Petra Pereira· HR Business Partner, Bellwether Consulting
Asked in Sales Compensation ·
Setting quotas for a product line with no sales history and a forecast nobody believes
US medical devices company, around 180 sellers. In January we launch a new surgical product through a dedicated team of 20. Marketing's forecast for year one has changed three times since June and the range between the low and high cases is fourfold.
I have to set individual quotas by early December. If I use the high case, most of the team will miss and we will lose people we have just hired. If I use the low case and the product takes off, we will pay out several times target.
How have others set quota in a first year where the forecast is this uncertain?
3 helpful · 1 insightful · 3 replies · 127 views · 6 following
Accepted answer· by Quentin Jimenez
Do not set an annual quota. Set the first half on the low-to-middle case with a team-based measure, then reset for the second half on actual run rate. In a launch year we paid 50% of the incentive on team revenue and 50% on individual milestones such as surgeons trained and accounts through value analysis committee. It bought us six months of real data before anyone had an individual revenue number.
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