How attainable should OTE be

Hi All - is there guidance / historical data / any rule of thumb around how attainable OTE should be?


At my prior company (late-stage private fintech company) OTE was considered what you should be able to earn if you execute as expected ("on target") and is achievable. Yes, the quota that determined whether or not the variable part of the OTE was met was increased year over year and some sales folks were frustrated by the quota increases but there was enough out there to hit quota and hence achieve 100% of OTE.


At my current company (series B, ~85 people, climate-tech company) some folks in leadership feel OTE should only be hit 50% of the time. This leads leadership to setting, IMO, unrealistic quotas which the sales reps (3 AEs) are not set up to hit / succeed. I was surprised to hear the 50% number and hence thought I'd reach out to see if anyone had any guidance or thoughts.


Thanks in advance as always - all y'alls contributions are always helpful and appreciated ๐Ÿ™

๐Ÿ’ฐ Compensation
10
TennisandSales
Politicker
4
Head Of Sales
I'm sure there is someone who has compiled the stats of what is most common but there is for sure NOT a STANDARD way of thinking about it.

you have experienced the 2 main points of view though:

1. quota should be attainable, OTE should be attainable and if the team is not hitting OTE then something went wrong.

or

2. OTE is a dream and if you hit it then you CRUSHED it and should not be expected.

Although companies that take on #2 also seem to be the ones firing you if you miss quota.

what guidance are you looking for here exactly?
antiASKHOLE
Tycoon
2
Bravado's Resident Asshole
funny how number 2 is..
10Xsales
Valued Contributor
1
Enterprise Sales
The exact guidance I'm looking for here is

(1) opinions of where company leadership stands on this issue; essentially whether they support 1 or 2 in your post above. Maybe I should have done a poll?

(2) Whether there was any framework / guidance / rule of thumb of what % of the time OTE should be hit. Or what % of reps should be hitting their OTE.
coletrain
Politicker
4
Account Executive
OTE being achievable maintains higher satisfaction and also allows for an implicit "should we hire more people" barometer.

80-85% of reps hitting is a much better metric because that shows who is willing to put in the work required.

It seems the standard is churning through lowest performers with unrealistic OTEs because of replacability.
Sunbunny31
Politicker
3
Sr Sales Executive ๐Ÿฐ
80-85% is realistic, and what I was told execs were expecting. In that group are also the ones who overachieved.

15-20% missing could be a fluke - bad year for a rep; missed deal, etc., but should be viewed as a problem only if it's a persistent miss.
punishedlad
Tycoon
3
Business Development Team Lead
"On target" means: on target. That's an absolutely shitty way of thinking on leadership's part, and they're setting themselves up for failure by creating false expectations for new hires and stretching their existing sales crew too far.

Is there any hope of these circumstances changing?
Sunbunny31
Politicker
4
Sr Sales Executive ๐Ÿฐ
Was going to say exactly the same thing. OTE is literally "on target earnings" not "only if you crush it earnings" or "dream on earnings".

I'm not sure why this is so hard for some leadership to grasp.
Justatitle
Big Shot
2
Account Executive
Companies are rather funny. We want you to hit this quota but we only want 50% of you to do it and the rest we will hand plans and pips to in order to set an exampleโ€ฆ
FoodForSales
Politicker
1
AE
I like that question. It should be attainable, but with effort.
Sunbunny31
Politicker
0
Sr Sales Executive ๐Ÿฐ
No effort sales is order taking. And anyone can do that.
BlueJays2591
Politicker
1
Federal Business Dev Director
50-60%. I think this is a good number
ChumpChange
Politicker
1
Channel Manager
I would say somewhere between 60-70% quota attainment. Anything less than that tells me Finance doesn't want to pay folks and is fine with the turnover which sucks.
TheQueenofDiamonds
Politicker
1
Account Executive
Plugging in repvue, check it out! Will give the visibility for your next job to make sure ote is attainable by majority of the sales team
62
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