What compensation models are most effective for sales operations?

Salary only can work for very junior employees in their first job or under 1-2 years of experience. In other words, very low responsibility or impact on revenue. You can only keep your best talent with fair compensation. In most cases, this will include a base, a variable part, and a bonus based on company performance.

Lack of motivation is a myth. R&D in an organization is expected to do their jobs to a high degree without the need for a quota to drive motivation. SalesOps and RevOps dit closer to project management in how they operate than sales and should be comped accordingly.

Salary-only model isn't uncommon for non-managerial roles in Sales Operations for smaller companies where there isn't a Corporate Performance Plan or Bonus structure. Where there is a company-wide bonus program (typically based upon both company achievement and individual achievement), IC ops roles would benefit from having a bonus plan (incremental/ on top of salary) tied to individual goals/ objectives/ deliverables that closely align to the overall Sales/ GTM goals and objectives. For leadership roles in Ops, I think it's important to include a variable component in OTE/ TTC where leaders have a base + variable target. The variable portion can be tied to the overall targets as well where there is downside, but also upside.

Salary-only model is great for people who prioritise stability over other risk factors attached to company or other teams performances. This is more common with super entry level roles but you might also see seniors who opt-out of a bonus structure to favour higher base salaries. This should not be mistaken for lack of motivation as this is not necessarily tied to compensation.

Salary-only models work well for Revenue Operations. They give the necessary freedom to improve operations and drive E2E operational excellence, while not focusing on short-term success only. Since Sales Ops usually cannot drive the direct outcome of specific deals, this is a favorable model, at least compared to commission + salary models.

This is not common. Putting non-customer facing, non-persuasive roles on a commission plan is generally misaligned from best practice. But I personally have been on a plan like this as a RevOps leader and loved it. There is value to aligning RevOps plans closely with the revenue organization's goals & (often) incentive / commission model. Personally, I think a lot of the more "objective based" items that often make it into a SalesOps plan can be driven via mgmt & development planning. In any case, I would not suggest putting a SalesOps person on a plan that was more aggressive than, say, 70% base 30% incentive.

Salary plus commission models are the most standard we see for sales reps, typically in a 50/50 split for new logo sellers and 65/35 for team members focused on account expansion and retention. The challenge with a salary-plus-commission model is making sure that the commission is aligned to actions that are good for the business. Ultimately you want a comp plan that rewards the reps for doing things that are great for the business in the long term - selling to ideal customers, signing longer term contracts, etc.

It's nice to appreciate how SalesOps and RevOps contribute to the revenue gain in the company. However product and engineering play just as large a role, if not more so, and we don't comp them with a variable. I think revenue/profit sharing for the organization is important but variable based como on quota is outdated. Especially for Ops roles.

With account executives and business development representatives, I’d expect a 50% base to be from salary. The other 50% or more should be variable commissions to get On Target Earnings. I’d recommend looking at Repvue.com to understand the numbers and how much of the team is actually hitting quota. With sales operations, I’d expect a higher base, with much less variable. I’d still expect some bonus if the revenue team hits or exceeds quota at the end of the year.

Sales reps will almost always have a variable component to their plan. In fact, I would say always. :-) But for Sales Operations, having an OTE/ TTC with a variable component carved out (vs. incremental) is more rare for non-manager roles. Most IC roles will have a bonus component (on top of base) tied to specific goals/ objectives (MBOs). For manager and above roles, I think it's important to have a variable component tied to the total sales/ revenue number to ensure alignment, have "skin in the game", but also be rewarded for overachievement when the organization performs well.

No sales / revops person would ever take a commission only ops job. I've never seen it either. And for that reason, I am out.

I'm old, but I've seen this. I even had this once. It is far too stressful for most organizations. If you are dealing with a highly predictable sales cycle and lead sources, then maybe. But still probably a bad idea.

I've never seen commission-only model in sales/ revenue operations and don't think anyone would apply for a job like this. I assume this section mixes up sales with sales/ revenue operations as it does exists for sales in specific industries.

Although this is common for Sales roles, I have never seen this in practice for any Operations roles. Because Sales reps have more of a direct influence/ impact on their own revenue number, it makes sense for reps. However, Ops has a less direct 1:1 impact on revenue, and therefore, I would argue against having this type of compensation structure for Ops. When thinking about variable compensation, it's best practice to think about what you want the individual to achieve - and what they can be held accountable for - and what they can actually impact.

This is most typical in my experience. Sales / RevOps people are usually on a fairly conservative plan (e.g., 80% base, 20% incentive/bonus). The bonus most-often consists of a number of MBOs / KPIs that are established at the company level and/or by reporting manager / team leader. Most often, there will be a combination of quarterly and annual objectives. MBO / KPI plans should include metrics that (as much as possible) are objective, trackable, and can have targets set. But this is rarely the reality....plans end up with a lot of "fluff" more often than they should where goals are subjective or targets are ill-defined.

Most common model out there ad what I would consider best practice, with a mix of the "salary-only" model. Here you get the stability element ops people are usually after + an incentive based on macro factors across teams and company's performance. This allows for further alignment across company's vision and goals, paving the way for potential increased performance.

This is a common model in my experience (some prefer salary-only). Typically, the OTE is around 80/20 split (base/bonus), not the typical 50/50/25+ that AEs are used to. While there are different approaches to how a bonus is structured, it often follows the logic of MBOs/ OKRs/ KPIs. This often combines: - company metrics - team goals - project/ individual goals In my experience, making objectives trackable can be a challenge and ensuring a seamless quarterly planning process can take a lot of time that could be invested in actually getting work done.

This is a very typical model, as it combines both incentives to also work on longer-term projects (fixed salary), and motivation to support the overall success of the company (bonus).

Similar to what I mentioned in another section of this article, where there is a company-wide bonus program (typically based upon both company achievement and individual achievement), IC ops roles would benefit from having a bonus plan (incremental/ on top of salary) tied to individual goals/ objectives/ deliverables that closely align to the overall Sales/ GTM goals and objectives. For leadership roles in Ops, I think it's important to include a variable component in OTE/ TTC where leaders have a base + variable target. The variable portion can be tied to the overall targets as well where there is downside, but also upside.

There are exceptional circumstances where sales compensation should reflect value in a way that doesn't directly correlate to revenue or profitability. Like when early sales are worth even more to a company because of valuations and fundraising rounds. In cases like these, compensation and deal size may not be directly correlated.

To choose the right model you can look at A) responsibility B) impact on revenue Two examples. 1. CRM admin Will have limited responsibility and a low impact on revenue. Here you are good with a base compensation and a end of year bonus based on company performance 2. Senior Enablement specialist Has medium responsibility and high impact on revenue (better enablement more revenue). Here you want to have a base, variable and bonus based on performance.

Each of the models listed are viable options for motivating sales operations professionals. The trick is to use different compensation models to encourage different types of engagement while also aligning with their primary responsibilities. For example: IF sales operations is primarily responsible for list-building/call prioritization and the organization is in hyper-growth mode, paying salary + commission makes sense. However, if sales operations is assisting with renewals and predicting churn and the main company goal is client retention, than salary + bonus tied to retention rates YoY makes more sense. Whatever goal the professional is facing should (1) be aligned with the companies goals and (2) the professionals regular tasks.

More and more, I see senior leaders in Operations having a variable compensation plan aligned with the CRO (for true RevOps), CMO (for MarketingOps) or CSO (for SalesOps) which I think is important to ensure that true business partner/ thought leader relationship where you are truly side-by-side in working towards the same outcomes. If you are an Ops executive, I would encourage you to push for a variable comp plan that closely aligns you with your leader to foster that partnership and the perspective that you are truly that business partner.

This article detailed sales team comp specifically, but I believe that every position at a company should be variably compensated in some way. Especially at earlier-stage startups, having every employee tied to revenue growth financially makes everyone aware of the focus of the business and aligned to its success.