7 Tips for Hitting Your Number Webinar

Mid-year is a great time to roll out comp plan changes! We split these 7 sales comp tactics into two sections, tactics and cultural elements, to help your team hit their number:
Comp Plan Tactics
1. Reset quotas
2. Set multiple tiers
3. Switch to monthly quotas
4. Build the right sales habits

Culture & Quotas
5. Don’t set accelerators that are too rich
6. Turn off the leaderboard
7. Encourage meditation

Key Takeaways
-Don’t be afraid to overpay (a little)
-Your team wants to hit their targets!
-Don’t forget the science: commission smarter feedback loop

7 Tips for Hitting Your Number Transcript
Sanj Sanampudi (3:32):
Hi everyone. I’m, Sanj, co-founder and CEO here at Concert. Before starting Concert, I was a former CFO and head of finance and managed sales comp. Everyone’s favorite topic! At Concert, we automate the calculation of sales comp, but one of the things that we do that’s a little bit different is we actually help you create better comp plans through an understanding of the neuroscience and psychology behind comp. And we’re going to give you some of those tidbits today.

Sanj (4:25):
And the goal is that these things are actually tactical, usable. You can start implementing them now, and we hopefully will share some of the science around why they work and how you can drive better performance. So today we’re going to go through the first part of what we talk about is our Commission Smarter Feedback Loop. So how do targets, comp training- how do they all fit together to influence your performance? Then we’re going to go into our seven tips. We have them broken out into two sections. One will be really around the tactics; what are specific elements you can put into your comp plan today to get them to perform better? The second is going to be around the culture you’re creating in how you’re managing quotas and performance. And then finally, we’ll share some tips on how you can move forward. 

Sanj (5:47):
So starting into the Commission Smarter Feedback Loop, if any of you have joined Concert topics before, this is really the science of how comp plans impact performance. And we’ve got some polling results right now.

Rich Sgro:
There’s a lot of confident people here.

Sanj:
Yeah. That’s great!

Rich:
Congratulations for the 45% of you. (referring to a poll asking: How confident are you in hitting your 2021 revenue goals?)

Sanj:
Yeah. So for the 45% of you, we’ll give you a few tips on how you can become more confident. For the other 54 or 55% of you, we will hopefully make you a little bit more confident. 

Sanj (6:27):
So how does comp really work? How do targets work? How does your playbook work? How do commissions influence performance? So the science of this is, they actually activate reward-based learning feedback loops in your brain. And the way a reward-based learning feedback loop works is first you have a target, it tells someone where you’re supposed to go. What are you aiming for? The second element is the playbook or the behavior that you’re looking for.

So I want to go to $100,000 by the end of the quota. How do I get there? Do I actually know what I need to do to get to that number? And the final is the commission or the reward. And that piece is what solidifies that learning. So it reinforces the behavior so that starts to become a habit. And you start getting to your targets more regularly. This is really foundational in how we’re going to talk about the tactics. So I’ll pause here and see if there are any questions. 

Rich (7:38):
First question: the target, the quota, the plan and the goals… What would you say the differences would be in those things?

Sanj:
A target quota and a plan and a goal are often used synonymously. So totally understand the confusion there. When we say the quota, this is really like what does an individual rep think that they’re supposed to hit to make their OTE? That can be disconnected from your sales plan, which is fine. It can be different from the individual targets that you set for them, but really this is the number that someone thinks about as success.

Sanj (8:34):
So we’re diving into the seven tips for hitting quota. So we’re splitting them up again into tactics and cultural elements. So on the tactic side hitting midyear, if you are at midyear, or if you’ve started a new fiscal year, this is really the time to reset your quotas, reset how you’re thinking about them, incorporate all the learning that you have from the market. And it’s a totally reasonable time to do that. The second tactic is to set multiple tiers. We see a lot of plans where people are putting in zero-to-quota gets paid X rate, and then over-quota gets paid a higher rate. You can actually put a little bit more granularity into that, and we’ll talk about why that makes sense.

Tactic three, switching to monthly quotas. But there are a lot of reasons and a lot of data that we’ve seen why that’s effective. The fourth is thinking back to that feedback loop around building habits. So if you think about your comp program as helping your sales team build a habit, what are the habits you’re really trying to build?
On the culture side, overall, all the research that you will see around how people do their best work suggests that compassion is more valuable to people’s performance than any form of competition. So with that, everything you’re going to see here is, don’t over reward these top performers, don’t create these artificial competitions in the organization. And in fact, encourage those self-care moments. And again, more research behind this, anyone who knows me pre-Concert would know that I would have been the one against all these things. But there is actually a reason why they work and we’ve seen through data that it actually increases performance.

Sanj (10:52):
So let’s dive into the tactics. Rich, do you remember what the most common marathon finish time is?

Rich:
Three hours, 59 minutes.

Sanj:
Very good. So if you guys haven’t seen this stat before, the most common marathon finished time is 3:59, which is shocking and makes me feel very bad about my athletic performance. However, what’s more impressive than that is the fact that the graph is so multimodal. As you reach these milestone times, you see peaks and troughs right around the milestone. And that gives you insight into one key characteristic of every human that you’re working with, which is that we’re driven to achieve targets. So when we go into recommendation one of resetting your quotas, what we’re really talking about is leaving the past in the past. So if you can, this is a great time to just say, whatever you overachieved or underachieved in the first half of the year, let it go. You’re starting new. It really shows up in this graph at this point at four hours, and one minute. The difference between 3:59 and 4:01 is a 40% drop-off in performance.

So basically if you’re not going to hit your target, you just stop trying. So in order to really activate this, think about what your targets really are. They need to be relevant and controllable. You can’t control what’s already happened. And for the relevance piece, we really see this on CS teams who might have annual targets, where they’re maybe comped on a retention rate for the full year. The people that have renewed have either renewed or terminated already. What do you want someone to do with the very next customer who’s supposed to renew? You want them to still go for the renewal regardless of where they are on their retention rate. That’s how you increase the relevance of the targets you’re setting.

Rich:
Sanj, this idea of resetting quotas, is this something that is different depending on maybe the sales cycle of an organization? Or is this something where half-year is always just a good time to take a look at the quotas and say, “Now’s the time.”

Sanj:
Half-year is usually a good time, mainly because you have six months of data to see how people are working through their pipeline. What’s working? What’s not out of the initiatives that you plan for? Are you generating the number of leads that you thought you would be able to generate from the investments you made at the top of the funnel? So it’s an artificial time, but about six months in usually gives you enough data to know if it’s the right move or not.

Rich:
Makes sense. One live question coming in here, Sanj, about renewals versus retention. Can you dive into the specifics of what that would actually look like? The question is just on renewals versus retention. What does the comp plan look like? What would we be paying out on? Would it be dollars renewed? Would there be a cliff? Would every dollar count? Just talk us through maybe one level deeper on that.

Sanj:
Yeah. So if you’re really trying to focus people on what’s relevant and controllable. Every single renewal that they have an opportunity to execute on, is relevant and controllable. So our recommendation is you pay people on every single dollar booked and you calibrate it against their base target. If you want to be extra generous, so say, Rich, has a million dollar book of business, maybe over $750,000 in renewals, he can get a higher rate. And what you can also add to that is the idea that accounts might be reassigned. So an added bonus that you get from paying on renewal dollars is that people are eager to take on more accounts. So you increase your service efficiency as well.

Sanj (15:36):
Moving on to tip two. So tip two: Set multiple tiers. Again, we see plans all the time that are ‘up to quota you get paid this rate’, ‘over quota you get paid this higher rate’. So the way that this ties back to the graph before it is not everyone is made to run a four-hour marathon. I mean, I certainly wasn’t. So when I ran, my embarrassing marathon finish time was five hours and 28 minutes. It’s because this lady was running in front of me with a 5:30 sign. And for 26.2 miles, I just kept her in my sights. And I was, “I’m not losing to her. I can definitely do this.” And when you get to the last two miles, you’re just like, “Okay, I know I have what I need in the tank. I can do this.”

And I beat her by two minutes. So I guess it worked. It was still not a very good time, but the point of the multiples tiers is that one four-hour number isn’t enough to bring out the best performance in everyone on your team. By setting multiple tiers, what you’re able to do is get your high, medium, and low performers each to have their own target that they find more relevant.

Rich:
That’s interesting too because I’ve seen this before where maybe you get paid 10% on the deals up until quota. And then after that, you start to accelerate. But you’re saying there’s actually some benefit here of having maybe lower tiers. How would that work?

Sanj:
So you might have lower tiers that have a decelerator to them. So you might say, up to 50% of quota, you’re actually paid 8% and then you’re paid 9% from 50 to 100 and then you’re paid 10% over 100. The calibration of those tiers is just math.

That’s actually the easy routine part of getting this done. The principle around how you’re setting these targets so that every person is able to look at a target and say, “Okay, that’s the one for me.” And that every person is able to look at their pipeline based on their target and act differently. That’s when you’re really kind of hitting a magical spot with these.

I was just going to say there’s another cool thing about this from our data… Say you get to tier two this quarter, people who are at tier two are much more likely to get to tier three. So it builds a natural progression of performance for your team.

Rich:
Interesting. It’s almost like you can think of these as your tronches, if you wanted to run a 3:30 marathon, you probably wouldn’t start shooting at 3:30. It probably would be 5:15, and then five and then four and change.

Sanj:
You chip away at that goal. And it’s much less daunting than just being thrown into it.

Rich:
As usual with these things, the psychology of it really resonates in normal stuff that we humans generally understand.

Sanj (19:08):
So we’re going to do a psychology experiment to understand how a temporal distance impacts our perception. So imagine a vacation you want to take six months from now, Rich, I’m putting you on the spot. What do you want to do six months from now?

Rich:
I want to be somewhere tropical and with a tropical drink in hand.

Sanj:
All right. So zoom it in. If you’re taking a vacation two weeks from now, what do you want that to be like?

Rich:
I definitely want to know a little bit more about where I’m going, when I get there. What the stuff I’m going to do when I arrive at the destination is going to be… How I’m getting back and forth to the airport… What the weather’s like…

Sanj:
So you’re thinking about tactics. People start thinking about what they’re going to pack. They think about where they want to eat, what spa appointments they need to book. They zoomed down from this feeling to this actual action that they need to take. And that’s the same thing with monthly versus annual quotas. With shorter time horizons, you translate goals to action. And we’ve seen this in our data when people are moving from annual or quarterly targets to monthly targets, believe it or not, we actually convince people to do this. But you see more active pipeline management. So instead of seeing everything parked with a September 30th close date, you start seeing things are going to close August 15th.

We can close things August 15th? Who knew that? You see people close fewer months with zero, especially if you have a team that’s used to a longer sales cycle, it’s probably not a big deal for someone to close a month with zero. You see the less concentration of the closed dollars in the last period of the month. I’m not saying this is going to bring you to one-third, one-third, one-third, but instead of 80% of your business being closed in the last month, maybe you’ll move to 50% closed in the last month. And then finally, you see higher overall performance. So we’ve seen from some of our customers, 10 to 15% increases by this change.

Rich:
So Sanj, I want you to unpack that a little bit more. Quicker sales cycles, this makes a ton of sense. But if you put a longer sales cycle, let’s call it four months or above five months or above something like that. How does this work, practically speaking?

Sanj:
Yeah. So for the longer size sales cycles, probably the biggest thing that this does is it helps people to stop thinking through the quarter-end madness. I think there’s a natural inclination to work with the prospect and say, “Let’s get this done by June 30th.” And when you’re on monthly quotas, then suddenly it doesn’t matter. If you have a few big deals, you’re just going to try to make sure they all close around the same time, but you’re no longer confined to thinking this needs to close by June 30th. You might actually say this needs to close by May 31st. The other thing that you’ll see, and I think this, again, we have a handful of customers who’ve taken this suggestion on that we’ve seen the performance of. But I think there are things that you can see around discounting as well. I think it’s pretty well known that near quarter-end, you’re going to be able to work your way into a discount, if suddenly you’re closing this off that cycle, that discounting incentive guts way.

Rich:
It’s interesting, too. And it probably puts you in the mindset a little bit more of when your customers going to be ready to do it. It’s not, what do I got to do to get you into this SAS platform today? It’s, “Okay. Sanj, you’re ready to buy?” I’ve got other stuff I can focus on for June close or July close or whatever it is.

Sanj (23:35):
So step four: Building the right sales habits. So we’re back to the Commission Smarter Feedback Loop, where we’re thinking about our quotas, the behaviors of how we’re going to get to quota and the reward that can build that into a habit. So what we’re really looking for when we’re talking about building sales habits is, how do we successfully execute this feedback loop as many times as possible? Because the more you give a reward for the right behavior, the more you’re building a habit. 

Rich:
It’s funny, you talk to sellers and you talk to sales leaders about this concept, and sometimes they kind of handwave at it, but this is tactical actionable goodness right here.

Sanj:
Yeah. I think from really a finance or an Ops lens, you naturally think about the pipeline this way. You’re thinking about it as a factory and supply chain and you work backward. So to get to 100 closed one opportunities, I might actually need to start with 110 MQLs and 107 outbound ops generated. So, most reps at the individual level don’t really think about hitting quota this way. And what we propose, and we call this a blueprint to quota, how are you going to hit your target? So if you have a quota that goes from September to November and you need to close 20 ops in that time, let’s choose ops instead of dollars for simplicity. Then what you might notice is that your work actually starts in August and you actually need to do outbound from August to October to have a chance of getting here. So are you taking the right steps, the right time to hit your quota? And the way it ties back to comp is you actually pay for these intermediate steps and these intermediate milestones because you’re really trying to build a habit around that.

Rich:
I think you can see this too organizationally, and I think we’ve all been a part of this in the past where maybe you’re bringing in a big deal. It’s a standard deviation or two above whatever else you got going on. You look at that and you go, “Okay, cool. I’m only going to focus on that.” And then you forget all of these other things and you don’t really have a good quarter the next quarter or a good month the next month.

Sanj (26:39):
So now we’re moving out of the tactics and now we’re thinking about your team as people. And the first thing that we often see, and if anyone approaches me with this comp plan, it’s the first thing I try to work with them to pull out: accelerator rates that are too rich. This to me, just sticks out in every person who has it as just a total lack of strategy. “Okay. You know what, if someone beats quota or someone gets to 2x of quota, let’s just pay them 45%.”

And it’s like, “Okay, cool. How are you supposed to get there?” What that rich accelerator rate really shows is it’s like a lottery ticket. It’s really disconnected from anything you can actually do as a rep. We recommend that you limit your accelerators to 2x base. There are cases where you can go a little bit higher than that. But really, high accelerators lack the target that really motivates someone because 2x quota for most people is not motivating. It’s actually an impossibility. And it doesn’t give them the right behavior. So what is it that I’m supposed to do to get to 200% of quota? The last point on this is that excessive rewards increase your willingness to take on risk. So if you look in the back, there’s a picture of a lottery ticket. Rich, do you ever play the lottery?

Rich:
I’ve played before. Yes.

Sanj:
When do you play?

Rich:
Usually when the jackpot’s gigantic.

Sanj:
Right. My number is $300 million. If the jackpots over $300 million, I will buy three tickets, one will have the Lost numbers and then the rest will be random. I’m not a risk-taking person, necessarily. I can take calculated risks, but I’m a finance person, I don’t do that stuff. But a really high reward changes your risk tolerance. It changes your psychological calculation on whether the risk is worth taking. Anecdotally in our data, we’ve seen that this seems to result in lower quality deals. So the deals that get you to that accelerator and happen after that accelerator tend to be higher risk than the deals that you did in ordinary business.

We also see this, to a lesser extent, for the push at the end of the quarter. So when that rep is just closing six deals all in the last two days, and you know who that rep is, but those tend to be the moments where you’re pushing extra risk. You’re willing to take on more risk and the risk isn’t bad, like running a business requires risk. It’s just, is it a risk you’re willing to take or is it a risk someone took because the reward was so high?

Rich (30:12):
Sanj, it’s probably worth it to unpack that a little bit. We have a few questions here about when you say low quality, what would that look like or feel like? And I certainly have some ideas, but I’d love your perspective.

Sanj:
I define low quality is either taking abnormal contractual terms. Like, “Okay, we’re going to let you take term for convenience,” when we don’t normally do that. The other one is they seem to be more likely to churn well in advance of the normal renewal cycle. So we’ve seen examples from customer data where they typically have renewals for three or four years, but the deals that pushed into this rate, all terminate after the first year.

Rich:
And I think another thing to look at there going into the terms is looking at those deals, and if you’re running a complex sales process, these are the ones that are probably not quite using it the way that it’s supposed to be, or maybe it’s in my past life, it would be a vertical where we’ve really had never had success and then have a lot of failure. There are probably some other more macro business things that you could look at there as well.

Sanj:
Yeah, absolutely. I think you can create more rules around how people get there, but part of why people are pushing for these deals is that accelerator. And please know, I’ve made literally every one of these mistakes myself. I worked for an email marketing company earlier in my career and we set one of these really rich accelerators. And then we had a rep who sold $100,000 deal to a company that sent no consumer email. And people laugh at that and they’re like, “Ha, ha, ha, what a great sales rep!” But actually, what a horrible customer experience. And who knows why that customer actually bought? It’s still such a terrible experience. It makes us look like we don’t know what we’re going to do. And the only way that I knew about it to terminate that contract immediately and refund the customer right away is because the account director said, “Hey, this one’s definitely going to churn because they don’t send email. Can I make sure it doesn’t hurt me next year?”

Rich (32:40):
That seems like a really good way to make sure that it identifies low quality, they’re not using your product. The next question is, shouldn’t it be someone’s job to prevent that? The deal desk or the VP? Sanj, I’d love your perspective on where bad deal prevention lies.

Sanj:
I would say, it ultimately falls on the rep. This person spent time on closing this deal that is totally worthless. And that at some level they must’ve known it’s totally worthless to the company, as well. Yes, could deal desk have caught it? Potentially. It depends on what deal desk is reviewing. If they’re actually reviewing the contract, the contract wouldn’t indicate that the customer didn’t have a need for the services. It didn’t do the N in BANT, that’s not what they’re checking.

Rich:
I think with this too, it depends a lot organizationally. In a past life, whenever we had a deal that we would describe as a fishbone, that’s how we knew it was just going to be a bad fit. We would sit down and we’d have a fishbone review meeting and it was the organization’s decision to take a fishbone. We took that out of the rep’s hands because, while I think Sanj is really well-intentioned, reps they’re like water, they’re going to flow to the point that gets the deal done. And if you don’t put the guard rails around them, you can end up with silly behaviors. So we would have a fishbone review, and at the end of it, if we decided we were taking a deal, we would take the deal.

Sanj:
You knew what you were getting into. You probably pre-cleared it with the CS team saying, “Don’t worry, this one’s not going to hurt you for churn. Don’t worry, we know this customer doesn’t send email.” So I think there are a few ways to stop it, but ultimately, I would push this back to, your rep is spending time on this instead of a real deal that’s actually worth money. So as much as you can, you want to put that filter in the front where the rep doesn’t even go for that bad deal. And these rich accelerators do push people to that. They see a quick path to close for a customer who maybe doesn’t know enough about the problem to properly assess whether it’s a good fit or not.

Rich (35:25):
Great conversation here. I love that commentary. Another point on this, Sanj, too is just we’re talking about the AE perspective of the rep. We’ve talked a little bit about customer success. How much of this pulls through to the folks that are on the front-end here, your BDRs or your SDRs, the opportunities. Do these still hold true?

Sanj:
Yeah, these absolutely do. So same thing if you’re talking about, I have BDRs and SDRs, if you give too rich of a meeting incentive, you’re going to get lower quality meetings. If you are paying on accounts touched or volume of prospecting that goes out, your prospecting starts more closely resembling spam.

Rich:
Yeah. The analogy here I think is also like, Goldilocks. There’s a right place to set this where it drives the right behavior. But also isn’t going to result in me as a seller, having a meeting with somebody that can’t use my technology.

Sanj:
Right. And I will also say that most people show up at work trying to do a good job. They’re not trying to screw you over. They’re not trying to take all of your money. They want to do a good job and hit their targets the way that they’re supposed to. But sometimes we introduce these things that change the evaluation criteria in our brains.

Sanj (37:04):
So tip six, Olympic themed: Turn off the leaderboard. This is probably one of the more controversial things that we tend to recommend to people. But a three-year study looked at the performance of 1,700 reps. This study was done by the University of Pennsylvania. And it found that over those three years, if you turned off the leaderboard, reps did 11% better on average. And this applied evenly to top core performers and low performers. So everyone across the board does better when you don’t show the leaderboard. And the reason why we’re showing, Simone Biles’ vault score here is because if you look at vault 1, she was way beyond her competitors to begin with.

So if you’re that high of a performer, you don’t really pay attention to the rest of the board. You’re beating yourself. Vault two is better than vault one, not because she thought she wasn’t going to win the gold. Simone Biles is the best case study for why your top performers shouldn’t be moved by the leaderboard. Going into the Tokyo Olympics, the starting value of the skill she’s executing, she could fall on every single discipline and still win the gold. So that’s not why top performers perform. And if anything, it actually just harms everyone lower in the stack because they’re like, “Why even try?”

Rich:
That’s really interesting. I think I also think with this too, leaderboards as we move more fully remote, I feel like it’s an office thing in a lot of ways. You get big TVs and tunes blaring and all of that. So this is a timely point for sure.

Sanj:
Yeah. And I think it assumes that sales personalities are similar and ignores that everyone on your team is still an individual. And they may or may not like having a song blaring or that may or may not be motivating to them. It does more harm than good in most cases. People really struggle with this. Every time we talk about turning off a leaderboard, someone will say, “Well, I know for my team, this, this, and this happened because of our leaderboard.” And that anecdote is really strong, but you don’t have 1,700 reps and three years of data. You have one story that seemed to work for one quarter and ignored everyone else who it didn’t work for.

Rich (40:10):
The other question on this too, and this is a live question, same thing that I had too. How do you share the results though? How do you let folks know what other people are up to? I don’t know enough about the study to answer this one.

Sanj:
So you can share the results, probably, the most effective way that the study recommends sharing the results is in aggregate. So if you say, “Rich is at 98% of his annual target, today on July 6th and the team of Sanj and Rich are 50% towards our target.” What that seems to do is, well you would be like, “Well, I’m at my target, but let me try to help the team along a little bit.” And if I’m seeing that I’m at 30% and that the team is at 50%, I’m like, “I’m really not pulling my weight. Let me figure out what I can do differently to help the team out.” So again, it’s like approaching things collaboratively and compassionately, not competitively.

Rich:
Okay. That doesn’t feel right… It’s one of those ones where I feel like I’m putting my watch on the wrong hand. That just feels a little bit different.

Sanj:
It is really different. And the other thing I would say you can do that is not posting a leaderboard is like if you’re sending out emails or slacks whenever a deal closes, people figure out how people are doing overall. Or you can even celebrate them verbally at the end of a period. Not necessarily having it in someone’s face all day, every day.

Rich:
Interesting. I’m going to have to check that study out. That sounds pretty sweet.

Sanj:
Does it? Or does it sound deeply uncomfortable?

Rich:
We’re here to learn. We love having Sanj on, to challenge us to think a little bit differently.

Sanj (42:21):
So the last tip is encouraging meditation. So certain meditation techniques, less so on just breathing, but more visualization exercises can help close your distance towards any goal. The reason goal visualization, in particular, is so valuable to people is that it helps your brain slow down a little bit and build the connections between your target and the actions you need to take to get to target. So subconsciously, while you’re trying to clear your brain out, while you’re focused on your breath, while you’re thinking about your goal, your brain is building the connections behind it to figure out how you’re actually going to get there. And the real interesting thing about meditation is, there’re a bunch of MRI scans that are done on monks, who meditate a lot, versus an average person. And what they show is that monks are able to activate the stressed response of their brain in a controlled way and the introspective part of their brain at the same time.

So for the average human, this is called fight or flight where we can actually impact one stress response, and that’s it, we’re just like a seesaw between the two. But monks are able to lift both sides of the seesaw at the same time, so they can activate both parts of their brain. And what that really means is they’re able to be highly responsive, but also very measured in their response. And that is a unique skill that would benefit really any seller, but to the tactical side of it, people who meditate feel like their goals are 30% easier, whether or not they actually are. And you’ve seen that while they’re working hard, it feels easier, they’re able to move through faster. It’s probably one of the squishier things that I’ve learned along the way, but also probably one of the more easy to roll out impactful things, it’s interesting to share with your team and it costs no money.

Rich:
Yeah. I’m curious about this, sounds squishy to your point. Let’s take this one level deeper tactically, how would you encourage the team to start to meditate? How have you seen this actually rolled out to organizations?

Sanj:
There are a variety of issues in forcing it, you cannot force anyone to meditate.

Rich:
You put a meeting on the calendar and we’re going to meditate for these 15 minutes and you’re going to like it!

Sanj:
Well, you can say this is blocked off on everyone’s calendar to take this time and take the time any way you want to. A lot of this is really hard to get started, but the more you do it, the more you fall into the habit of it. And you can work with your team to gamify it or create more habits around actually meditating.

Rich:
Of all the things, I think, I knew this point was coming, but still, the last two feel the most… I’m going to chew on those a little bit more.

Sanj:
Yeah. They are going to push you out there. But I think what we’ve seen is that they do have phenomenal results. And whether you actually are totally bought into them or not, you have to admit it creates a different culture that is a little bit less cutthroat, a little bit less competitive and allows people to maybe be a little more creative in their work or to be a little bit more thoughtful and less reactive.

Rich:
It’s interesting. And then question- any resources for visualization or meditation in general?

Sanj:
Yeah. So you can use a meditation app. It doesn’t have to be a goal visualization. I would just say it should not be totally breath-work-focused. It has to have a purpose around it or a target around it. So you can use apps to do it, whether its Headspace or Calm. I think as part of the follow-up, we have a specific sales goal visualization that we can share that we had put together and had someone record for us.

Rich:
This has been an exciting journey. Maybe we recap the seven steps and then we’ve got a little bit of time for questions here.

Sanj (47:40):
So final thoughts, mid-year is a great time to roll out changes. You have this natural moment where you can say, “Okay, we’ve learned a lot so far this year, this is your new plan.” Instead of waiting too long and then saying, “Yeah, we’re totally screwed. Here’s the new plan, hopefully, you can do better.” Don’t be afraid to overpay, especially in terms of thinking about building habits. If you have to double comp people here and there, just do it. Remember your team wants to hit their targets. It’s what people are built to do. So as much as you want your team to hit their target, they want to hit their target even more. And then finally, don’t forget the science of tying the quota to the behavior, to the commission, and repeating that so that you’re actually seeing the behaviors that you’re looking for.

And a reminder of the seven tips, take this chance to reset your quotas now, both what you’re measuring and at the time period that you’re measuring it over. Set multiple accelerator tiers, try to switch to monthly quotas if you can. Focus on paying on the right habits, so that can mean paying on pipeline activity. And then stop those really rich accelerators. And, Rich’s favorite of turning off the leaderboard and meditating more.

Rich:
It’s the art and the science of hitting quota here.

Sanj (49:33):
And on the meditation point, I worked with a revenue leader who would often say, “Hope is not a strategy.” It turns out meditation is.

Rich:
Interesting. Hope is not a strategy. I’ve heard that before. Sanj, I actually have a question for you around monthly quotas and you touched on this a little bit with building the right sales habits. Back to that and back to the big deal cycle, again, longer sales cycles. Would we say maybe we keep the quota of whatever it is, but there’s incentives on the activities of the leading indicators, whether it’s opportunity creation, pipeline generation, deal advancement, things like that, that would be the precursors of the big whale getting closed when it closes?

Sanj:
Yeah, absolutely, especially in long sales cycles, like paying on those habits or the pipeline indicators, is really, really important. But even for us, we have somewhere between a one and two months sales cycle, we pay on the leading indicators and it has massively transformed both our win rate and our close rate.

Rich:
There’s a metta benefit maybe for your sales leadership as well, where you can look at the precursors and say, “Hey, we’re going to miss, unless we change these things.” I’m not looking at the end of the quarter, trying to scramble to get deals done. It’s like, “No, if we don’t do pipe gen now, a month from now that’s going to show up two months from now, it’s going to show up.”

Sanj:
Right. And you also can figure out what are the quick hit things that you can do to try to boost that number up. So for falling short of our number in a given month of discovery calls that we want to have, we know that we can maybe reuse this one list that we have with a different sequence and more customization. And that would be the quick hit thing we know, this type of profile can convert very quickly.

Rich:
Interesting. It’s funny with comp, it sounds so much more complex than it is, but when it starts to plug into other parts, organizationally, you can start to get some really good insight on what’s going on.

Sanj:
Yeah, absolutely. When we talk about comp, we’re actually talking about your sales process. You have a complex sales process. You might have a complicated comp plan, but if it matches your sales process, there’s no problem.

Transcript has been edited for length and clarity 

7 Compensation Tips