headcount was reduced to 80 and territories re-aligned. I can only support that from anecdotal information. It would be interesting to do a poll to see how many companies expect/want their sales people to make quota. What is the expected distribution curve? hmmm…
What I have observed is not a great deal of re-goaling, but more on the territory change side. If you had 100 sales people with 1 million each, but expected revenue to fall to 80 million, quota was kept the same, (or raised) but headcount was reduced to 80 and territories re-aligned. I can only support that from anecdotal information.

It would be interesting to do a poll to see how many companies expect/want their sales people to make quota. What is the expected distribution curve?

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