ChickenWings

Tom Callahan's Son

Commish Rate on OTE

I've gone down a rabbit hole on understanding my pay plan.

It's encouraging to find that it's actually pretty good.

Paid out monthly on YTD attainment on annual goal. Consistent MRR from a managed book of accounts. Reasonable growth targets if you can bring in 1-2 good net new logos per quarter.

This exercise was mainly to understand how seasonality, time to revenue, etc could cause "feast or famine" months throughout the year and defend against "quicksand".

Lessons learned

Choose your accounts wisely...will they perform to your forecast?
Forecast strategically so you end up committing to an attainable annual target
Make sure your set OTE yields a fair commission rate to that target

A key metric I ended with was finding out my commission rate to quota/OTE fails around 5%.

How does that compare to other ENT/MM commission rates?

💰 Compensation

💴 Money Management

15 comments

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braintank

Politicker

Enterprise Account Executive

Mine is:
0% - 100% = 11.61%
> 100% - 150% = 14.51%
> 150% = 17.41%

Blue_Turtle

Opinionated

sdr

Nice numbers, what do you sell?

braintank

Politicker

Enterprise Account Executive

Enterprise security SaaS

CuriousFox

WR Officer

🦊

Mine is too lengthy to fully understand but it's been pretty bomb during my tenure.

TennisandSales

Politicker

Head Of Sales

i love it when folks take the time to REALLY understand how they make money. good for you. SO many ppl dont do the work and just have no real plan.

ChickenWings

Opinionated

Tom Callahan's Son

Much appreciated.

In every role I’ve had, it took creating micro goals to become “good to great”.

I couldn’t do that very well until I understood the pay plan haha

GreenSide

Politicker

Sales manager

I have an AE who refuses to learn. Claims he can’t figure it out so just doesn’t then asks me if he should get a specific bonus and how much. Initially I tried to help him but now it’s on you, bud.

ChickenWings

Opinionated

Tom Callahan's Son

Learning to navigate an org for these things is crucial.

I have been lucky to have leadership that put focus in pointing me to at least the first step…but it was on me to ask the right questions, find the next right person, then share my findings with the rest of the team.

I definitely spun my wheels at first, but in time I built my tribal knowledge.

Pachacuti

Politicker

They call me Daddy, Sales Daddy

Commissions are all over the place. Every company, every product, every industry = different commission plans. Also, typically the higher the base, the lower the commission and vice versa.

I carry a large quota and can be paid anywhere from 1% to 5% for a deal. And there are some outliers and exceptions too as well as accelerators.

An apples to apples comparison is basically impossible.

ChickenWings

Opinionated

Tom Callahan's Son

Helpful.

In a vacuum, I’d say I’m pretty happy with my setup.

Apples to apples may be tough, but there are common levers pulled in pay plans.

Canvassing the market to see which ones relate helps me know which ones to try pulling myself.

LordOfWar

Tycoon

Blow it up

Best answer. Industries and margins are so varied that unless you're comparing similar companies it is hard to gauge properly.

My quota is always changing but my plans OTE is based around a quota of $7m, about 75% of which was recurring rev when I joined. Under my plan, I make very little on everything going up to about $7m and 2% for everything over it.

My biggest peeve is that since I'm paid on shipments, stuff rolls from one year to another if there are delays. What can be a nice earning at the tail end of one year can be pushed and is then paid at the lowest rate. It does end up building next year's ramp and acts like a non-voluntary tax deferral so it is not all bad.

Hoping to hit $18m in deliverables this year. We're in manufacturing.

Diablo

Politicker

Sr. AE

10-75% - 7%
75-100% - 10%
100+% - 12%

Sunbunny31

Politicker

Sr Sales Executive 🐰

Mine's pretty simple:

0-100% - 12%
100% + - 14%

plus bonuses for multi year deals of 3%.

Blue_Turtle

Opinionated

sdr

Simple seems better. Ours (from what I’ve seen, it’s supposed to change and I’m interviewing for the closing role) is variable. I’d much rather have set value like this. What do you sell?

ChickenWings

Opinionated

Tom Callahan's Son

WELL…5% isn’t that impressive comparatively.

what annual quota are we working with here?

I’m a hair over $2M

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ChickenWings

Commish Rate on OTE

15 comments

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