2019 may feel far away, but now is the perfect time to start planning for it. Join Joe Gelata, VP of Business Operations at Axonify, as he discusses strategies for: - Capacity planning - Building predictive funnel models - Target setting - Territory development - Rep compensation Whether you do these yourself or work with Sales Ops, it’s important to understand each in order to setup your team for success next year. Joe will discuss high-level strategy and tactical execution of each component including how it can be done, things to consider, pitfalls to avoid, and how to align with the rest of your organization.

1. SUCCESSFUL SALES
PLANNING

2. “Always plan ahead. It wasn’t
raining when Noah built the ark.”
~Richard Cushing

3. AGENDA
0. Agenda & Rev/Biz Ops
1. Target Setting (Company)
 Bottom-up
 What you need to do
2. Capacity Planning (Sales)
 Top-down
 What you can do
3. Territory Architecture (Team)
 How you can do it
4. Compensation Plans (Individual)
 Who can do it

4. Centralizes the operational functions of all
groups across an org such as Product
Management, Marketing, Sales, and Customer
Experience.
Rev/Biz Operations
• Create an Insights Driven Organization
• Align processes and data across the entire
customer journey
• Build a scalable Business Operating System
Goals
REVENUE & BUSINESS OPERATIONS
INSIGHTS TOOLS OPERATIONS ENABLEMENT

5. PRO TIP:
Be conservative with ALL your
assumptions
• Don’t lie to yourself!
• Avoid having to make excuses later
• Helps justify what your really need

6. TARGET SETTING

7.  TARGET SETTING IS CRITICAL TO SUCCESSFUL PLANNING
 All other components are dependent on it
 Determine targets for the full funnel (not just a revenue target)
 It’s a big lift
 Top-down (what you can do) vs bottom-up (what you need to do)
 Use bottom-up: start with company revenue targets and work back
 Determine targets in phases:
Target Setting
Step 1: Understand Funnel Structure & Revenue
Targets
• Company Targets (Board) + Channel/Team Targets (CEO/COO/CRO)
Step 2: Develop Funnel Targets
• Funnel Targets (each team working together)

8. Step 1: Understand funnel Structure & Revenue
TargetsFunnel Structure (SiriusDecisions Demand Waterfall)

9. •50% Marketing
•25% BDR
•25% Sales
•20% Inbound
•80% Partner
•20% Inbound
•40% Marketing
•40% Sales
Source
•$1M SMB Sales
•$4M Enterprise Business Sales
•$1M NA Partners
•$1.5M International Partners
•$0.5M Customer Success
•$2M Customer Sales
Teams
•$5M New Business
•$2.5M Partners
•$2.5M Customer Expansion
Channels
•$10M New ARR
Company
Step 1: Understand funnel Structure & Revenue
TargetsRevenue Targets

10.  Gather historical performance metrics for each channel in the
funnel
 Average deal size
 Conversion rates
 Velocity (days in stage)
 Set assumptions based on historical performance
 Be conservative with performance improvements until they are proven
 Calculate targets at each stage of the funnel
 Start with revenue targets and work back for each channel
 Goal: determine what needs to be generated when and by who
Step 2: Develop Funnel Targets

11.  Channels (lead flow paths) get complicated
 Each team may receive inputs from multiple sources and push output
to multiple destinations = multiple funnels
 In some cases lead flow may bleed between funnels
 This complexity needs to be distilled into targets for each team
 All of this needs to be distilled into targets for each team…
Step 2: Develop Funnel Targets
Inbound Enterprise
Direct
Outbound Enterprise
Direct
Inbound SMB Direct
Outbound SMB Direct
Customer Upsells
Customer Expansion
NA Inbound Partner
International Inbound
Partner
Outbound Partner

12. Step 2: Develop Funnel Targets
Enterprise Sales Sample Sample Targets
Assumptions
 Average deal size: $100k
 Conversion rates:
 SAL to SQL: 80%
 SGL to SQL: 50%
 SQL to Won: 20%
 Velocity (days in stage)
 SAL to SQL: 90 days
 SGL to SQL: 90 days
 SQL to Won: 90 days
 75% SAL + 25% SQLs
TARGETS Q1 Q2 Q3 Q4
SAL / SGL 47 SQLs / 25 SQLs 70 SALs / 38 SQLs TBD TBD
SQL 50 50 75 TBD
Won $0.5M (5) $1M (10) $1M (10) $1.5 (15)
TARGETS Q1 Q2 Q3 Q4
SAL / SGL 47 SQLs / 25 SQLs 70 SALs / 38 SQLs TBD TBD
SQL 50 50 75 TBD
Won $0.5M (5) $1M (10) $1M (10) $1.5 (15)

13. Step 2: Develop Funnel Targets
The Importance of Velocity

14.  DO NOT IGNORE VELOCITY
 A lead generated today may not become revenue until next year
 Revenue this year was a lead generated last year…or wasn’t!
 Planning early is critical to staying ahead
 Implement a rolling planning
 Plan ahead by 125% of a
full lead-to-revenue cycle
Step 2: Develop Funnel Targets
The Importance of Velocity
Inquiry
AQL
TAL
TAL/TGL
SAL/SGL
SQL
Won
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

15.  EVERYONE needs to be involved in planning
 All targets need to be aligned and approved
 Nothing divides marketing and sales like conflicting targets!
 Funnel & Target Manager
 Assign an formal target manager
 Revenue/Business Ops, Marketing/Sales Ops, Finance
 Determine where targets are published and shared
 Develop review and approval process for target changes
Target Setting Tips

16. CAPACITY PLANNING

17.  Capacity Planning: Ensuring your BDR and Sales teams have
adequate production capacity to meet targets
 Capacity is not a sum of quota
 10 reps x $100k Quota does not equal $1M capacity
 Do this early so you can hire, onboard, and ramp
 Don’t underestimate how long this really takes
 Compare capacity & targets regularly to highlight issues and adjust
Capacity Planning
1.Set assumptions for
production
1.Calculate capacity
requirements
1.Develop hiring
schedule

18.  Based on REAL historical data, set the following assumptions:
 Production capacity/Quota:
 Number of deals a rep can realistically win
 Average Deal Size for each team/segment
 Rep Turnover
 How many reps you expect to turn over (25% is not unrealistic - don’t
let your first few loyal reps fool you into a sense of security)
 Ramp Time for new reps
 How long it takes reps to attain quota
 Early reps will ramp faster than later reps
 Consider your investment in Sales Enablement
Capacity Planning
Step 1: Set Assumptions for Production

19.  Based on the assumptions from Step 1, calculate how many reps
you need to hit target and when you need them ramped
 Build in a lower quota attainment rate (e.g. 60%) to account for
under performers
 Calculation Summary
 Rep Quota = Number of Expected Deals x Average Deal Size - Ramp
 Rep Capacity = Quota x Quota Attainment Rate
 Total Capacity = Rep Capacity x Number of Reps x Rep Retention Rate
 Example
 10 Deals x $10k ADS = $100k
 $100k Quota x 60% Attainment = $60k
 $60k Capacity x 10 Reps x 75% Retention = $450k (not $1M)
Capacity Planning
Step 2: Calculate Capacity Requirements

20.  Schedule hiring to fill the delta between your current roster
and your required roster
 Plan for attrition in January (involuntary)
 Repeats the capacity planning process for all teams including
BDRs to insure sufficient leads to sales
Capacity Planning
Step 3: Develop Hiring Schedule

21.  Be conservative: Do Not Include Improvements in Your Model
 Until you can prove an improvement is working, do not model it
 There are many things that will prevent improvements from becoming
a reality
 If you plan for it and it fail, you put your whole year at risk
 Better to under-promise and over-deliver
Capacity Planning Tips

22. TERRITORY ARCHITECTURE

23.  One of many methods for building territories
 Tips: Different territory models fit different company stages
 Tightly defined territories work in mature, predictable markets
 Early markets require more flexibility so don’t over segment
Territory Planning
Segment Based Territories
1.Calculate
addressable markets
Gather account data
Divide into
Territories
Assign and roll out

24. 1. Review all SIC (or NAICS):
 Categorize them into target segments, incubator segments, no-fly
 Weight each SIC by the % of addressable employees
2. Gather account data
 Acquire data on all accounts in your target and incubator segments
 Calculate an ‘Addressable Employee’ number for each account
 Addressable Employees = Total Employees x SIC Weight
3. Addressable Market Summary
 Sum accounts in each segment to determine # companies and employees
 Compile historical data on each segment:
 Average Deal Size, Win Rate, # Customers/References
Territory Planning
Segment Based Territories

25. Territory Planning
Sample Addressable Market

26. 4. Calculate number of reps required in each segment
 Determine criteria for “fair” territories (potential revenue) and
divide equally
5. Cut each segment into territories by whatever makes sense:
 Subsegment (allows for highly targeted messaging)
 Geographical grouping (if travel is required)
 Company size (growth vs enterprise)
6. Do market penetration for a sanity test
7. Assign reps based on best fit (e.g. location, industry
experience, etc.)
Territory Planning
Segment Based Territories

27. 8. Document Territories & Launch
 Create documentation including:
 Description of each territory and it’s stats
 Rules of Engagement
 Hold over rules during transition of territories
 Review with reps 1:1, allow time to change if necessary
 Load all account data into CRM and assign as needed
Territory Planning
Segment Based Territories

28. Territory Planning
Sample Territory Details

29. COMPENSATION PLANS

30.  Develop plans for everyone: Reps, BDR’s, Sales Engineers, etc.
 Tips
 Keep it fair, simple and tie performance to comp
 Get feedback from sample of reps and make adjustments if needed
 Great article from Sales Hacker: Sales Compensation Blueprint
Compensation Plans
1.Identify
Strategic Goals
1.Set OTE &
Salary Mix
1.Define plan
1.Plan
Governance

31. 1. Identify strategic goals:
 Disrupt a market?
 Land grab?
 Maximize revenue and efficiency?
 Drive clean deals?
 Who needs a plan? reps, BDRs, sales engineers, ops, etc.
2. Set OTE & base vs variable mix
 Base on your goals and market conditions
 Salary pays for following process and keeping clean data
Compensation Plans

32. 3. Define your plan by linking levers to targets
 Revenue (one-time vs recurring vs services)
 Commission Rate (contract length, terms, product, pilots)
 Accelerators (over quota, hitting consecutive quarters)
 Timing of payment (contract signing, revenue collection, launch)
 Customer Retention (penalties for churn)
 Team bonus
 Split between reps
 Deal value vs quota relief
 Cap or Big Deal Clause
 Comp during on boarding/ramp (draw, activity based variable)
 Termination of employment
Compensation Plans

33. 4. Define a governance process
 Who makes the call if issues arise
 What visibility do reps have to performance in cycle
Compensation Plans

34. SUMMARY

35. PLANNING SUMMARY
TERRITORY ARCHITECTURE
 Calculate addressable market
 Cut fair territories
 Discuss details then roll out
TARGET SETTING
 Understand funnel & revenue
 Set targets using funnel workback
CAPACITY PLANNING
 Set assumptions for production
 Calculate capacity requirements
 Develop hiring schedule
COMPENSATION PLANS
 Identify strategic goals
 Set OTE + Base/Variable mix
 Defint plan and governance
TODAY 2019

36. TIPS
Be conservative
Plan early & don’t
ignore velocity
Assign a manager of targets &
develop approval process
Review performance &
refresh targets
Choose territory & comp models
appropriate to your stage
Keep comp plans
fair & simple
Get feedback on territory and
comp plans before roll out
Involve all teams in
funnel planning to
generate alignment

37. QUESTIONS ANSWERS