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OTE - if you get a raise, should that stay the same or increase?

Company seems fixated on keeping the OTE at $150k regardless of base pay / other factors. If a rep get a pay raise, the commission payouts seem to reflect lower % so that the OTE sticks around $150.


Rep A: Base $50k, commission payouts 10%, 20%, 30%


Rep B: Base $70k, commission payouts 5%, 15%, 25%


Example:

if Rep A sells a deal at 10k, they make $1,000

If Rep B sells the exact same deal at 10k, they make $500


This isn't proper form right? Seems so off to me.

πŸ’° Compensation
8
jefe
Politicker
+8
Sales Director
That doesn't make any sense to me.Β 

Why would a company decrease the variable comp to their salespeople? And how would it help them to increase the base but keep target comp the same, essentially disincentivizing them....

If they want to bump the base pay of sales reps, then that should reflect an increase in overall comp.Β 
Ir
IrishHoosier
Good Citizen
Sr. Enterprise Account Executive
The fact that they cap commissions is a red flag to begin with. You closing more business is mutually beneficial, there's no reason you shouldn't be incentivized to blow it out of the water. I'd get out of there asap
RandomPaperclip
Valued Contributor
+4
Sr. AE
so, it is "uncapped" but the OTE is staying the same. That is the issue. You can absolutely go over it, but if my base increases, my % payout goes down to reflect the OTE.. it's wild
Sa
SalesHammer21
Development Partner
Keeping OTE the same after increasing base pay is demotivating. Seek out a company that will incentivize you. Money talks. Stay hungry!
salesnerd
WR Officer
+16
Head of Growth
This is wrong. Generally when base salary increases, quota increases. When quota increases your commission rate either goes down (your example) or stays the same. If it stays the same, your OTE will further increase.Β 
RandomPaperclip
Valued Contributor
+4
Sr. AE
Agree. And 2 folks just got promoted and kept the same base, but got higher earning potentials. It's all over the place... it honestly hurts to think about.Β 
CadenceCombat
Tycoon
+13
Account Executive
Wtf. So weird.
joeygal
Good Citizen
Sr. AE
In my opinion, that makes no sense at all. Most salespeople go into this field because we love money and what it can afford us. We are driven by the sheer and simple fact that we control our destiny. Being capped can directly correlate with the output (or lack thereof) from that rep. Incentivize small, win small. It's easy math, at least for me.Β 
SalesPharaoh
Politicker
+8
AM BDR
This is very weird system like it makes me want to be Rep B to get that guaranteed money.
WhereverYouGoThereYouAre
Fire Starter
+1
VP, Sales
OTE increases...otherwise it isn't really a raise if you're a salesperson. Salespeople do the job they do for the upside. We LIVE for upside. Otherwise we would all work in FP&A.
WineTime
AE Sales Manager
bizarre, definitely not
NorthernSalesGuru
Politicker
+5
Account Executive
This just seems absurd.

I’ve never heard of something of this nature, and I’d really dig into the company background if this was the case.

I can appreciate if the variable component stays the same despite base pay increasing or decreasing, but never have I heard this sort of trade off.
sahil
Notable Contributor
+15
Deepak Chopra of Sales
This is stupid, unless the company has hit an inflection point. Over time, mature orgs seek to lower the cost of sale. What's the time period that's elapsed?
RandomPaperclip
Valued Contributor
+4
Sr. AE
@sahilΒ comp plans have changed 3x in 5 months. We're about 1 year into "major growth mode"Β  Β far from "mature"Β 
Chep
WR Officer
+10
Business Development Team Lead
That is B.S. Like I understand if everyone hits quota I guess it's nice in theory everyone makes 150, but just doesn't seem right you get promoted, but if you do your job right then you still make exact same amount
De
Deepfuckingrevenue
Praised Answer
Enterprise AE
Facts- Any sales rep who wants a bump in base salary is a terrible sales rep. Every year I negotiate higher upside potential and make more when I beat targets. Asking for a little base bump shows sales leadership you aren’t hungry and they are giving you more for nothingΒ 
RandomPaperclip
Valued Contributor
+4
Sr. AE
@DeepfuckingrevenueΒ so you're not a fan of base pay increases? That's your guaranteed money vs. a variable that can change, fluctuate and sometimes be out of your control.Β 
De
Deepfuckingrevenue
Praised Answer
Enterprise AE
@RandomPaperclipΒ  not at all. What are you getting? Β 5 or 10k raise? And that’s beyond generous. Give me the opportunity to earn more if I can sell, I can make 5-10k on a single deal and then pile ontop of that. If you are good at sales, you want more upside because things out of your control rarely happen.Β 
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