#108 Using Comp Plans to Drive Company Performance – with Ryan Milligan, CRO at QuotaPath

[MUSIC] Welcome to the RevPslap, a podcast exploring the art and science of revenue operations. To find more episodes and resources on scaling your revenue engine visit get weflow.com/webops. [MUSIC] Hey, this is Philip from Weflow. Before we dive into today's episode of the RevPslap podcast, let's do a quick real talk. We talk to RevPslipers every week. I mean, actually every single day. And we keep hearing the same things. Our Salesforce data is a mess. Reps won't update Salesforce. They don't follow methodology. Everything is inefficient. The adoption is poor. And all of this is exactly why we build Reflow's revenue AI platform. Because Reflow automates Salesforce hygiene by capturing every customer interaction automatically. It locks your emails and meetings as activities in Salesforce and creates missing contacts automatically. Weflow also records and transcribes your meetings and uses AI to update Salesforce fields, create summaries, and to sink everything back to Salesforce. Let's say you have some key fields like Metaq or Next Steps. Weflow can auto update them right after your meeting. Reps just review what we suggest to them and then make changes if they want to and confirm everything with one click. That way, you get Clean Day Salesforce data while your Reps save time on data entry. If you want to see where hundreds of your RevPslips peers trust Weflow, just go to Weflow.com to get your free trial today. [MUSIC] Hello and welcome to another episode of the ReffRub's Lab podcast. I'm here with Philip and our guest today is Ryan Milligan. Ryan, hey, how's it going? Good, thanks for having me. We're all safe with us. Yeah, so you're back. You've been here before. Unfortunately, I couldn't join the last one that I'm super excited to talk to you about all things compensation today. But before we dive in, you just became Sierra with QuaterPass, Congress. You have a ReffRub's background. We don't see that as often as we would love to, but just curious how the past to Sierra is someone who started out as a ReffRub's? Yeah, so thank you. It's been a fun journey. I've been here for four years now. I was originally hired to lead RevOps here and then roles expanded taking on sales leadership and marketing leadership position for a CRO change earlier this year, which has been a lot of fun. I think my take that is very funded to debate with people is that RevOps leaders are well suited to be CROs. I think particularly why they're well suited is because they are agnostic to department and really focused on the needs of the business. The CRO role is not a amplified sales leadership role. It's a what is the best, most durable, sustainable revenue for the business role. A CRO's responsibility is to say, okay, where are we going to invest our energy that has the best return from a healthy revenue perspective for the business? Is that in marketing? Is that in sales? Is that in customer success or account management? And so the job is orchestrating where the business should spend the bulk of its time to get the most return and solve pain points for the business. So RevOps as a role already has that ability to be organizationally neutral and operates kind of organizationally neutral to like break down some of those potential political barriers within an organization. And so that's where that systems architecture process and building a well oiled machine really steps in really well in the CRO role. Now I think there's an interesting question for a lot of CROs are VPC sales who've risen up through sales ranks to enter a CRO versus RevOps leaders who go that route. Both have to learn something. Right? So a VPC sales stepping into a CRO role has great selling experience and great knack for how to get a deal across the line and then has to learn systems architecture process, post sale, how do I build like a humming engine and how do I you know message that to a board? That's what a VPC sales has to learn. And then a RevOps leader has to learn all of the closing, I never carried a quote us. So has to learn how to close a deal, the art of mechanics, the art of selling alongside a team. My take is that if you have a sales team that is strong and performing really well, you can supplement their closing skillset as a RevOps leader moving into CRO with some of the systems architecture to build for scale and durability. And so not just both both are great paths. You know, I want to be very clear on that, but I do think RevOps leadership is one that can step into CRO very effectively. One follow up question here. How about hiring, right? Like RevOps seems a typically small go to market teams sales, customer success, a lot larger. How do you become graded hiring from a RevOps perspective? Is that something that it's learned or? It's very interesting. So my team in the past four years has grown from one to almost 20, right? So that's an interesting developmental change for me. I think what you have to think about is what are the skillsets you see within a great seller that you work with already? And how do you test for that acumen in the hiring process? So you've been a RevOps leader observing what is great about reps. They, you know, asking great discovery quantitatively sharp. We're a technical sale, right? So understanding the mechanics of of every single org's complaint and asking really probing questions to see what they're trying to do with their plan. I in the hiring process build tests for those things in it, right? So an example is if you're selling quota path, you're getting five to 10 new comp plans every week from people who are looking to use quota path and they want to see a technical proof of concept of their compensation plan in quota path. So I am testing a rep for their acumen to see a comp plan understand it, understand the drivers and then build that in the product. And so we send them basically an excel case process of calculate commissions for a team of 40 in Excel. Like do that in Excel, know the pain, know what the buyer's coming from, show me that you know how to do it, show me know how to like understand the mechanics of the comp plan. That will build empathy for you to be able to sell quota path. And it makes sure that you understand the mechanics of how comp plans work all together. Awesome. Awesome. Well, congrats. It's awesome. I think Philip and I are happy to see you, you know, taking on this role and I hope many of you out there will have similar path. So that would be awesome. So today, our topic is, I mean, you're an expert in compensation and before we started to record and we talked about how you can use compensation planning as a tool to drive company performance. Right. So I mean, maybe explain what you mean with that. And then we're going to go into the new security details as always. No, it's too. So basically, the old way that I think about was that you design a revenue plan for your business, you figure out your capacity, you figure out the reps and the territories and all that sort of stuff and you're ready for the next year. And then on December 18 through 21st, you realize, oh, I need a comp plan. And so you've done all this upfront work as a business to figure out how 2026 is going to be a super successful year. And then all of a sudden, you take the comp plan and kind of like add it on on the sidecar at the end. That's like the old kind of historic way of doing things. And frankly, we talked a lot of teams who are still operating in that model are push and our hypothesis, what we've seen in action is that your compensation plan should be way the forefront of how you're planning for next year and simply put your compensation plan is the best tool you have to drive your go-to-market teams to deliver the right revenue for your business. And maybe the right revenue is longer term contracts. Maybe it's a move into the enterprise. Maybe it's selling these three products at the same time. You should be able to use your comp plan to tell your go-to-market team what great looks like and reward them for great. So they focus their energy on closing more durable, sustainable revenue for your business and that's the ultimate call. And so our push in our product, you know, we automate the process of calculating commissions sure. And we help you use your comp plan to show a seller, hey, here are three deals in my pipeline. I'm going to make the most money on deal three, even though it might be a little smaller from a revenue perspective because it's a three year multi-product deal that's great for the business. And so the business is rewarding me. So it's the one time in which I win in my wallet, the business wins. CFO is happy because we have less churn and durable revenue and CRO is happy and everyone's happy. And so that's the thesis is use your comp plan to drive sellers to close better revenue for your business and bring the comp plan way earlier into your planning than this sidecar attachment in late to some. Yeah. I mean, I mean, something, I mean, that we also went through like at WeFlow is like, I mean, when you first start out like you hire first salespeople, right? Like you have a different incentive. Like you start with the first salespeople, like you maybe like a bit more generous on the compensation. You don't really know how it's going. Like then you start thinking about, okay, you know, how should I like should I add like an accelerator at some point. And then basically my point is like as the company like progresses as it matures, like you constantly have to actually adjust your comp plan. And like we know of some of our customers to actually adjust their comp plan, like, you know, every quarter. And you know, like really like to to recalculate like at least like a few things, maybe not fully, right? Like in some like specific areas. Because like, of course, like as the company, Mature's also, we actually do have different strategic goals, right? Like, it might not be like a growth at all costs, like a younger early stage company might have, but it might be something like these said, like here, like the multi-year plan, right? Like, okay, how do we get to stable, like, long-lasting revenue? How do we reduce, how do we reduce attrition? So, I think that's just a super interesting perspective to not look at a compensation plan as like this static thing that you kind of like set, and this is like, you know, it is what it is for like a full year, but to look at it, like from a very dynamic perspective and to treat it as such. Yeah, I mean, you think about you do call coaching consistently, you do enablement consistently, you should be using your comp plan with the same level of consistency to change what you want from the team. Now, you got to be a little careful with Whiplash, right? So, you got to make sure that you're like very clearly communicating and what's different. What I tend to advise is, hey, the core way in which you're earning your OTE paying for healthcare, like supporting your family, like your core comp plan should be pretty, you know, static throughout the course of the year. It's these accelerators, kickers, like things that you can earn on top of that you should feel much more comfortable changing monthly or quarterly as the business needs change, right? So, you know, and it's interesting you talk about the the arc of a plan. Oh, and the reason I think about you change those more consistently is, hey, like that's not detracting from my ability to like, you know, support my family, right? You don't want people to feel like a lot of a Whiplash on this, but if you're saying, hey, this quarter really focused on testimonials. So, I'm going to spiff you on testimonials and next quarter really focused on selling product B, you should be able to do that, no problem. And ultimately, I think the goal is to bring a business on its journey, right? And so, like when I joined Quotipath four years ago, we had a lot of month-to-month contracts. We don't sell month-to-month contracts anymore. We had a lot of month-to-month contracts because of earlier stage business and we were trying to drive customer growth and get people to adopt the product and and it was it was a much different like revenue maturity than we are today. And so our main focus was let's convert month-to-month contracts from people who see a lot of value to annual commitments so we can invest more from a support perspective and give them more what they need to be successful long-term. So we went through that journey and then we went through a journey about two years ago, hey, you know, annual contracts don't give us the ability to give them as much upfront value from an implementation and support perspective that we want to. Let's create the value over multi-year contracts and we've shifted the business that way, which I can talk about. And so, you basically are using the comp plan to change the revenue for what your org needs at that point in time and that becomes super important. Yeah, like, I mean, like, how do you think about composition planning in general? Like, you know, I think we had like a few episodes here on, like, for example, an SKO, magic, and things like this. So, but like, where do you see like a compensation plan? Like, like, when do you start in the year? When should it be ready? Like, yeah, just in general, like, I think it's worth taking a good step back and like, you know, helping out audience, like, you know, like some kind of like framework on how to actually operate with like a composition plan. Yeah, so I think you have a couple really interesting moments in time. I think about a calendar in this way. One is you're coming up to H2 before, you know, before you know that you're going to be in the second half of the year. So one thing you should be doing now is thinking through. So in the, like, the Fed March timeline is how well is the comp plan doing within Q1 at driving the behaviors we're looking for and can we build towards any sort of change in H2? So is that what's our attainment looking like? Are we closing the right types of deals? What percentage of our deals that we're closing, both on new business and renewals are ideal customers or are in longer term contracts or are above an average contract value of, you know, 30k or whatever. You have to go back to what you told the board. This is how the revenue plan is going to go and here's here the drivers of why we're going to succeed. We're going to double our average contract value this year. Okay, have you double your average contract value in Q1? Yes or no? And if not, now you're thinking about, okay, how do I make it more lucrative for reps to close better revenue for the business, whether it's larger deals or, you know, whatever the business needs? So you have a moment now to start planning for H2. Let me see a lot of orgs changing their comp plan in in that like July, you know August time frame. That in terms of 2027 planning, which is kind of crazy to say, typically, I mean the sticker shock is like August. August is when I say, hey, August September is the kind of time where you're where you're starting to do a couple things. One is you're interviewing your team. I think this is the biggest thing that people miss. You're interviewing your reps, your SDRs, your marketing team, your AMs. What do you like about the comp plan? What do you not like about the comp plan? And the most damning question explain it to me. So, you know, revops, things they built this like beautiful mechanical system and then they go to an account manager and say, hey, just explain your comp plan to be like, what are you motivated by? And the amount of jaw dropping where I have they have no idea what we're trying to motivate them to do. You know, that's a problem. So you're doing kind of informational interviewing up front August, September. There, you're really trying to learn from them. Some nuggets on what they like and don't like about the plan because naturally when you change a plan, there's going to be some gifts and some gets. You want to understand what those gives should be or what would make a team excited. Maybe it's quote, evocation relief for a quarter, you know, two weeks off of a quota or maybe it's switching from monthly to quarterly, whatever. You want to have those in your pocket. So you're doing information interviewing late summer. Then in early fall, you're starting to think through your revenue plan for next year and you're working with your, if you're in a Revops seat, you're working with your CFO and your CRO to understand what the business needs to be successful next year. And how does the revenue have to change or relaunching any product? Do you need how you attach right there? Do you have to move into enterprise? What are we going to talk to some examples in a second? And you're figuring out what the business needs and then you're coming up with, okay, then what are the levers of the comp plan? How much coverage do I need from a quota perspective? You're doing a lot of that work in like September, October. And then ideally come November, December, you're actually rolling out the plan to the team, getting them enabled, answering questions, having feedback. So when they show up on the door on January 5th, they have their comp plan in hand, they're ready to run. They're not waiting till January 23rd to get the plan and floating for three weeks, which is just wasted time. The one thing I will say that's helpful in this is if you're a Revops leader listening, Revops leaders always say, I want to be more strategic and like I want to work on like larger media problems, there is no better problem to take with both hands than complex. It is cross-functional, the CEO cares about it, the CFO cares about it, the CRO cares about it, it's mathematical, it's a very packaged problem, you can present it to the board very cleanly. Like if you're looking for this like strategic thing to show that you do more strategic work than systems admin work, raise your hand and say, I want to captain alongside these other people, the comp planning process, and I want to take the lead on that. Yeah, that is great for internal exposure as well, I'd like because you talk with people across the entire organization, so if you do a good job, I think that's the requirement here, but if you do a good job, I think people will look at you differently because ultimately you touch with the office of the CEO, you talk with the individual reps, you touch with the CRO, the frontline managers, finance team, and great touch points in general. Now is the time to say is the comp plan doing what we want it to do? The thing about this rev-ops being strategic that people forget is it's not like the CEO's saying they're saying, okay, how do I get Beth to be more strategic? It's Beth's responsibility to say, is the comp plan doing what we want? It's a really good package problem today to say, is the comp plan doing what we want it to do? If not, go to your CRO, CFO, CEO and say, hey, I was doing some analysis of the comp plan. What's the point of trying to motivate this? Doesn't look like we're doing it super well. Would you be open to some ideas about how we can make some changes? Maybe talk to some teams in the market for what they're doing? Let me come back to you with some proposals. That's a really packaged project you can do really well. Yeah, I think bought reporting, comp planning, annual planning, all of these touch points where you have multiple stakeholders, C-levels, VPs, cross-functionally in a room. Once you do this regularly and whether this is reactive or proactive, you'll earn the C-level. Nobody will give it to you. You have to earn it and you have to basically deliver on things that really change the business and comp is one of those. I'm curious before we jump into some specifics on what behavioral comp can drive. Obviously, there's this whole discussion around like, quote a "taman" and then also what's the gap to the revenue goal? So typically, there's a gap. What are the typical numbers you see and what do you think are best practices there? Hey, Philip here. Are you enjoying this episode? Well, good news. Because you can find more three ReVops and go to market resources on getmeflow.com/revops. Access over 20 cheat sheets, reports and guides that will help you become a better revenue operator. Or join over 2,000 subscribers who already get the latest resources right into the inboxes without a free newsletter. Just go to getmeflow.com/revops. So the the try and true message was 80% blended like dollar a team for your revenue plan. That's what was the message for a very long time. I personally like to have a narrower gap than 80%. My thesis is I want to run the smallest, most high-performing teams possible that are rewarded for what they're doing. So I tend to like to be closer to 90% personally. Now that puts you at a little bit of risk if team members leave, you know some nutrition would have you. But my message always in that regard is you have some team members leave so you have more of an opportunity. I mean there are quarters where we as a business have had to be 100 to 120% quota attainment to hit our revenue plan. And I'm fine with that because my reps are making a lot of money they're happy. We've been as a business 100% blended quota attainment eight of the past nine quarters. And so I've been very focused on keeping teams really small. But I tend to advise like 90% gives you a little bit of coverage. I like a tighter gap because I want to keep reps engaged and happy. And I really think that you're going to start to see more orgs with smaller and smaller sales teams closing more and more revenue on a purpose and basis. I mean this is the whole promise of AI. It's how do we automate all the non-selling stuff so reps can just close more and more deals. We've seen that in our own business. We've tripled our ARR per rep over the past three years. And has been like a, it's basically been, hey, we've raised our attainment pretty dramatically. We have had an error team. And it makes the comp plan even more important because you have less people to spread the comp plan over. So you have to be very laser focused on like what your comp plans trying to get these people to do. And so that's that's like the end. And then if you think about a lot of these AI startups, they're they're talking 10 15 X quoted OT ratios where you know a rep making 200 grants, closing 3 million a year. You know, that's where you even get more compressed in the importance of your comp plan as well. Yeah. Yeah. I mean, I think obviously we're kind of with we flow on a journey to automate all non-selling activities and provide deeper insights and AI workflow orchestration. So you know, we see this across the board that is focused on less but more productive sales people. I think I would have been my next question. I mean, you know, Harry's stepping hat. I think the 11 laps CRO on the podcast talking about like I think it was like a 10 X or 20 X come to quota ratio, right? Like 2 million to like 200 K or something. I think it was 10 X. Is that something you're seeing one more? I think I think we're starting to see people try to maybe sorry, sorry to jump in but like what? You know, because they say, right, there's this world and then there's the world of rep view that has I think quota tame and trekking on 45% attainment right now or 46% right? So the majority of companies, I actually not in that 11 laps world, right? And I think that is the reality in SaaS today. But I'm just curious what you're seeing because you see so many different data points. Yeah. Yeah. We're still I think we're starting to see two things. I think we're starting to see more orgs understand that 50 to 60% blended attainment is doing nobody any favors, right? It's not it's not doing the reps any favors. It's not doing the business any favors. You're paying overhead cost for a bunch of people who are not performing. They're not happy. It's we're starting to see more businesses right size. They are team size and starts to build around the the smaller group of people who are driving the revenue for in the business and they're starting to bring into their planning, right? And I think this has just been the reaction to the Zurbere where sales team it was basically we're going to grow infinitely by dragging 80% attainment across all the sales and revenue will grow and roles will grow and revenues will grow. I'll be like never on it all. And so I think we're starting to see that we're seeing more of that correction. I think that paired with the the like superstar quoted OT numbers. I think I'm seeing more teams. Let's just get our team in a really healthy spot and let's just make sure that we're feeling good about like blended team attainment and then let's layer an AI to try to make these teams more efficient. We're on that second part of that journey like internally at quota path and the number of our customers are. But I'm also to your point still talking to some org to have 42% blended attainment. And so it's like, okay, well, let's just get the right number of people and the right people in the seats to be successful for you. Let's get some wins under the belt there and then we can layer on how do we make a per rep even more like behavior perspective. What are the key behaviors you want to drive with a comp plan? What are things that you see have the most impact on the business? This tends to be pretty business dependent, I will say. I think the first thing you know is what is the business need to do to be successful this year? I think in terms of the shape of the plan, you want a core quota with it's a peace topping rule. Two, maybe three things I tend to like to deal level mechanics that accelerate what a rep can earn on a particular deal. So you have a quota and you have accelerators for like blowing out your number, right? That's great. So you know, you want a very clear here's your quota. I typically recommend quota period be shortest time which someone can reasonably close five deals because that's like enough variance to be so if you're closing five deals, you're putting them on an annual quota. If you're closing 10, a quarter, put them on a quarterly so on and so forth. So you have a core quota and that quota has accelerators for overtainment uncapped, right? So you don't want to you don't want to cap to issues. You never want to make it so that someone doesn't have a reason to close a deal today. They should always want to close what are the accelerators. So typically we tend to see orgs, you know, zero to 100% attainment. They tend to pay one rate. Sometimes they'll pay you have to get over some sort of hurdle to earn your full rate. So like maybe zero to 50% attainment. You earn half your rate and then once you're 50% you earn your full rate typically applied retroactively like 50 one to 100%. I mix up what I don't like is cliffs. I'm not I'm not a fan of cliffs are zero to 50% you earn nothing. Because you could be at 15 percent at the end of the quarter and have a deal that gets you to 47 and a half percent. And that's a big deal for the business. But you have no incentive to close it because you're going to earn no money on it. And realistically, I think if you have a rep who's sub 50% attainment for multiple quarters, you're probably exiting them from the business. And so the comp plan shouldn't be the mechanic to exit someone from the business in my opinion. So you have like zero to 50% maybe a half rate or maybe full rate 50 to 100% their full rate as well. And then typically you would see like two maybe three accelerator bands. So like 100 to 125%. You know 125 to 150 150 plus. What you want to be careful of is you want to make those accelerating bands and you typically accelerate your rate like 20% from 100 to 125. Accelerate your rate to like 30 40% 40% for 125 to 50 and then kind of something similar on that per band. The one thing you want to make sure is those bands of acceleration have to be actually achievable. So there's nothing more demotivating to be like everybody's at 64% but if you hit 200% of your number, you're earning some crazy rate. It's like that's just insulting to your team, right? So make them bands that people at least somebody's hitting every quarter. So it's like reasonable and structured. So that's kind of the core mechanics. And then you want to have typically two deal level accelerators that tell a person this deal is better than this deal for the business. And they tend to be the things that the business really cares about. So let's say I want to move into the enterprise. You know, we've we've been at a 10k average contract value across our customers and we need to get to 25k average contract value by the end of the year. We want the same number of customers. We want them to be bigger. Cool. With that in mind, your marketing plan should accelerate for large pipeline. So like if they if they book a demo that is, you know, 50k or more, they should get extra percentage on that. If a rep closes a deal, that's 50k or more. They should get a on the deal accelerator because what people forget is that closing $150,000 deal is markedly, markedly harder than closing 10,000,000 deals, right? There's more mechanics, there's more interpolitech. There's like a lot of stuff that happens. And so you want an oversized emphasis on the value to the business of closing that one 50,000 already. So that's an example. And then maybe you give your account management team an accelerated rate for renewing larger customers. And so everybody is rowing in the same direction. Your BDRs, your marketing team, your AES, your AMs all care about closing larger deals. And that will shift the average contract value of your business up because everybody will be spending more of their energy closing these large deals. That's an example that I would say. No, no. So like, you know, like I don't have like a lot of experience for building components. Yannis has a lot more experience. So I'm just going to recap this from my perspective as a complete layman. And you know, you can just correct me if I, you know, got anything like completely wrong. So okay, so I think some core principles, right? So you basically want to tie the outcome, like do you want to tie the pay so the compensation plan basically to the strategic outcome that the business actually going for not like to activity, like that's maybe like more an SDR topic, like not to direct activity, but even that would be tight. Okay. So then you want to keep it simple. So RAP should be able to calculate their own compensation. Right. So if you basically present them the compliment, they should be able to do like lip mist test like they should be able to kind of tell it back to you. like really understand it, but it should be transparent. Then third, you should basically consider it like a dynamic thing. The core fundamentals, those should be clear, easy to understand, but then accelerators, kickers and stuff like this, you open-minded to change them, like at least on a quarterly basis. I think it's just starting out with like conversation planning monthly, it's probably not a good idea. But yeah, and okay. And then, typically, right, what do you want to do? You want to reward a mix of growth, retention, but really, if they have to make a choice, then you want to have one clear outcome. For example, your last example with the 50K deal, like, hey, you have five or five K deals or 10 K deals, you have 150K deal. You kind of want to incentive towards this 50K deal that is more strategicly important. Yeah. Those are the four summaries so far. There's the major mechanics. Ultimately, you have a board meeting, and you say, this is what we're going to do to be successful this year. And so when you've had that board meeting, you should be able to go back to each member of your team and say, this is what we told the board. We're moving to the enterprise. And here's why each of you are going to be motivated to make that move with us. EDRs are going to get more for booking enterprise deals. AE is getting more for closing enterprise deals. AM is getting more for renewing enterprise deals. This is the shift. And so you have to figure out is it larger contracts? Is it longer term? We see a lot of people think about longer term. We see, you know, like multi-year versus single-year, for example. We see a lot of people think about like testimonials. If they agree to doing a case study or testimonial, maybe you're trying to build your brand in a new market. We see a lot on products adoption. So, you know, if they buy product B or they bundle both together, we'll give you a rate. It's basically what is the thing that the business really needs? That is the narrative. So that they feel aligned to that narrative. The other thing I will say is that make your accelerator. If you're testing your ability to change behavior, way larger than you think. Right? So the fallacy that I tend to see is I earn 10% on a one-year deal and 11% on a two-year deal. Right? And basically that is not enough of a rate bump to have me overcome the objection challenge of a two-year deal versus a one-year deal. And you'll see a lot of people actually earning more on a dollar, because maybe they discount a two-year deal on average, like 20%. So I'm earning 10% more on something I'm discounting 20%. So I'm actually earning less in my pocket on a two-year deal than I am on a one-year deal. I see people run those kind of big challenges all the time. So the reason I like to narrow the number of accelerators is spite the accelerator, like, grow the rate 50%. Just to see if you can actually change the behavior and you can run these experiments. So an example is when I took over the sales team here at Quarterpath, we were primarily in one-year contracts. And it was important for us from a revenue-retentive perspective, because we spent a lot of time in implementation with our customers and it's packaged into our pricing, and so we give a lot of value up front. And so we were having margin challenges by giving a lot to customers for one-year deals where mechanics change in their business and leave us after a year. And so we said, hey, for us to be able to deliver this more durable value we need these to be into your contracts. And so my reps are out of no. People are going to be able to buy these for two-year, pushback, what have you. I said, cool, I'm going to grow your rate for a quarter. I will bump your rate 75% if you close to your deals. And all for one quarter. And I said, I went to our CEO and I said, hey, I want to do this test. Here's the budget. Here's the math of how much we're going to spend on this test if it, like, worst case cost scenario, but here's what would happen. We went the next quarter from 15% to 80% of our deals into your deals. They stopped offering one year. They didn't present it. They didn't show side by side. And now we are a two-year deal. It's a two-year contract. And so we ran that spike. And I told them, look, take a bunch of money from the business. You beat us kind of thing. Like beat the comp plan. I told them, this is a short period thing. Let's see if it can change your behavior. Run a short spike. Price it. You ran that. It totally changed the shape of the revenue for a quarter. And then we said, okay, now we're going to taper this down to a more durable cost perspective for the business. And so run these spikes to see if you can change the behavior. And if you can, then you can roll it into the core mechanics of the plan. But the worst thing to do is run an accelerator, have it not change behavior. And now you're just paying more money for the same behavior you have. No, no, I really like it. I mean, I think also, I don't know what your experience is, but I think if you communicate that to the team, hey, look, this is what we want, we're going to change the comp plan accordingly. We're going to limit this for like X, like let's say like one quarter or you have the opportunity. This is like uncapped or whatever, like whatever, like whatever, like whatever, like the setup is there. And then people know, right? And they understand, okay, like this is an opportunity for me. If I actually change my behavior, it's earn a lot more money. So, you know, am I going to tap into that opportunity or not? But I think that's sort of like how I understand you. Yeah, absolutely. Yeah, I think it's fair, right? Like you basically want to be transparent and like communicate with the sales team and really incentivize them. Because that's what it is. I have a different question, Rick Rick. So we're getting up on time. So like actually a few questions, maybe we can do like a quick fire, fire, fire answer. So, so one is, like what do you see on the SCR side? What's the typical range of like meeting booked? Like how much do they do they get? And it does depend on the mid market for the enterprise. But what's the typical rate? Yeah, so what we typically advise, I mean, from a like dollars per demo perspective, it definitely depends on like average contract value. And then ever demos, they have to build up and that's where it's stuff. In terms of the architecture, what I tend to advise is you want to have a mix of quantity and quality. I like SDRs to be on a quantity metric that's either I like demos occurring or like sales qualified demos. I tend to like demos occurring because it's the SDR job is to get them in the door in the first place and I take the demo. If you have a real quality problem, you can do that in a lot of different ways. But typically 50% of their comp on just booking the meetings to happen. And then over time, I like to shift in the 50% of their comp on actual closed door revenue. So the thought is great, you're booking demos, but the quality they have to actually end up coming to close. The problem that a lot of orgs will say is, okay, but we have a nine month sales cycle. And so what I say is, okay, do 100% on sales qualified demos or demos occurring. And then over the course of those nine months, shift it to 50, 50 as some of these demos are able to close to get them in steady state of that 50, 50 split between quantity. Okay, second question. If you have people that sell two year deals, do you pay them all up front? Or do you pay them one stay in voice? And maybe you have a building cycle of 12 months. So I tend to like paying on bookings unless you have a cash collection problem. Like, if you have a cash collection problem, you should pay on cash received. But if you don't have a cash collection problem, I would highly recommend playing on bookings. The notion is, I want you pay the rep as soon as possible for what they are delivering for the business. And so some orgs will do like 50% on closed one and 50% on first invoice paid to drive the rep to do that cash collection. It's really a question of if you have a cash collection challenge, you can use your rep as a way to like make sure that cash is coming through. But if you don't, don't just insert it for no reason, pay the rep as soon as possible so that they can like the dopamine hit of being rewarded for the book. Got it. And then customer success 50, 50, 70, 30, what's the typical thing there. So we think about the range we see is, you know, new business reps are typically 50, 50, CS post sale, the way you think about it is, the more direct impact you have on the revenue, the higher percentage should be variable. So new business reps like 50, 50, I tend to see customers as X teams, I can't manage my teams, you know, 60, 40 to 70, 30 is like the range we typically see. Sales engineering gets closer to like 70, 30 to 80, 20. And then you have a lot of like revops and other orgs, you know, 90, 10 or that kind of split. The notion here is everybody a quota path is on a variable comp plan. I think everybody should be on a variable comp plan in some way. And we actually just ran a report on revops comp plans to which we'll share with you all, which is pretty fun. Interesting ways of like how more and more revops teams are wanting to be very calm as well, which I highly agree with and think is really interesting because there are revenue driving part of the organization in the same way that a sales engineer is for example. Yeah, yeah, fully agree. I mean, I think it should be a bit like the executive pay, right? You just have a different, you know, it's like more like a company goal and you should be a center vice against that. Cool. Look, I think we could continue talking, but this was awesome. Maybe we do a little one on the rough ops salary report when it comes out. So yeah, we also fun one, but yeah, really appreciate you spending time with us before you go. We actually didn't briefly on this, but any book, research report anything you want to recommend to the audience that helps them learn and grow. So that's a really good question. I have been saying this really Recently, I've been going back to five disfunctions of Managing a Team. It is my favorite book to go back to in terms of how do I work more cross-functionally. And I think it's a really great book for RevaOps. It's all about how are you operating with positive intent? It's a parable-based book that I just really, really personally like. And it's basically all around how do you affect change in a group that has different motivation. And so it's one that I go back to pretty consistently for inspiration. It's one that I've been loving recently. Awesome. Thank you so much, Ryan. There you are having me. A lot of fun. [MUSIC PLAYING] Thank you for listening to the RevaOps Lab podcast. If you enjoyed this episode and would like to support us, share it with a RevaOps friend or Truppos of Five Star rating right now. And if you have feedback, questions, or guest ideas, just send a message to Janis or me on LinkedIn. Thank you and see you next time. (upbeat music)