Episode 60: Pay Day Problems: Comp Plan Lessons Learned

In this episode of the RevOpsAF podcast, co-host Camela Thompson sits down with George Erskine, Founder of Candescent Strategies and a 15-year veteran of revenue operations. From Adobe to SolarCity to advising high-growth SaaS startups, George has seen comp plans that motivate record-breaking performance—and ones that drive reps straight out the door.

The conversation is a candid look at the high-stakes world of sales compensation planning, where even small missteps can ripple through a revenue organization, impact culture, and put revenue targets at risk. George shares the guiding principles that have helped him navigate quota setting, clawbacks, hiring timelines, and rep psychology—backed by both personal lessons and the bruises he’s witnessed others take.

The Golden Rule: Don’t Mess with People’s Money

Compensation touches livelihoods. Sellers stake their mortgage payments, kids’ tuition, and even career choices on the promises outlined in a comp plan. That’s why George leads with a simple principle he learned from a mentor: “Don’t mess with people’s money.”

He recalls a cautionary tale where an interim head of finance shifted commission payouts from bookings to customer payments midyear. On paper, it looked like a prudent move to improve cash flow. In reality, it stripped sellers of control over their earnings, instantly torpedoed trust, and prompted the top rep to escalate directly to the board. The fallout damaged morale, strained board relations, and ended the interim’s credibility overnight .

The lesson: comp changes made without transparency or seller input rarely survive first contact with the field.

Quota Setting: The Danger of Division Problems

Too often, companies start planning with a board-mandated top-line target and simply divide it by the number of sellers. George warns this shortcut nearly always fails. It ignores the real-world variables that actually determine output:

• Attrition: Reps leaving midyear create quota coverage gaps.
• Ramp Time: New hires often produce just 20–25% of quota in their first quarter.
• Productivity Curve: The 80/20 rule usually applies—top reps carry the majority of the number.

Without accounting for these, raising quotas becomes a mathematical fantasy. In one case, a CFO proposed lifting quotas by $200K per rep to close a revenue gap. George countered with historical data showing that the last time quotas were raised arbitrarily, attrition spiked, and top performers left for competitors. The net result? Less revenue, not more.

“Don’t raise quotas unless you can demonstrate something quantifiable will let sellers achieve more this year.” – George Erskine

A strong capacity model—one that incorporates productivity, ramp, and turnover—isn’t just a nice-to-have. It’s the only way to prevent optimism from becoming organizational self-sabotage. For practical frameworks, see our session on Comp Planning 101: Navigating the Essentials of Compensation Planning and our Crash Course on Quota Assignment.

The Finance Partnership: Show Your Work

RevOps and Finance often clash on comp and headcount planning. Finance prioritizes cash preservation, often backloading hires to minimize payroll. RevOps pushes for earlier hiring to ensure reps are ramped in time to contribute.

George stresses that the bridge is scenario planning. By modeling outcomes—What if we hire in Q1 vs. Q4? What if enablement cuts ramp time by two months?—RevOps can make tradeoffs clear. Showing the math neutralizes debates rooted in opinion.

Camela echoes the approach: “It’s like a math exam—showing your work is what earns buy-in.” For more on bridging this gap, check out our webinar on Finance-Proofing Your Comp Plans.

Demotivators That Kill Momentum

Even when quotas are reasonable, small oversights in plan design can derail a team:

• Delayed Rollouts: Sellers who don’t see a plan by kickoff often stall prospecting. Some literally won’t sell until comp is clear.
• Clawbacks: Docking commissions when customers churn due to poor onboarding punishes sellers for failures outside their control. George argues these are finance and process issues, not sales ones.
• Decelerators: Paying lower commission rates on early deals (before quota is hit) confuses and demotivates. Sellers need simple math they can trust.
• Over-Complexity: Plans with too many accelerators, conditions, or exceptions erode transparency. Sellers will assume the worst.

“Commissions should be easy enough that a rep can calculate their paycheck on a napkin. If they can’t, you’ve already lost trust.” – George Erskine

For more on building fair structures for SDRs and inside sales, see our Guide to Inside Sales Compensation Plans.

Comp as Strategy, Not Just Payroll

Both George and Camela stress that comp plans are psychology in action. Done well, they steer behavior toward strategic goals—cross-sell adoption, multi-year contracts, or net revenue retention. Done poorly, they spark paranoia.

Camela recalls a rep so convinced that leadership wanted her gone that she called screaming after a new plan rollout. The terms disproportionately penalized her selling style, and she interpreted it as a quiet firing. On deeper review, the paranoia wasn’t unfounded—the plan was simply misaligned with how she sold .

For additional strategies on aligning comp with company direction, read Annual Planning Without the Panic on how to plan like a pro.

Using Comp Models to Justify Investment

Capacity models aren’t just for quota debates. George uses them to secure budget for enablement and headcount. By quantifying how much an enablement leader can accelerate ramp or how new hires change total quota coverage, RevOps leaders can translate “nice-to-have” asks into hard ROI.

This approach shifts comp planning from a defensive exercise (fighting back against Finance) to an offensive tool that funds growth initiatives. To see how comp strategy extends beyond sales, explore our webinar on How to Compensate Success Teams to Maximize Revenue.

George’s Principles for Designing Comp Plans

George closes with a playbook of principles every RevOps leader should internalize:

• Anchor to values. Define your non-negotiables (“Don’t mess with money”) and defend them with data.
• Expect mistakes. With multiple plans (AE, AM, SDR, CS), at least one will need midyear correction. Fix it, don’t force sellers to eat it.
• Assume transparency. Sellers talk. If one person earns wildly different commissions for the same results, it will surface.
• Happy CFOs, happy company. If Finance grumbles when writing commission checks, something’s wrong.
• Respect the risk. Sellers carry 50% of their comp in variable pay. Treat that risk with empathy and fairness.

Final Thoughts

Sales compensation is one of the most consequential levers RevOps controls. It defines culture, motivates behavior, and signals fairness—or the lack of it. As George emphasizes, get comp wrong and you’ll fight fires all year. Get it right, and you’ll not only hit targets but also earn the trust needed to drive broader GTM transformation.

Looking for more actionable strategies on comp planning and quota setting? Check out our blog, join our community and subscribe to our YouTube Channel for more insights.