Group 2

Aditya Jindal
Aditya Jha
Antra Chawla
Rashi Vaani
Rajat Surve
Q1. Analyze the performance of the regions for the H2, 2005. What do
you think are the issues in the various regions?

West Federal Union East

• Exceeded the quota by
average of 30% from past
three performance periods
• Most of overall revenue, 40
million
• Most efficient use of
resources
• Usually pipeline filled with
quick and numble high-
technology enterprise
• Missed quota by 19%
• Clients mostly consist of slow
moving federal government
• Beneficial in long term
• Tripled the size of her
organization in previous
three months
• Missed quota by 15%
• Generated $30000 less
revenues less per unit than
west region
• Client consist of quick and
numble high-tech enterprise.

Issues Issues Issues

• Vast consumption of
resources
• Longer to fill openings
• • Sandbagging, lobbying and
Longer sales cycle
• Excessive hiring gaming more than any other
region
 Q2. What are the differences between Jacoby’s new model and the old
model of assigning targets and resources? Is the new system better or
worse than the old? Why?
Old model New model
• Quota setting was subjective, simple and • Conversion of headcount to units was simple to
dependent on Jacoby’s assessment of the understand, showed current consumption,
situation . productivity (contribution/unit).

• Jacoby had no way to assess his own performance • Focus was more on profitability by measuring revenue
of quota setting. per unit

• Problem of Sandbagging, lobbying and gaming • Made managers accountable for shared SE and TSM

• No forecasting for headcount, all the allocation • Each CAM was given twice the weightage as compare
was done on ad-hoc basis to SE and TSM

• Revenue was the main focus rather than • New hires had same productivity as existing
profitability headcount

• Hoarding of SEs and TSMs by managers, uneven

resource sharing, no penalty for excessive use
Q3. How equitable and sensible were the specific headcount and quota
allocations given out by Jacoby in January 2006?

Jacoby’s headcount and quota allocations were not equitable and sensible because:

• There has to be a study of the territories and proper determination of the areas that have the
best opportunity to succeed
• There should be Logical quota based on research and fact (geography, historical achievement,
market research, competitors’ actual sales, etc.)
• Create culture of discipline to drive consistent behavior year- round
• Understand that everyone has different levels of drive, ambition, motivation
Q 4 : Which region would likely yield the most profitable investment of
headcount in H1 2006: east, west, federal, or Latin America?
Year East West Latin America Federal
Quota H2 2005 (Rev in $ mn) 32 39.6 2.5 7
Quota H1 2006 ( Rev in $ mn) 38.2 45.1 2.8 6.3
% shortfall or surplus in 2005 -15% 20% -10% -19%
% Growth Quota 19% 14% 14% -10%
Headcount H2 2005 200 214 19 64
Headcount H1 2006 220 242 24 72
% headcount growth 10% 13% 27% 13%

Revenues/unit
Region 2005 Achieved 2006 Targets
West 0.19 0.19
East 0.16 0.17
Latin America 0.13 0.12
Federal 0.11 0.09
Q 4 ( continued ) : Which region would likely yield the most profitable investment of
headcount in H1 2006: east, west, federal, or Latin America?

East West Latin America Federal

 Generated the most
In spite of East not Had smallest shortfall Quota reduced by 10% and
revenues/unit and overall
achieving 2005 targets, among all the 3 regions. headcount increased by 13%
revenue in second half of
highest quota increment and Jacoby expected long term
2005  Highest percentage
lowest headcount increment benefit from this region
 Exceeded quota by 30% for
headcount increase,
Allocations comparable to the last 3 performance
though least in terms of Sales force tripled in the
periods
West region H2 2005 actual numbers last 24 months still it did not
 Allocated 28 new
headcounts which is a achieve quota
Expectations that Mid Comparable quota increase
manageable 13%.
Atlantic region will perform
 Utilized the maximum
well
shared resources in 2005
and had a high headcount
which was utilized more
efficiently than competitors

Thus , West region is likely to yield the most profitable investment of headcount
6
 Q5.What areas, if any, of Jacoby’s model and processes for
allocating headcount and quotas needed to be adjusted?

• Unit for the Corporate account manager(CAM) should be increased to more than 2units to avoid hiring only
CAMs

• Sales budget to be considered to reduce the cost instead of unit method

• For the federal region , since the sales cycle is long there should be different model for quota setting

• New hire performance should be measured in a different productivity rate as they are not at the same level as
an experienced employees

• Aggressive Unitization was not in line the profitability and efficiency

Example : although there was a dip in the target for Federal region, the headcount was increased
Q6.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?
• SVP and VP should make sure that corporate goal aligns with the overall financial goals of the company.

• Fool proof sales forecasting system should be introduced to avoid sandbagging, lobbying, gaming etc.

• Top-down approach of goal setting based on ambition should be balanced with ground business realities
to arrive at final corporate goals.

Issues Affects
Market Condition Market condition affects the sales
number and sales forecasts which in turn
affects goals
Establishing goal parameters Better sales forecasting, describes
approach
Hiring cycle should start before the goal Better sales force management
setting