Guide

Compensation Plan Alignment: Motivate the Right Behaviours

Sales compensation drives behaviour. Misaligned comp incentivises the wrong things. Align comp with strategy. Get results.

Compensation Components

Base salary: 40-50% of target comp. Attracts reps. Protects against churn.

Commission (revenue): 50-60% of target comp. Tied to closed deals. Primary driver.

Quota types: Revenue quota (primary) + activity quota (calls, meetings). Balance both.

SPIFs (special incentives): Time-limited bonuses for specific behaviours: new logos, expansion, territory growth.

Alignment Examples

Fast sales cycleCommission for early deal movement. Bonus for deal close dates.

Deal qualityCommission reduces if deal is returned. Penalize low-quality deals.

Expansion focusHigher commission on expansion deals. SPIF for upsell/cross-sell.

Renewal successShared commission between sales and CS. Both rewarded for renewal.

Design aligned compensation

Work with a consultant to align sales comp with your RevOps strategy.

Comp Plan Review

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