In putting together a pay structure for a sales team, the first step is to establish the right total cash compensation for the role. The next step is to decide how much goes into the base pay (/salary), and how much into the variable incentive pay at target. The main determinants of pay mix are market practice and sales role prominence.
How do we ensure our sales comp plans help us retain top performers and help us weed out the under-performers?
Let the plans do what they do best and pull your solid folks along to higher levels of contribution, and use your performance management process to send a clear message to the underperformers.
Our CFO feels we should give out quotas that add to 20% more than our annual plan. Is that a good idea?
Distributing more quota then the annual operating plan is called over allocation. A little bit is okay and a lot is not.