#432 - The Art & Science of Quota Setting: Get It Right or Lose Your Team | 30MPC Playbook (Lead)

Foreign. Everybody.

And welcome to this playbook episode of 30 Minutes, the President's Club. My name is Armand Fouk, and I'm here with my co host, Mark Cosklo. And folks, today we are going to attempt to break down one of the most controversial, complex topics, but most important topics that you can tackle as a sales leader in partnership with your RevOps team and your finance team, which is how. How do you set quotas that motivate your team? Make sure that your top performers stay, make sure that if someone's not performing well, there's a bar for achievement and overall, set quotas that do not make your life miserable by hearing years of complaints from your team. Mark, I guess. Why should people listen? Why?

Well, listen, I would tell you that most sales leaders I know, the way they figure out quotas, they set up a dartboard and they're like, should we do 800k a million or 1.2? They throw a dart and wherever it lands the most, that's what they do. Maybe it's not much more scientific than that. I don't know. We'll talk through it today. But I don't think that there, there is a single thing in your sales team's culture more important than quota. It is a institutional symbol of what good is and what good isn't. And when you get it wrong and not enough people are getting there, it really pushes you down. But when everybody feels like it's attainable and doing it, you know, Rising Tide raises all ships.

That's right. So let's start by first breaking down philosophically, what is fair quota attainment? And then from there, we'll say, once we know what fair quota attainment looks like, 80%, 70%, what have you, we'll talk about how do you forecast and set those initial quotas. And then the final piece that we'll talk about is when you're changing quotas, how do you communicate that? In other words, how often do you revisit quotas? And then when you are revisiting quotas, how do you roll out changes in a way that makes your team feel heard? Today's show is brought to you by Texas, which helps you move your deals forward faster. When timing matters, the fastest way to move a feel forward is to avoid getting st in the inbox. And so my favorite way to get on a text basis is literally when your prospect requests a demo, just send them a confirmation text saying that you're looking forward to the meeting, and that opens the text channel for you to call back on it later. Folks, we put an entire guide on how to revive ghosted deals. Nudge next steps and use texting to keep deals moving forward. With text us, Check it out. It's free in the show notes. So we'll start with what is fair quota attainment? There are two terms that we're going to define up front. There's a difference between attainment and participation. Attainment is what is the average blended quota attainment across all of your reps. So, for example, if one rep does 100% and another rep does 200%, your blended attainment is 150%. Participation is what percentage of reps are hitting quota. If one rep hits 100%, the other rep hits 200%. Your participation is actually 100% because two out of two reps hit quota. So the highest your participation can be is 100%. But blended attainment can be infinitely high. Everyone does 1,000%. You have 1,000% blended attainment, 100% participation. Let's start by talking about attainment percentages, right? So blended attainment. Mark, when you think about what is a fair percent attainment for a team, there's a financial answer and then there's a cultural answer. Why don't we start with the cultural answer? What is healthy attainment before we start pulling out our calculators?

I think that this is where a sales leader needs to kind of have some core beliefs. Do you have the belief that setting a carrot a little too far out causes someone to put in extra effort to get there? Or do you feel like once somebody has one carrot, they're out there looking really hard for the second carrot? And that's where you, as a sales leader, have to pick your style. I'd rather them get that first carrot easy and be searching hard for the second carrot. That creates positivity, momentum, believability, great stories. It just creates, like, a winning locker room. The way that you define fair is dictated by you, how you answer that question. So don't forget we're talking about planning out quotas. Is it fair to plan that only the average rep will hit 70% of their quota? Is that fair? That sounds weird to me, right? Like, oh, my gosh, why would we plan for a rep to only hit 70%? Aren't we going to give them everything they need to hit their number? How will they hit their number if we can't plan to do it? I've seen most orgs are between 70, 70, and 80% on quota attainment for a rep, and that's what they plan on. That's usually dictated by are you a carrot person that wants them to go get the next carrot or you one that's like, want some work really hard? Gets the first one.

The example that I oftentimes give folks here is when my mom was teaching me how to swim, she would swim like one inch away from my fingertips so that I would just go a little bit farther, push myself a little bit harder because she was right there. But if she stood at the other end of the pool and was like, all right, get over here. I wouldn't even try. That's how you want to think about setting quotas. Personally, in my opinion. I know, Mark, you feel the same as well. That might mean that you have to have slightly lower otes and that might make your recruiting job a little bit harder. And I'm actually okay with that because ote will get an employee in the door. Attainment is what keeps an employee around. If someone feels like they're winning all the time, they might take and be okay with the fact that they have a 20k lower OTE if they're in accelerator land every single quarter and they feel like a winner. But people start to leave your company when they feel like they're losing every quarter. And the losing locker room is a super dangerous thing.

Yeah, there's the momentum of losing. Now, listen, why do we even plan at 70, 80%? I mean, if you're a new leader, maybe you haven't done this. You have to take into account like some of your reps are going to leave, some of your reps are going to go on pto, extended pto, sick leave, whatever, Right. You know, you're going to have rampers that you're going to hire in that don't have a full year's worth of quota and a full month's or full quarters worth of full quota. Right. So there's all of these little things that are kind of nicking away at the 100% attainment. And if you plan for 100% and you don't take into account these things that kind of chip away at it, you're never going to get there. I think it's reasonable to say that for a normal sales org, about 20 to 30% of the capacity of that org will be lost in people leaving, people on vacation, all of that sort of stuff. So it's reasonable to plan at 70 or 80%. Now, if you want to plan it 80, 90% reps are going to have a harder time getting there. You're going to have to have Higher incentives, bigger incentives to get there. If you plan at lower attainment, you can, as Armand said, have lower quotas, lower otes, things like that, that allow those reps to then really push forward into getting what they need to get out of the comp plan to be motivated to hit those numbers. So it took me a couple times, a couple cycles to realize all of the stuff that you have to take into account when you're planning out quota. And I was always like, I'm going to plan for my reps to hit 100%, because I'm going to give them the training and give them all this. And it's just not a realistic perspective to have.

So let's talk now about the other side of the equation, which is the financial reality. So we can want to get our team to 100% a quota, but the reality is, if the financials don't make sense, then you've got to increase quotas or you need to find a way to make your commission structure profitable for your business. So, Mark, just on the highest level, if I'm working with my finance leader or if I'm at least trying to be literate enough that I can, like, push back on finance when they're trying to jack up my quotas, what is the financial calculation that you need to be able to justify quotas?

It all starts with, like, your margins. Like, how much margins do you want? So you sell for X, you want a margin of Y. Let's call it 50%. So that means that you have, out of every $100, you can spend $100 to deliver that product for R and D, for your cost of acquisition and all that kind of stuff. So as the. You go through the financial plan, your CFO knows, oh, we're gonna. We're definitely locked into spending this much money on people. And now for this many deals, that's gonna take care of your $500. That's gonna take care of 150 bucks or 200 bucks. All right? The commission is gonna be another 50 bucks. The marketing expense to drive the pipeline is gonna be another 50 bucks. And so you start whittling it away, and what you end up finding is like, oh, my gosh, we aren't gonna meet our margins because we're paying some part of that equation too much. Maybe you have too many salespeople, and you need to raise quotas and have less salespeople. Maybe your commission plan is paying out too much at those different levels. And so that's where you start to have to do the Calculation of all right, what do we want our margin to be? Then we look at the costs associated with that. If you're planning out a sales org, you can't control many of those costs, but what the cost that you can control are your commission costs. And so you start to look at, okay, if we have this many reps that hit quota regularly, and these are accelerators, this is what our cost structure needs to look like to fit inside the constraints that the stuff that we're given and don't have control over. As an executive of the company, my job is to take care of the company first. And people always like, Mark, you got to take care of your employees worth. You know what happens if you don't take care of your company? You know what happens to your employees? They lose their jobs. So you got to take care of the company first, people. Mark, what about your customers? You got to take care of customers first. All right, we can get into semantics. Say your customers pay, you better take care of them. So you get all right, but you have to have a company centric view as an executive, which means you want to contribute to the profitable, efficient running of your company. And so the way that you do that is you look at what part of the margins that you're using and if it's too much, then you have to scale back.

One other way to think about this is try to put yourself in the seat of the CFO of a SaaS company. For example, when I was at Carta, the way that our CFO would explain to us that we need to justify quotas is as follows. Let's say that we sold a $10,000 deal. The thing is, if someone signed up for Carta, they were usually going to stay with us for at least three years. Our churn rate was really, really low for us. We were willing to say if we can have a 12 month payback on our cost to acquire a customer, then the next two years we're like printing profitably because we're just going to keep that customer. So what that means is if the customer lifetime value is a minimum of three years, that means we're going to get 30k over three years. If we sign a 10k customer, then we're willing to spend 10k in our first year as our customer acquisition cost. Now some of that needs to go to marketing, some of that needs to go to salespeople, commissions, et cetera. Some of that needs to go towards other things. But eventually we got to a customer acquisition cost number and we're like, okay, like that's how much we're willing to pay in commissions as a percentage of our customer acquisition costs. Folks, that is like the high level theoretical understanding of how to calculate this stuff. We're not going to get into a full financial modeling exercise here. Generally speaking, usually when I've seen early stage quotas, if you're assuming people are on a 50% OTE split, which is 50, 50 base to commission, then usually early stage companies commission percentages float around like 10 to 12%. Later stage companies like a Microsoft, it might be like 3 to 4% because the deals are bigger, the brand is trusted, etc. Is that directionally a good rule of thumb here?

That's what I've seen a lot of over years. A brand has invested and it's brand awareness, brand identity, and partly the reason that people are winning is because of the brand. Then the company shouldn't pay the reps as much because they're not doing as much work. Like if you're at a young startup and you're the one of the first two or three reps, nobody knows who you are, nobody believes in what you do, you have to be on point. That's a much harder deal to sign than if you're, you know, selling to banks at Microsoft and everybody knows Microsoft and you're just gonna get a bit meeting and you walk in and they're like, are we going to use Microsoft or Google?

Now that we know that we want to be around like 70% attainment, give or take. Let's talk about the difference between attainment and participation. What is a good percentage of reps to be hitting quota? If I have 10 reps, how many should hit quota?

I think seven to eight reps should hit 70 to 80% of their quota. So 70 to 80% of your reps should hit 70 to 80% of your quota. That's determined by your own personal style of stretching people to get to the first carrot or stretching them to get to the second carrot.

I want to give you an example of why it's important to look at both attainment and participation. So when I was at pave, one of the problems we had was as follows. Our first four reps were really amazing early stage sellers and they saw the product literally be coded before their eyes. And they were doing 100, 150, 200% plus. So our team attainment when we added four more reps overall blended was about 100%. The problem is our participation was below 50%. So four of our eight reps were hitting quota. But the other four were not. And so even though it looked like our team attainment was good, it was a hundred percent. The problem is only half of the reps were hitting quota. And what that meant is we weren't being consistent. In other words, it was hit miss, hit, miss, hit, miss. It was a feast or famine environment. And so if you have a really small percentage of your Epstein quota, but your attainment is really high, what that means is you have a few top performers who are skewing up the average, and you need to get better at ramping new hires into your environment. And maybe that means you need to invest more in training, onboarding, or maybe that means you need to not bloat your team until you get your existing performers better.

I would argue one of the most toxic things that you can put into a sales org is high attainment, low participation. Because what you have is everybody looking at a few people making all the money and saying they get the good leads, they got the good accounts, they get the executives on their call, and the next thing you know, it's an us versus them mentality. Instead of having four people do 200% and four people do 50% and it's feast or famine. Imagine if everybody's at 90%, everybody's in it together, everybody feels the same. There's some equality and stuff. And of course that's not always going to be the case because you have some talent that's better. Or there's the randomness of, oh, you know, Armand this month for some reason just got the three best leads and are randomized, round robin stuff that's going to happen. But you must look at both of these because not only does it create bad culture, but it's a signal when your attainment's high and your participation is low, that means that you have underperformers that either need to be coached up or coached out. I've seen a lot of younger sales awards that I've helped out with. They keep adding reps because they want to add revenue, but they could have just kept giving the reps. They had more and more accounts to get that more and more revenue and made them more and more successful until they were ready to hire more reps. And like, I would argue that especially in our efficient world that we're in now, you want a rep to cry for mercy. You want them to be like, I cannot take any more deals. I can't spend all the money I'm making. Nobody would say that. But you know, you know that you have to get Them to that point where it's just they're so busy that they can't take on anymore. That means you need to open up more capacity. If you try to open up more revenue by just creating more capacity, you are in for a problem because you probably don't have the pipe gen. You need to support that. But you know what, if you have 90% of reps hitting 90% of their number, you can create capacity. If you have, you know, a hundred attainment but 20% participation, guess what that means? Means you need to get rid of a bunch of underperforming reps and give more to your best reps until you're ready to hire more reps.

I've been through a couple of rounds of layoffs in tech and I know this is touchy stuff for people to talk about. In both rounds of layoffs that I saw, number of reps went down, overall revenue basically stayed the same or went slightly.

Yep.

And the reason for that is especially pre tech bubble popping, there were a lot of teams that were just saying more reps is the answer. And what ends up happening is your top performers calendars just get more and more and more and more empty. And your goal is to have your top performers getting the ball every single time. So let's talk about setting the actual quotas. So we know that directionally 70 to 80% attainment, 7 to 8 out of 10 reps, so 70 to 80% attainment, 70 to 80% participation. We want to be reasonably close when we're actually setting quotas. It's pretty straightforward folks. If you want to know how much revenue someone can bring in, the calculation is as follows. How much pipeline can that person generate? What are your win rates on that pipeline? And then what's your average deal size? So if the average person gets five inbounds, four SDR meetings and three self sourced meetings, you add that stuff up, you apply a deal size to it, you multiply it by a win rate and you have directionally a quota that you can give an individual and you can use historical data to find that stuff. So that's how you sort of get to the initial number using historical data. And we're going to put aside the if you're setting quotas for the first time as a founder, because that's a whole different beast of its own. Very rarely are you setting quotas in a static environment. It's not like people are like, oh, let's use historical data and let's make zero changes in the sales Org. How should your Quotas change. If someone's like, yeah, I want to set quotas knowing that this year we're also going to go from 6 to 10 reps. Maybe if we use those three buckets. Pipeline win rates and deal size. How does your calculation change for quotas?

If you look back, you have 10 reps and you calculate how much they did each and you know, divide that by 10, that would tell you what your quotas should have been. If you wanted to plan on 100% quota, that doesn't work. So like we talked about earlier, we got to plan for 70 to 80% in order to take into account all these things. But ultimately I think what you have to understand is any increase over the status quo must have a justifiable reasonable investment somewhere else to justify the increase. Let's say that I want to take my ticket response time for my support org from 20 minutes down to 15 minutes. Do I just put that on a slide, tell my support reps have at it stinkers and like let them run? No, that doesn't make any sense. But a lot of times that's what we do with AES. What will happen is sometimes like you know, your chief customer officer, somebody will say to the support people, well listen, the product is more mature now, so we shouldn't get as many tickets because we're not going to get as many tickets. You should have more chance to deal with them quicker. So that should bring our all of our response times down. That is a an assumption based horrible reasoning. That is logical, it makes sense, but it's probably not reality. What about the two new features you're about to release? That's not more mature. Those are brand new. Aren't those going to cause problems and people don't think about it holistically. I always look for when I'm getting my financial plan. I want to know what assumptions have been made at the conversion rate level When I'm looking at, oh, you know, here's the number of meetings set. This is the number of meetings hold. What's the meeting held rate? Wait a second, that just went up 10%. What are we doing differently there to make that go up 10%? Oh, our win rates going from 27% to 30%. Why? Like what, what investment are you giving me to do that? And if you get generic stuff like it's our brand is more mature, you know, we've been putting all this money into marketing so there's more awareness. You need to immediately stop. That's not a reason that you can go to reps and talk to them about why their quota has gone up. But if you're like, hey listen, we found our two major competitive gaps last year and we're releasing features in the second half of this year to support those. We believe that that investment will increase our win rates in the second half a year between three and four points. So we're going to average that out to a two point increase over the year. Okay, now we're working with something and they just have to be reasonable and you have to understand them. But like every increase requires an investment because they're not going to just go up on their own until you agree that that investment could result in that, then you can't set the quotas to whatever somebody just gives you.

That's right. So to recap, I'll give you two examples that Mark included there. So if we break them out separately into the sort of like we make this change, what happens in our equation? If someone says I want to go from 5 to 10 reps, what should my quotas be? Well, you need to start to go through the math. What happens to pipeline? Pipeline needs to literally double, double to support double the reps. Which means are you going to double inbound? Are you going to double up SDRs? Are you going to just double the amount of self source prospecting you expect AES to do? That's the first thing. Second thing is if you double your team size, what happens to win rates? Your win rates usually go down because new people don't win as much as your ramped reps. And so you need to look at new rep win rate versus old rep win rate and make sure that that's factored in. And then the last thing is you need to look at deal size. And this is probably where you see a little bit less deviation. But usually a new performer doesn't come in and start closing million dollar deals on day one. And so oftentimes a newer rep will still have a lower deal size than a more senior rep. And so that's what happens when you double in team size. If someone's launching a new product. Let's go through that same example. What happens when you're launching a. In theory there's a new buzz. Pipeline should go up. Great. Maybe that can support some of the quota increases. Win rates should go up, but the product is probably not super mature. So you can't just assume that all of that pipeline from the new product is going to have 33% win rates like every other product. And then your average deal size will also Change based on what that product's ACV is. So these are the types of variables that you can start to consider. Whenever someone is saying, hey, I think we should increase quotas due to X or Y. You can start to break it down into what actually happens to Pipel win rates and deal size. And what is the investment that I'm going to ask from my organization to justify this quota increase pipeline?

Win rates, deal size. Every action that your company takes, every investment that they make affects those three things. So when somebody changes a downstream thing like quota, then I need to know how are we affecting those upstream things like deal size and all that kind of stuff that would warrant that quota increase? I wasn't good at this. I was kind of a, okay, we're gonna go from a million to a million. Two quotas. Let's go. I'll figure it out. Like, come on. You know, I was always lucky. We almost always hit the number at outreach, but when we didn't, it was always because there was some blatant, obvious thing that we didn't consider when we were just like going for it because we said yes to everything. Because, like, you know, we're this great sales. Org. We'll figure it out. You do not want to get into that expectation mode. You don't want to get into the yes man or yes woman mode where you're just like, yes man, yes, I got you. Yes, sir. Whatever you want to do. Your role as an executive and as a revenue leader is to make sound business decisions that meet the needs of the company. If you are going to take that type of approach, then you need to always kind of say, well, every change is going to affect these three things. Do I believe that it'll affect them in a way that warrants this level of downstream quota increase? And if it doesn't, you need to demand it, or you need to get the quotas changed or lowered or whatever needs to happen. There's so many financial people that have lived their entire lives in spreadsheets. So for them everything is just, well, you know, it's not that much of an increase. And you know, the. There's this thing called the multiplicative effect, which is if I take five numbers and I multiply any one of those numbers by two, then the entire thing at the bottom is multiplied by two. So when I increase this by 10%, not that bad. I increase this by 5%, this one's going to go up 20%. When I add all those different points up, next thing I know I'm tripling what we've done in the past, it doesn't make. So you can't let spreadsheet people make those tiny little adjustments without justifying what that adjustment is there for.

For how often do you revisit quotas? And I know there's not a silver bullet for this, but this comes from the perspective of in a company to not be named. I once received 15 different compensation letters and I was furious. And I wish they just made one bigger increase once per year as opposed to 15 mini increases where I never knew where the target was going to be.

Yeah.

So in my experience, I typically like these to be revisited annually when we do the cutting of the territories, when we do all the headcount planning, all the capacity planning, and unless there is a massive attainment skew up or down, you don't change them. But Mark, I'm curious what you've seen.

The way that this works is finance and rev ops should be suggesting what quotas should be and the revenue leader should be understanding if those are attainable or not and providing feedback and justification of why they think what they think. If you have to change quotas more than once a year, that means that your OPS and your finance team are really bad at their jobs because you should be able to financially plan one year out on many different levels. One of those should be quota. So that's the first thing that I would start to see as a symptom of a problem is that your OPS team and your finance team don't know what they're doing on setting quotas or you're just saying yes to everything, like I used to do. If you have to change them multiple times a year, you need to do that, like as little as possible. I did a couple in year commission changes. I would say it usually takes three to four weeks for that dust to settle. And everybody is now like off on another tangent. They're thinking about different things. They're not focused on the job anymore. I would love to do a data study, Armand, that says how much did a quota change mid year disrupt a sales team and actually hurt production when they could have just left it the same and probably got better production? I guarantee it's the majority of time.

I get it. Sometimes attainment gets really, really high, other times it gets really, really low. If it gets drastically higher, drastically low, do something about it. But the little swings in attainment, 20% up, 20% down, you cannot do it both with your finance team. But then also you're going to hear your reps when there's a 20% swing talking about quotas. And the moment you start opening up this negotiation every single quarter, it's going to get people distracted and focusing on lobbying for quota changes instead of just focusing on how they actually get the number up.

You have to explain the mind of a salesperson to non salespeople. So what does a salesperson do when they get their comp plan with their quota? They immediately start dissecting it and looking for how do I get here and how do I maximize the amount of money I make? That's exactly what the comp plan is supposed to encourage. Right? So now a rep spends two, three weeks looking at their accounts figuring out how to make this work. This is how I plan it out. And then you change it in the middle of Q2. Guess what just happened? You just lost two or three weeks worth of planning and work and now rep is going to go do that again. There's no reason for that. Let's instead just do a good job setting them up front. And you know what? We might have to pay the price a little bit. We might have to do some other things. Maybe we don't do as many spiffs. Maybe we cut travel budgets a little bit. Like there's other ways to do things other than messing with the comp plan. The comp plan should be adjusted once at the beginning of the year at sko, blah blah blah. That's it.

When you adjust the comp plan, especially up, downward quota increases are easy to communicate. They don't happen that often. Upward quota increases. I've done this the right way, I've done it the wrong way. Talk to me about the right way to do it.

I believe that all quota increases should be communicated at the manager to rep level. You should not have a first meeting where your VP or CRO says, hey, we have a new comp plan and they walk it through with tons of people all at once. And then they have a Q and A session where they don't even answer the really good questions. And then, you know, everybody leaves feeling like super confused. You have to remember quota is as much about feeding the families of the reps that you have as it is your business goals. You are messing with people's money. That's why people have jobs. And the way to get somebody pissed off at your job is to mess with their money too much. Somebody's going to mess with my money. I want the person who's messing with it to talk to me about what's going on. Every situation should be at least A manager, if not an executive, talking to the rep and just realize they're always going to have a negative energy about it. It's always going to be nitpicking and trying to figure out and trying to justify why there shouldn't be a change. Your job isn't to overcome all that. It's to help them understand why it's better for them and the company to do things that way and then to show them the investments that make that possible.

There are multiple layers of management that you need to communicate the comp increase. So for example, if you're a VP of sales, you've got to teach your managers the why first. And you've got to make sure that they can get all their questions out so that they go communicate the why to their reps. Because if you don't, the managers are going to be like, hey man, I know this sucks. You just got to deal with it. You want them selling the why. So if you have two layers of management, you've got to sell each layer on the why. At Pave, I did communicate it in a group environment, but that's because I had a team of eight and we could literally like share a pizza together. And they trusted me a lot. And it is the only time where we actually had the team applaud and be fired up when they got quota increases. The biggest reason they were fired up is we had a decision to make as a business. We had to go from 6 million to 20 million in a year. We could either do that by tripling the number of reps on our team, or hiring maybe five to six more reps and making sure that everyone carries a little bit more of a load. And for that reason, here's what that means in terms of what everyone needs to step up to do a little bit more so that we can keep a lean elite team instead of having a bloated. More heads equals more revenue team.

Great.

Fewer reps, bigger territories, I still have the ability to over attain. Here's what you guys are doing in terms of investment in product and pipeline, in marketing, demand generation, all that stuff. We literally walk them through the calculation and the assumptions of what it takes to get the quota. And the team was like, I get it. You start to realize that they would rather pick the reality of having fewer reps with bigger territories and slightly bigger quotas than a bloated team. To whatever extent possible, if you were bought in on the why with your finance team, you need to explain to your sales team why you were bought in the why and why you also believe this is the right decision.

You have to always remember that thing. I think that it's. It takes four times as many compliments to overcome an insult. And when you are raising quotas, that's an insult. And so you need to have positive things to balance that out with. And if you don't, or if you go through your comp plan and quotas going up, territory size is going down, you know, we're not going to hire as many SDRs next year. All of a sudden it just starts mounting and mounting and mounting. And it seems impossible when you're like, hey, quotas are going to go up a little bit. But you know what? We were going to hire a lot of reps. Now we're not. And you know what? Look, we did a little bit on the acceleration side because we need you guys to carry a bigger bird. And once you get there, we want to reward you more. Now you start to give that give and get. And that's what all reps are looking for, is they don't want to feel taken advantage of. They don't want to feel like they're just a number. They want to feel like it's been thoughtfully considered what they're being asked to do. We've talked about a lot of times comp plans have to be super simple. But you do need to make sure that there's a balance there with components if you're going to raise a quota.

Alrighty, folks, so let's recap. We talked about what is fair quota attainment. No losing locker rooms. 70% attainment. 70% participation. All right, no feast or famine either. Number two, we talked about how to forecast quota attainment so you can look at how much pipeline your team is generating per rep, what are win rates, and make sure those aren't deviating a ton between the top of the bottom. And then what's your average deal size? And then depending on if you want to add reps, add products, that's going to have an impact on pipeline, per rep, win rates, etc. Deal size. And then the final piece is, we talked about communication. If at all possible, try to evaluate these quotas once per year in your planning with your revops team and your finance team, unless they're egregious changes or egregious skews in attainment. And then when you are communicating the comms, do not make it. This black box of take your quota. I know it's unfair, but go figure it out. Try to be as transparent as you can be. On the why behind quotas are going up. Alrighty folks. Hopefully you like this one. If you liked this episode or if you have other ideas for our next Leadership Playbook, there's a little box in Spotify that says like hey like. There'll be a prompt of like hey, comment on this episode. Let us know what you would like to see in the next Leadership Playbook episode and we will catch you on the next one. Peace.