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4 Manage Sales Quotas

This chapter contains the following:

Sales Quota Management: Overview

Sales Quota Plan Components: How They Work Together

Sales Goals: Explained

Territory Quota Formulas: Explained

Published Quotas: Explained

Resource Quota and Incentive Compensation: How They Work Together

Sales Quotas Import: Overview

Territory Quota Import File Reference

Territory Period Quota Import File Reference

Resource Quota Import File Reference

Resource Period Quota Import File Reference

FAQs for Manage Sales Quotas

Sales Quota Management: Overview

Sales Quota Management provides a comprehensive solution for managing sales quotas to maximize quota attainment and improve overall sales performance. Effective top-down planning with bottom-up assessments ensures that quotas relate to corporate goals. The full integration with territory management and incentive compensation enables end-to-end sales performance management processes. After the sales plan is deployed for the year, sales executives can then monitor and track sales performance by comparing forecasts with actuals and with quotas.

Summary of Features

The key features of Quota Management include the following:

  • Assign territory quotas to territories and resource quotas to people.

  • Align multiple resource quotas to different sales goals. For example, create sales goals for hardware revenue and for number of sales calls.

  • Review quotas assigned to you by your senior manager and allocate quotas to your salespeople.

  • Use formulas to calculate territory quotas using measurements of historical data and future potential.

  • Add adjustments to a quota before distributing it.

  • Track current quota achievement compared with quota targets.

  • Manage seasonal variations in sales by distributing the revenue quota among several calendar periods using seasonality guidance.

  • Send notification to Incentive Compensation with new and changed individual quota assignments for all sales goals.

Sales Quota Plan Components: How They Work Together

Quotas are a reflection of sales targets set for an individual in a sales organization. After a corporate goal is established, managers distribute quotas down through the sales territory hierarchy until all territories and their respective owners have quotas. Quota predictions based on historical sales information and metrics are provided as a comparison with quotas being set. Managers use one sales quota plan for the fiscal year.

In this figure, a sales quota plan contains several territories, each assigned a quota. Territory quota formulas compute predicted quotas based on historical sales information and metrics such as forecasts and market potential. The predicted quotas appear as default territory quota amounts. Managers assign territories to individual salespeople and sales managers. Applying spread formulas quickly allocates quotas among territories or resources.

Sales Quota Plan Components

Sales Quota Plan

A sales quota plan covers a period of one year. The administrator selects territories to include in the quota setting process, and can optionally add territory proposals to allow the setting of quotas for proposed territories.

For the sales quota plan options, the administrator selects an adjustment threshold, a territory quota formula, and a seasonality factor group to apply to all territories. Territory options override sales quota plan options. For example, the territory quota formulas and seasonality factor groups selected for individual territories override the formulas selected for all territories.

The administrator can also set a threshold percentage for adjustment amounts that managers often add to quotas.

In this figure, the assigned quota gets distributed over each month through seasonality factors that raise or lower quota amounts according to seasonal fluctuations.

Seasonality Factors Applied to Quotas

Territory Proposals

You can associate territory proposals to your sales quota plan. When sales administrators or sales managers create new proposed territories, such as for a territory realignment, they can enable the setting of quotas for the proposed territories by selecting Eligible for Quota. If you then associate the proposals to your quota plan, you see the proposed territories within the current active territory hierarchy, and salespeople will be able to assign quotas to the proposed territories.

Sales Goals: Explained

A sales goal determines how quota is measured and defines what you want to measure. Commonly used sales quotas are simply salesperson targets for revenue achievement in their respective territories. Such sales quotas are modeled as Sales Revenue Goals. This goal is automatically assigned to every territory owner during the annual quota planning process. Create additional sales goals, such as sales volume or number of customer visits, if you want to assign other quotas to your salespeople.

This figure shows the components of a sales goal. A sales goal supports a particular objective. You can use any unit of measure for your sales goal and specify what to measure, for example, number of sales calls. The provided unit of measure choices are amount and quantity, but you can also define your own unit of measure. Each sales goal contains only one measure. You can also focus the sales goal on one or more product groups. For example, the Hardware Goal is defined as the sales revenue amount for the hardware product group.

Components of a Sales Goal

Note

The unit of measure cannot be changed after the administrator creates the sales goal.

With extensibility, you can set up other focus areas, such as accounts or sales accounts.

Multiple Quotas for One Resource

You must create multiple sales goals if you want to assign multiple quotas to one resource.

This figure shows multiple quotas assigned to a salesperson within the current active quota plan year. The salesperson owns a territory and therefore has a Revenue Goal quota plus the two quotas manually assigned by the salesperson's manager.

Salesperson with three quotas

Note

A resource can have only one quota per sales goal for the year. You can assign new quotas only for active sales goals. Inactivating a sales goal does not affect existing quotas for that sales goal.

When you submit notifications to compensation, quotas for all sales goals for the resource are included in the notification.

Territory Quota Formulas: Explained

Territory quota formulas calculate territory quota based on historical sales information and metrics such as forecasts and market potential. The calculated quotas appear as default territory quota amounts in the sales quota plan.

The formulas execute a Multidimensional Expressions (MDX) query on the territories Oracle Essbase hypercube.

Administrators can change parameters for formulas and set each formula to active or inactive.

Predefined Formulas

Following are explanations for a few of the predefined territory quota formulas.

  • Scale a measure from a past period by a percentage

    Total the amounts for a selected measure for the past selected year. Calculate the stated percentage of the total and add it to the total.

    For example, 110 percent of closed bookings for fiscal year 2009.

  • Percentage change in a measure value over 2 consecutive periods

    Subtract the total amounts for a selected measure for one year from the total amounts for the subsequent year. Divide the difference by the total of the first year to determine the percentage of change. Calculate the percentage of the total value of the second year and add the result to the year's total.

    For example, closed bookings for 2009 minus closed bookings for 2008 divided by 2008 total gives the rate of change as 8 percent. Calculated quotas are 108 percent of the 2009 closed bookings.

  • Percentage change in a measure value over 2 named time periods (current and past)

    Subtract the total amounts for a selected measure for a selected year from the total amounts for the current year. Divide the difference by the total of the earlier year to determine the percentage of change. Calculate the percentage of the total value of the current year and add the result to the year's total.

    For example, closed bookings for 2010 minus closed bookings for 2007 divided by 2007 total gives the rate of change as 7 percent. Calculated quotas are 107 percent of the 2007 closed bookings.

Creating Formulas

Use the Essbase MDX Script Editor to create your own territory quota formulas.

For more information on MDX functions, see Oracle Essbase Technical Reference.

For more information on MDX queries, see Oracle Essbase Database Administrator's Guide.

Published Quotas: Explained

When sales managers complete assigning quotas, they publish the quotas to the owners and resources of their child territories. The child territory owners can then view their quotas for the territories they own, and in turn assign and publish quotas to the owners and resources of their child territories. Publishing your quotas also sends notifications containing resource quota information to an incentive compensation analyst. The territory owner whose quotas are now published and the manager of the sales manager who publishes the quota receive notifications that the quotas are published.

You can select one or more territories to publish. When you publish a territory, you publish:

  • The territory quota

  • The resource quotas for all sales goals for the selected territory

  • The quotas assigned to finer time periods

Quotas in the published status cannot be changed or published again without first changing the status to pending revision. Activating a territory proposal that affects quotas will change the status to pending revision. You can use Revise in the Action menu to change the status of a selected territory to Pending Revision, if you have the permission to do so.

If you did not apply seasonality to quotas, then the publishing process applies the seasonality factor that was defined in the sales quota plan for the territory. If there are no seasonality factor groups defined, then seasonality factors are not applied and there is no granular time period quota.

Excluded territories cannot be published. Publishing fails if the selected territory or any territory resource has no quota.

Resource Quota and Incentive Compensation: How They Work Together

Compensation plans control how an employee is paid. Salespeople often get paid according to their performance. One tool used to measure performance is the establishment of a sales quota for the salesperson and then the comparison of actual sales for a time period with the salesperson's quota for that time period. The system notifies the compensation analyst any time quota is published or changed.

This figure shows the sales manager publishing territory resource quotas. The publication sends a notification to the incentive compensation analyst.

Quota notification to compensation

Managing Quotas

At the beginning of the year, sales management updates their territory definitions and assigns salespeople to territories. Senior managers assign quotas to their territories and child territories. The owners of those territories in turn assign quotas to the owners and resources of their child territories. When a manager publishes quotas, the quotas become available to the owners of the child territories. Also, a notification goes to the compensation analyst with the now published quota information.

During a quota plan period, changes occur in territory definitions, resource assignment to territories, and to quota assignments to resources (salespeople). Managers can choose to submit updated quota information to the compensation analyst in the form of a notification.

Sales Goals

A sales goal determines how quota is measured and defines what you want to measure. The sales goal used for territory owner's revenue quotas is the Revenue Sales Goal. In order to assign multiple quotas to an individual salesperson or to assign quotas to salespeople other than territory owners, you must use a sales goal other than the Revenue Sales Goal. Examples of sales goal definitions include number of customer visits, number of service contracts sold, and revenue for the hardware product group.

Notifications to compensation include quotas for each quota-carrying resource for all sales goals. For each salesperson, the notification contains all the annual resource quotas for all applicable goals as well as the period quotas.

Updating Compensation Plans

The compensation analyst creates compensation plans for a specific time period. The analyst uses quota notifications to keep the quota information in the plan correct and up to date. The analyst analyzes the provided information, performs any other research needed, and manually updates the quota plan or rejects the notification. The compensation plan quota status is set to complete when the compensation analyst completes updating the compensation plan.

Sales Quotas Import: Overview

Within a selected quota plan in Manage Sales Quotas, you can select a territory hierarchy within your control and import resource quotas and territory quotas from a spreadsheet. During the quota planning cycle, sales operations users consolidate quota information for the territories that they support into the spreadsheet and import the new quota allocations.

The data is imported only to quota plans that are active and being tracked.

Territory quotas, territory period quotas, resource quotas, and resource period quotas are imported using the following four CSV files:

  • Territory_Quota.csv

    The file includes the territory name, parent territory, and territory quota.

  • Territory_Period_Quota.csv

    The file includes the quota by period (for example, month) for each territory quota.

  • Resource_Quota.csv

    The file contains the resource quota per sales goal, and related compensation plan notification status.

  • Resource_Period_Quota.csv

    The file includes the quota by period (for example, month) for each resource quota.

Import is available from the Actions list for the territory quota table in Manage Sales Quotas.

Territory Quota Import File Reference

Within a selected quota plan in Manage Sales Quotas, you can select a territory hierarchy within your control and import resource quotas and territory quotas from a spreadsheet. In the spreadsheet, you can allocate quotas and import your new quota allocations to the active quota plans that are being tracked. During the quota planning cycle, sales operations users consolidate quota information for the territories that they support into the spreadsheet and import the new quota allocations. This topic describes the spreadsheet and corresponding table columns for the Territory_Quota.csv file

Import uses a zip file that contains the following four CSV files:

  • Territory_Quota

  • Territory_Period_Quota

  • Resource_Quota

  • Resource_Period_Quota

Territory_Quota.csv File

The following table lists the columns included in the Territory Quota file along with descriptions. Territory Quota and Allocation Comments fields will be updated from the file. The rest of the required fields are used for validation.


Import Sheet Name

Description

QuotaPlanName

The sales quota plan containing the territory quota. Unique user key. Required column.

ParentTerritoryName

The name of the parent territory for the territory that is assigned the quota.

TerritoryNumber

External territory identifier. Unique user key. Required column.

TerritoryName

Name of the territory.

StartDate

The start date of the quota period in MM/DD/YY date format.

EndDate

The end date of the quota period in MM/DD/YY date format.

TerritoryQuota

Quota assigned to this territory.

Currency

CRM corporate currency

Status

Status of this territory quota: PUBLISHED, NON-PUBLISHED, or PENDING REVISION.

PublishedDate

Date territory quota is published, in MM/DD/YY date format.

AllocationComments

Allocation comments for the quota.

Territory Period Quota Import File Reference

Within a selected quota plan in Manage Sales Quotas, you can select a territory hierarchy within your control and import resource quotas and territory quotas from a spreadsheet. In the spreadsheet, you can allocate quotas and import your new quota allocations to active quota plans that are being tracked. During the quota planning cycle, sales operations users consolidate quota information for the territories that they support into the spreadsheet and import the new quota allocations. This topic describes the spreadsheet and corresponding table columns for the Territory_Period_Quota.csv file

Import uses a zip file that contains the following four CSV files:

  • Territory_Quota

  • Territory_Period_Quota

  • Resource_Quota

  • Resource_Period_Quota

Territory_Period_Quota.csv File

The following table lists the columns included in the Territory Period Quotafile along with descriptions. The Territory Period Quota field will be updated from the file. The rest of the required fields are used for validation.


Import Sheet Name

Description

QuotaPlanName

The sales quota plan containing the territory quota. Unique user key. Required column.

ParentTerritoryName

The name of the parent territory for the territory that is assigned the quota.

TerritoryNumber

External territory identifier. Unique user key. Required column.

TerritoryName

Name of the territory.

PeriodName

Name of the period from GL_PERIODS. Unique user key. Required column.

StartDate

The start date of the quota period.

EndDate

The end date of the quota period.

TerritoryPeriodQuota

Quota assigned to specific period.

Resource Quota Import File Reference

Within a selected quota plan in Manage Sales Quotas, you can select a territory hierarchy within your control and import resource quotas and territory quotas from a spreadsheet. In the spreadsheet, you can allocate quotas and import your new quota allocations to active quota plans that are being tracked. During the quota planning cycle, sales operations users consolidate quota information for the territories that they support into the spreadsheet and import the new quota allocations. This topic describes the spreadsheet and corresponding table columns for the Resource_Quota.csv file

Import uses a zip file that contains the following four CSV files:

  • Territory_Quota

  • Territory_Period_Quota

  • Resource_Quota

  • Resource_Period_Quota

Resource_Quota.csv File

The following table lists the columns included in the Resource Quota file along with descriptions. Resource Quota and Allocation Comments fields will be updated from the file. The rest of the required fields are used for validation.


Import Sheet Name

Description

Action

Action Code: Allowed values are INSERT, UPDATE, and DELETE.

QuotaPlanName

The sales quota plan containing the territory quota. Unique user key. Required column.

ParentTerritoryName

The name of the parent territory for the territory that is assigned the quota.

TerritoryNumber

External territory identifier. Unique user key. Required column.

TerritoryName

Name of the territory.

ResourceName

Salesperson's name.

ResourceEmail

Salesperson's e-mail address. Unique user key. Required column.

GoalNumber

Sales goal number. Unique user key. Required column.

GoalName

Sales goal assigned to resource quota.

Currency

CRM corporate currency.

ResourceQuota

Quota assigned to salesperson and associated with specific sales goal.

UnitOfMeasure

Resource quota UOM: Quantity or Amount.

StartDate

Resource quota start date.

EndDate

Resource quota end date.

AllocationComments

Comments about the resource quota allocation.

CompensationPlanStatus

The status of quota being incorporated into the salesperson's compensation plan.

CompensationPlanSubmittedDate

The date that the quota was submitted to the compensation analyst in order for the compensation plan to be updated.

Resource Period Quota Import File Reference

Within a selected quota plan in Manage Sales Quotas, you can select a territory hierarchy within your control and import resource quotas and territory quotas from a spreadsheet. In the spreadsheet, you can allocate quotas and import your new quota allocations to active quota plans that are being tracked. During the quota planning cycle, sales operations users consolidate quota information for the territories that they support into the spreadsheet and import the new quota allocations. This topic describes the spreadsheet and corresponding table columns for the Resource_Period_Quota.csv file

Import uses a zip file that contains the following four CSV files:

  • Territory_Quota

  • Territory_Period_Quota

  • Resource_Quota

  • Resource_Period_Quota

Resource_Period_Quota.csv File

The following table lists the columns included in the Resource Period Quota file along with descriptions. The Resource Period Quota field will be updated from the file. The rest of the required fields are used for validation.


Import Sheet Name

Description

QuotaPlanName

The sales quota plan containing the resource quota. Unique user key. Required field.

ParentTerritoryName

The name of the parent territory for the territory that is assigned the quota.

TerritoryNumber

External territory identifier. Unique user key. Required field.

TerritoryName

Name of the territory.

ResourceName

Salesperson's name.

ResourceEmail

Salesperson's e-mail address. Mandatory attribute and acts as a Unique User Key. Required field.

GoalNumber

Sales goal number. Unique user key. Required field.

GoalName

Sales goal assigned to resource quota.

PeriodName

Name of the period from GL_PERIODS. Unique user key. Required field.

StartDate

Start date of the period.

EndDate

End date of the period.

ResourcePeriodQuota

Resource Quota assigned to specific period.

UnitOfMeasure

Resource quota UOM: Quantity or Amount.

Currency

CRM corporate currency.

AllocationComments

Comments about the resource quota allocation.

FAQs for Manage Sales Quotas

What's a variance?

The variance is the difference between the adjusted quota amount for the parent territory and the rolled up total amount from the child territory quotas. The variance can be spread, meaning it gets added to the child territories.

What's seasonality?

Annual quotas are distributed to shorter time periods, factoring in seasonal expectations in sales. This expectation is represented as a percentage factor, which reflects the share of quota for the season, or time period.

For example, your sales are typically higher the last quarter of the year and at their lowest the first quarter of the year for several of your product lines. You create the following seasonality factor group, named Retail, to automatically distribute your annual quota and factor in the seasons:

  • 10 percent for the first quarter

  • 25 percent for the second quarter

  • 25 percent for the third quarter

  • 40 percent for the fourth quarter

When you assign quota to territories that include these product lines, you apply the Retail seasonality group to correctly distribute the annual quota amounts.

What's an adjustment?

An adjustment is the amount that territory owners, or a sales managers who have child territories, add to the territory quota assigned to the territory they own. The territory owner can then allocate the adjusted territory quota to child territories.

What's a spread formula?

A spread formula calculates the distribution of an amount among selected child territories. For example, a spread formula takes the variance between the parent territory quota and the sum of the quotas for the child territories, and spreads it to the child territories.

The formula calculates the ratios to use for the child territories through the use of the metric defined for the selected spread formula. The formula examines each territory contribution of the metric value for a period, and compares it with the total value of the same metric for all the territories combined, to determine the percentage to apply to each territory. When a spread formula has no metric selected, then it distributes the amount evenly across the child territories.

What's the difference between territory and resource quota start and end dates?

Territory quota start date and end date define a period within which the sales quota target needs to be achieved. The territory quota dates must fall within the start and end dates of the quota plan, and usually match the sales quota plan start and end dates, unless a territory is created after the start of a sales quota plan or deleted during the course of a sales quota plan.

The resource quota start and end date defines a period within which the quota needs to be achieved by the salesperson, and usually match the sales quota plan start and end dates.

Resource dates vary from the sales quota plan start and end dates when:

  • A territory is deleted. All resource quotas within the territory have the same end date as the territory end date. The sales quota plan end date is not yet reached.

  • A territory resource is removed from a territory, and the resource is end dated.

  • Quota is assigned to a future dated resource who will join the organization in future.

When do I exclude a territory from quota?

Quota is typically assigned based on revenue amounts from prime territories. When you have territories used as placeholders or for overlay purposes, these types are typically excluded from quota.

What's a territory administrator?

Sales managers often choose a salesperson or other employee to assist with the quota setting process. They designate this person as a territory team member and as a territory administrator. Administrators have the same ability to assign quotas as the owner of the territory.