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Quota Setting Methodologies
Territory Programs can be configured to use one of the two types of quota setting methodologies: Top-Down, or Bottom-Up. Once you set the quota methodology for a new Territory Program, it cannot be changed.
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The Top-Down quota setting methodology starts with a defined quota at the top-level territory, which is, the root territory in the territory program. The quota is then gradually divided and distributed to the lower-level territories. This process repeats until the quotas are assigned to individual sales representatives. The methodology can be iterative when quotas are assigned to a given tier and quota change requests flow back up the hierarchy. When the change request is processed, the adjusted quotas are redistributed.
Using this methodology, you can utilize the system-recommended proportional quota distribution feature which evaluates historical sales and CRM Opportunity data. The recommendations are generated on the relative valuation of the territories, based on one or more of the following:
While utilizing the system recommendations, you can manually adjust and rebalance the quotas prior to the final distribution based on your business needs.
Top-Down Bulk Weighted Fair Share Calculation
The administrator can run a weighted fair share calculation for the entire Top down territory program that pre-populates the quotas for each territory based on history, pipeline, or even spreads.
The Sales Manager or administrator can run a weighted fair share calculation at a Top down territory level only, with the option to cascade the calculations down to children that pre-populates the quotas for each territory based on history, pipeline, or even spreads.
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The bottom-up methodology utilizes a quota calculation method to determine initial quota values. We start at the leaf-level of the territory hierarchy and aggregate or “roll up” sub-territory quotas to determine the parent territory quotas.
To determine the initial quota for a given territory, Historical sales data is used as a baseline to which a growth target and attrition relief can be applied. Once generated, you can fine-tune the quotas, assign them to sales representatives, and then submit them to the higher territory levels for review and approval.
Similar to the top-down method, you can rebalance and recalculate the quotas for individual territories and then resubmit and reassign them.
The bottom-up methodology is particularly effective for organizations that set quota values based on growth over a prior period.