Stop Putting Buffers on Quotas Now!
Nov 26, 2024Stop putting buffers on quotas.
Instead put buffers on pipeline.
This means scale DEMAND ahead of HEADCOUNT.
Yes, it's the opposite of what most do.
Usually they want to add salespeople in hopes of them creating more demand.
On top of that they add a 20% buffer to everyone's quota so if the team hits 80% of their target, the company hits 100% of theirs.
The end result is this:
1. An expensive and bloated sales team
2. Low average quota attainment
3. Horrific profitability and unit economics
Instead do this:
1. Scale demand generation ahead of headcount
2. Hire salespeople when current reps are too busy
3. Provide 20% pipeline buffer so they hit 100% quota
It may be harder to paint a picture of hyper-growth.
But you won't have to layoff half your sales team in 9 months.
Salespeople, sell for companies who comprehend this.
Best of luck to all the rest.
This is a scary transition for many executives because they think the 20% quota buffer is what guarantees their success.
But they fail to realize quota does not drive revenue.
That's actually what pipeline does.
So if we put our focus on driving a 20% pipeline buffer (more pipeline than we can handle) our efficiency goes through the roof and everything works out.
Happy Selling,