Afrexai Sales Compensation

# Sales Compensation Plan Designer

Design, audit, and optimize sales compensation structures that actually drive the behavior you want. Covers quota setting, OTE splits, accelerators, clawbacks, SPIFs, and multi-role plan architectures.

## When to Use
- Designing comp plans for new sales roles (AE, SDR, CSM, SE, Channel)
- Auditing existing plans for misaligned incentives
- Modeling plan costs and quota coverage ratios
- Building accelerator/decelerator curves
- Comparing comp structures across industry benchmarks

## Compensation Plan Framework

### Step 1: Role Classification
Classify the role before designing comp:

| Role Type | Typical OTE | Base/Variable Split | Quota Multiple |
|-----------|-------------|--------------------:|----------------|
| SDR/BDR | $65K-$90K | 70/30 | 3-5x variable |
| AE (SMB) | $100K-$140K | 50/50 | 4-6x OTE |
| AE (Mid-Market) | $150K-$200K | 50/50 | 4-5x OTE |
| AE (Enterprise) | $200K-$300K+ | 60/40 | 3-4x OTE |
| CSM/AM | $90K-$130K | 65/35 | 4-6x variable |
| Sales Engineer | $130K-$180K | 70/30 | Team-based |
| VP Sales | $250K-$400K+ | 55/45 | 2-3x OTE |
| Channel/Partner | $120K-$160K | 60/40 | 3-5x variable |

### Step 2: Quota Setting Methodology
Use bottom-up capacity model:

1. **TAM Analysis** — addressable market in territory
2. **Historical Performance** — trailing 4-quarter attainment distribution
3. **Ramp Adjustment** — new hires at 25/50/75/100% quota months 1-4
4. **Coverage Ratio** — pipeline-to-quota (3x minimum for new business, 2x for expansion)
5. **Quota:OTE Ratio** — should be 4-6x. Below 3x = overpaying. Above 8x = nobody hits it.

Red flags in quota setting:
- Top-down only (board target ÷ headcount)
- Same quota for all territories regardless of TAM
- No ramp period for new hires
- Changing quotas mid-quarter
- More than 60% of reps missing quota (plan problem, not people problem)

### Step 3: Variable Compensation Design

**Base Structure:**
```
Monthly Variable = (Attainment % × Quota × Commission Ra...

# Sales Compensation Plan Designer

Design, audit, and optimize sales comp plans that drive the right behavior. Covers AE, SDR, CSM, SE, Channel, and VP-level plan architectures with 2026 benchmarks.

## What's Inside

- **Role-specific OTE and split benchmarks** across 10 industries
- **Quota setting methodology** — bottom-up capacity model, not top-down guesswork
- **Accelerator/decelerator curve templates** with rate multipliers
- **Plan cost modeling** — bear/base/bull scenarios before you launch
- **10-point annual audit checklist** with scoring interpretation
- **SPIF design framework** for short-term behavioral nudges
- **Clawback provisions** — standard terms that protect without alienating
- **AI-era adjustments** — how AI agents change SDR comp, ramp times, and quotas

## Who It's For

- Revenue leaders designing or overhauling comp plans
- Sales ops teams modeling plan costs and coverage ratios
- Founders setting up their first sales comp structure
- CFOs auditing sales efficiency and CAC payback

## Quick Start

Tell your agent: *"Review our current sales comp plan using the sales compensation skill"*

Or: *"Design a comp plan for a mid-market AE role with $180K OTE"*

## 2026 Industry Benchmarks Included

SaaS, Fintech, Healthcare IT, Cybersecurity, AI/ML, Legal Tech, Construction Tech, Manufacturing, Professional Services, Real Estate Tech.

---

**Get your full industry AI strategy pack →** [afrexai-cto.github.io/context-packs](https://afrexai-cto.github.io/context-packs/) ($47/pack)

**Calculate your AI revenue leak →** [afrexai-cto.github.io/ai-revenue-calculator](https://afrexai-cto.github.io/ai-revenue-calculator/)

**Configure your AI agent workforce →** [afrexai-cto.github.io/agent-setup](https://afrexai-cto.github.io/agent-setup/)

Built by [AfrexAI](https://afrexai-cto.github.io/context-packs/) 🖤💛