Discussion Questions for Clearion Software

1. How equitable and sensible were the specific headcount and quota allocations given out by Jacoby
in January 2006? In preparing your response, please consider each of the following:

a. Which region would likely yield the most profitable investment of headcount in H1 2006:
east, west, federal, or Latin America?

b. Should the east and west regions be equally profitable (i.e., achieve the same revenues per
unit)?

c. Force-rank Jacoby, Garton, Hall, Cheng, Chapas, and Dreyer in order of their likelihood to
achieve their target, from 1 (most likely to achieve goal) to 6 (least likely to achieve goal).

2. Can Jacoby’s model for allocating headcount and quotas equitably account for realistic new hire
productivity levels and still accelerate hiring times?

3. Should quotas be based on profitability (and not revenues) if managers will be judged on their
contributions to profitability?

4. What areas, if any, of Jacoby’s model and processes for allocating headcount and quotas needed to
be adjusted?

5. Assume for the moment that Jacoby believes that his sales organization would be most efficient at
roughly the fixed ratio of one CAM to one TSM and one SE. What do you think of his new policy
of giving regional managers the power to spend units in any manner they choose? How would you
amend, if at all?

6. Jacoby received a $92 million goal from Davitian representing the Americas share of the overall
corporate goal. The case does not provide any information as to how that corporate goal was
established. Who do you think should be involved, and what processes should be employed in this
goal setting? What are the issues that a company should consider in establishing the corporate sales
goal? For each of the issues, how does this affect the various constituencies?