In many organizations, sales quota attainment is the foundation of seller performance management – meaning it’s the primary factor to evaluate how sellers are doing. According to a 2017 Gartner research study involving 92 sales leaders, 82.6% reported using quota attainment to measure performance.
Quota attainment determines, among other things, incentive trip qualification and performance plan triggers, plus generally illustrates the health of the sales organization. However, most sales operations leaders do not fully leverage the true potential of this metric. Quota attainment should also be used to assess the effectiveness of quota allocation decisions and effectiveness.
A question commonly asked by sales executives is “How many sellers made their quota last year?” Undoubtedly, this is a popular answer that every sales manager, head of sales operations or sales compensation practitioner should know. However, knowing that 58% of the sellers made their quota (as an example) isn’t enough. It is also important to know about the shape and dispersion of the quota attainment distribution curve.
Despite being a heavily used metric, sales quota attainment still has the potential to reveal hidden gems of insight. It is an area where a picture can convey much more than words or numbers in a table.
Illustrations and Insights of Visualized Quota Attainments
Before engaging in any analysis, consider what good looks like. Thoughtfully creating a model distribution will serve well in comparing the results of different sales teams that vary in size, focus and other key demographics. The insights revealed can have a dramatic impact on organizational finances and sales morale.
Model Distribution of Sales Quota Attainments
Ultimately, these analyses will lead to quota allocation improvements and even cost of sales reductions. Even if you aren’t looking to reduce spend, commission dollars should be spent effectively to attract, retain and motivate a high-performing sales team. Additionally, a culture of objective performance management and continuous improvement leads to ongoing, sustainable success. These are worthy goals and aspirations. To get there, continually explore to find the root causes of problems. Sales quota attainments are a great place to start.
As a final note, I wish everyone celebrating a very Happy Thanksgiving during these chaotic times. Stay safe.