Jan. 22, 2013–Scottsdale, Ariz.–When it comes to setting sales quotas, “last year plus” is the most prevalent quota-setting approach for the majority (84%) of organizations. This was one of the key findings of the “Quota Practices Study” by WorldatWork and Better Sales Comp Consultants (BSC).
“Setting sales quotas using a %+ formula doesn’t take into account global, national and regional market factors, salesforce performance, and other critical drivers,” said Jim Stoeckmann, a Certified Sales Compensation Professional (CSCP)(TM) and practice leader for WorldatWork. “One would expect the economy to be a key factor in sales quota setting but our study revealed that the current economy has no impact on quota adjustments.” Top drivers of quota adjustments are disruptive changes to market (55%), coverage model (54%), and errors in quota setting (43%).
“Companies rarely make quota adjustments during the performance cycle, unless there is a dramatic change in business conditions, like the financial crises in 2008 and 2009,” explained Ted Briggs, Principal, Better Sales Comp Consultants. “Even then, many companies maintained quotas and used other tools such as contests or spiffs to supplement sales compensation.”
About the Study
Data for the Quota Practices Study were collected between January-August 2012. More than 80 respondents participated, primarily sales operations and sales compensation managers from publicly traded companies (72%) and the private sector (25%).
For additional resources, visit:
Sales Quota Setting
About Better Sales Comp Consultants
BSC is a boutique consulting firm focused on creating better sales compensation programs and better sales effectiveness for clients. www.bettersalescomp.com
The Total Rewards Association
WorldatWork (www.worldatwork.org) is a nonprofit human resources association for professionals and organizations focused on compensation, benefits, work-life effectiveness and total rewards – strategies to attract, motivate and retain an engaged and productive workforce. WorldatWork and its affiliates provide comprehensive education, certification, research, advocacy and community, enhancing careers of professionals and, ultimately, achieving better results for the organizations they serve. WorldatWork has more than 65,000 members and subscribers worldwide; 95 percent of Fortune 500 companies employ a WorldatWork member. Founded in 1955, WorldatWork is affiliated with more than 70 local human resources associations and has offices in Scottsdale, Ariz., and Washington, D.C.
WorldatWork Society of Certified Professionals(R) is the certifying body for six prestigious designations: the Certified Compensation Professional(R) (CCP(R)), Certified Benefits Professional(R) (CBP), Global Remuneration Professional (GRP(R)), Work-Life Certified Professional(R) (WLCP(R)), Certified Sales Compensation Professional (CSCP)(TM) and Certified Executive Compensation Professional (CECP)(TM).
The WorldatWork group of registered marks also includes: Alliance for Work-Life Progress or AWLP, workspan and WorldatWork Journal.