Why the Person Running Your Comp Plan Should Be the One Closest to the Pipeline

Jose Leman: Welcome to go to Masters and welcome to season four. We sit down with the Rev Ops, sales ops and go to market leaders from some of the most demanding B2B companies today and unpack the real thinking behind the decisions that move revenue. I'm your host, Jose Le man, and today's guest has a taken sales compensation that a lot of people in this audience need to hear. Daniel Wallman spent 15 years in Biz Ops and RevOps before he became a comp person. And he thinks that's exactly why rebops leaders should be the ones running incentive schemes. Not finance who provide over design for cost control or HR over design for fairness, but rather rev Ops who designs for behavior. Daniel is head of incentive compensation at duxt, a bookkeeping automation software company where he's a solo practitioner, meaning he builds a plan, runs a plan, pays a plan, and lives with the consequences of every design decision. Daniel, welcome to the show. It's a pleasure to have you.

Daniel Wallman: Thank you very much for having me. Looking forward to passing on some of my accumulated knowledge and opening a debate around compensation with a different light.

Jose Leman: Excellent. Why don't you start us off by telling us a little bit about the role of the company, what the company does, and just paint a picture about how a day in the life for Daniel would be.

Daniel Wallman: Yeah, so as Jose says, I'm a, uh, solo practitioner, I'm a individual contributor, um, but part of a bigger RevOps team. Um, I was hired by Dex to do revops for our, uh, two biggest regions, uh, UK and France. Um, but as the guy, the go to guy in the team who was at the time the most Excel savvy, uh, in the team, it made sense that when finance were offloading compensation, which at the time was being run out of Google sheets, uh, my manager came to me at the time was like, hey Dad, I think this is for you. Uh, and to my detriment I said, yes, um, and it's driven me down this path of learning as much as I can about compensation, bringing in my knowledge of many different industries, many different businesses, not just industries, but businesses themselves. And the style of ways that we look at compensation, um, from a data and a behavior perspective rather than from this, the typecast way of way. Most people would say, oh yeah, we're running compensation, but we don't really want to pay you. So I look at it and go, hey, what are we trying to achieve as a business? What's the new product? Whatever we're doing as a business. How can I get my reps in all the different regions that I support to do that. So we've got a new product launch. How do we make that product launch go really well? By incentivizing someone. How do we say our key goal for the year? Our North Star as we call it. That's ah, our North Star for the year. How can I get that? Supported by reps, by csm, by management, by the teams and by the people that are incentivized to perform. Incentive compensation is a payment for performing well. It's not a payment for just turning up and doing your job. It's for overachieving. So 15 years is a, uh, in biz ops. Rev Ops Ops in general has led me down this path of how do we incentivize people but by looking at it from what we need you to do.

Jose Leman: Yeah, that's a really good. I mean I definitely agree that having that background in operations and on the business, it's a really important area for us in comp to just to get good at. Right. So let's unpack this. I mean you just out of the gate, this statement that finance shouldn't own, uh, comp. HR should own comp. It should be RevOps. I'm not disagreeing, but I want to hear you talk about your thesis a bit more like just have you seen any areas where there's been detriment if it's owned outside of RevOps?

Daniel Wallman: So uh, I wouldn't say detriment. It's just a different way of looking at it. And I don't think that when I say Rev Ops should look after it, I'm biased. Okay? I'm Rev Ops. That's my background. I'm always gonna say Rev Ops should do everything. We do everything anyway. We might as well add another string to our bow. Um, but we do things with a very different view to other parts of the business. Our view is. And when anybody. And it goes back to sort of when people ask me, what do Rev Ops do? What do you do for a living? I turn around and I say, I make sales teams perform better. And compensation is such a huge part. If you're a salesperson and you're not driven by how much compensation you can earn, you're not a sale. You're not going to be a good salesperson. Right? Like it's as simple as that. Your base does. Should cover your basic bills and um, cover your rent, cover your food on the table, cover your mortgage. That's your base. But if you actually want to earn good money as a salesperson, you need to concentrate on how you improve your incentive structure and how you get paid more by performing, you should be chasing deals, whether that be a 10 pound deal or a 10,000 pound deal, or a million pound deal. Whatever your business sells, that's what you should be chasing. We're a high velocity, low impact type revenue number, so deals are between probably 100 and 500 pounds on average. Uh, but you do have obviously much bigger and you have smaller. Um, but we aim to do a lot of them. So you should constantly. Yeah, it's a volume business and you should be constantly chasing the next sale. You're not sitting there going, how do I work this sale? I'm chasing the next sale. My portfolio has 150 partners in it. Let's chase who I can call up next and be like, hey, you're at your usage bundle. Let's, let's see what we can do for you to make upsell. And we look at it from that perspective rather than a finance perspective of we've already got this much budget, or we look at it from a people perspective and certain regions have stronger people teams than others in terms of the, uh, what's the word? Not control, but the legislation within the region. And you find that when you're talking to them, there's always this. Yeah, but the legislation says this. For example, you want to make a change to a compensation plan in France, it has to go in front of the committee, their employee committee, and then you say, we want to change compensation plan and even if it's in a beneficial way and it's going to pay them better, you still have to put it in front of them and they still have to sign it off. Whereas in the uk, North America, apac, the other regions we work in, it's a lot more flexible. We can say, hey, these are your new letters, this is the new plan, this is how it's going to work. Please sign, um, and let's discuss it. But we are telling you how we're going to operate. And it's interesting when you start digging into the inner working. So hr, or people as we're starting to move to call them, are very much like, look after the person, finance very much look after the business. And I feel that revops historically and biz ops, if you want to call it biz ops, like the olden name, in my opinion, um, we straddle so many facets of the business and we see so much more of the picture than in these individual departments. So finance will only ever see numbers, people will only ever See the person. But when rev ops, you need to see everything. You're connected with marketing, you're connected with data, you're connected with the revenue, you're connected with finds, connect with people. You're connected with everyone in the business. So when you start talking about how you design a compensation plan and that piece of the jigsaw, which is huge for a sales company, you can start pulling in that information from finance, go, well, that's the budget, you can start speaking to people and go, that's that information that I need there to ensure that the plan hits the local law correctly. And you start tweaking, you start learning, you start bringing in all these different facets that they would have spoken to each other if they'd been running it individually. But you're naturally sitting at, uh, that apex, uh, of all the regions.

Jose Leman: I think that's a key. There is that ability to bring those different stakeholders together at the same time and have that global lens that's a bit more strategic, that's covering the entirety of the business. And I think you said it at the very beginning, connecting the dots to that strategic objective, to that North Star. So the plan is, I mean, we at every stage believe that the confidence really should be a growth lever. It's not just a necessary evil, it's not just a procedural thing you do. It's actually one of the biggest tools we have as organizations to achieve those results we want. And it's often, um, underestimated and just really mishandled. So part of what we want to do, this podcast series, is just to sort of raise the level of the profession and just highlight how important plans that are actually designed to follow that, that lead, that strategy can make a big difference. Um, so this is a good segue to next question I wanted to make you, which is this, ah, fundamental sometimes, uh, again, misalignment between a plan that is performing. You can have a plan that's paying exactly the right amount for the performance that's delivered. But sometimes you have leadership a little bit uncomfortable because maybe the metric that's being chased, it almost feels like that strong performance we're paying for is not worth it. Um, that can be a bit of a structural distortion in the plan. Uh, have you come across this? How do you diagnose it? And how would you rebuild trust if that happens?

Daniel Wallman: So it's funny, we had a situation similar to that maybe 18 months ago when I started, two years ago when I took over. Uh, um, and we've had to have a restructuring of our plan. Since then and it took wholesale changes. So we had plans that were paying out on a certain number. Um, uh, the net number. I'll just say I was paying out on net number. And you could hide behind a net number quite easily. So you had some very big levers to pull because if you had big contraction you could easily cover it with big upsell. And now we want to pay for big upsell. We're not not wanting to pay, but we need to be aware of a business of big contraction and big churn and making sure that if you are struggling as a, as m a unit with contraction, how, how do we stop that? How do we stop that? So you can hide behind lots of big upsell which can cover your churn. But churn, I think, I think I read it somewhere that for every churned customer you have to sign three new customers to sort of balance out in terms of level of effort, right, of saving, one is like two to three worth of signing up new business. So every time you lose a logo you've got to replace it with two in terms of effort. So why would you want to lose logos, right? So we started thinking, right, what can we do as a business that lets us look at uh, how we can drive the right behavior? It comes back to driving the right behavior. How do we convince ourselves, our account managers, that the right thing for them to do is work just as hard on the churn and contraction as it is on the growth. We split the pot of money that they earn for each and different regions, depending on the specific needs of the region will have a slightly different blend. But everyone now in, in the account management team has two targets, a growth target and a retention target. And it is revenue based. It's not just a grr number. It is revenue based and it changes on the quarter. You are targeted for the quarter. This is your retention for the quarter. And we know we're not saying someone should have zero churn and contraction. We're not not monsters but, but we plan it and the targets are set based on the portfolio, the, the amount of renewals that they would have in that quarter. And we have, we allow for natural term. We know we're not going to. We know we are the best at what we do, but we also know we're not the cheapest. So there are other businesses out there that aren't as good as us but will offer you a similar service for a lot less. Some are free, for example. So we know we're going to have people chasing the bottom dollar on the services they provide. So we know we're going to lose partners in that regards. However, if we can convince you to work towards retaining more and will pay you for retaining it, it becomes just as important as growing your book of business.

Jose Leman: So you, you've split that metric into two, right? Retention on one side and expansion on the other. Um, two occurs in two accounts because I had to do something similar before. Uh, and it gets tricky and I know we'll talk about that later but um, what is the just roughly the weight for retention versus expansion of the plan? If you can talk about that just roughly.

Daniel Wallman: It changes, it changes depending what region and what role you are in within that region. So you've got people who are on maybe a lower ah risk portfolio, uh, because the partners are much bigger, therefore term risk is lower because they are much more, we're much more ingrained with them. They might have it six, they might have lower percentage aimed at retention than the growth portion. Um, or you might be relatively churn heavy in your portfolio. So you might have a lot more small partners where the hundred pounds a month that our uh, platform costs you is a real meaningful amount of money. And you lose two partners for two of your clients leave and suddenly you've got this, nobody's covering your costs there. Uh, and you're like well what am m I going to do? I've got to look at cutting costs somewhere. Maybe that's the platform that we drop or we drop it or because we can get it cheaper or for free. Not as well, not as good but elsewhere.

Jose Leman: I see.

Daniel Wallman: So we just, we, we ah, blend it depending on role and, and region. So there's no right, there's no like specific.

Jose Leman: And then you said this are quarterly targets set up on portfolios that presumably can change every quarter you would reassess or you do it at the beginning of the year.

Daniel Wallman: So we try not to do too much heavy movement across the year. Um, but if we start to see. So like for example one of our regions does a re jig probably once a year. Um, other regions are ah, a little bit more sporadic and it's just when it needs doing, when we start seeing that someone's portfolio was dropped or someone's portfolio has grown too much through the auto assignment. Once we take on a new business and through churn, then we might do a little bit of a rejig of some accounts here, some accounts there. We're an ever evolving business as any businesses and we're forever moving the goalposts on what classifies as a Large business, a medium business and a small business. And when we move those, we have to move the portfolio.

Jose Leman: Yeah, I asked because a lot of our audience is going to be in the exact same uh, page. Right. So it's good to hear how other people are doing.

Daniel Wallman: Uh, you have to uh, you have to constantly be recycled, like even if it's a couple. So for example, what I'm, I'm supporting, uh, one of the regions at the moment, um, with more than just comp. And um, we've got a few people where they've, they've been assigned a partner but someone else has taken it over so you've just move it. So you're constantly doing little bits and pieces here. But we try not to do massive wholesale changes too regularly. Maybe once a year, maybe every, maybe like a medium sized change. Just a bit of a realignment so that people are balanced every, every six months.

Jose Leman: What about new accounts as they come in? Do, do you assign them to the portfolio right away? Even though they're unlikely to probably churn or expand maybe in that same year.

Daniel Wallman: So yes, as soon as they come in, they're assigned an account manager. We have a very um, in depth handover process from our account executives or our new business team to our uh, account managers. Um, and the account manager works closely with the CSM to help because the most important thing you can do when you bring on a new partner is get them to adopt your product. Right. We sell bundles of licenses. So you as an accountant would buy 10 licenses as an example and then you would need to assign those to your 10 clients who are now external to us. They're not, we, we know nothing about them and uh, you need to get them trained to using our platform which then turns the ROI piece for the accountant. But in the interim what we do is we support the accountant with training, with webinars, with support, and from our CSMs on how to get their, their clients to engage with the platform and to rely on it to some extent. So what then happens is the accounting world, accountants move at a different pace to most other businesses. Most professional services do. Once they are in a space, they like to stay there because they tend to have a product that they're using with externals. So once you're very in debt, in bed with an accountant, and they've got 50, 100 partners, their clients on our platform, chances of them churning are very minimal. So the quicker we can get them to adopt, the quicker we can get reassurance that they're not going to churn yeah, just.

Jose Leman: It's the same just getting them to value as fast as you can. Demonstrating that value.

Daniel Wallman: Yeah, exactly.

Jose Leman: You know, you've actually landed the account.

Daniel Wallman: We did used to pay some csf. We used to have a, uh, CSM plan in one of the regions where we actually paid on time to value.

Jose Leman: Um. All right, switch gears a little bit to maybe that other area of comp, which is sort of performance, performance management and performance measurement. So, um, just want to get into this corner with you of really reps that are underperforming, especially if you see people that are consistently missing target by some margin. I mean we tend to think, oh, it's a performance problem. But it doesn't have to be like, it could be either a target that's set up the wrong way or maybe a wrong fit for the person on the product. Uh, or maybe there's a complex problem that's sending the wrong thing. So curious. How do you diagnose this? Um, and if you have examples, you just come up with this.

Daniel Wallman: See, you know when a target's wrong, like it, it's obvious. Um, and you would. Normally, when targeting is wrong, it's not one rep that's struggling, it's the team. Um, because it's not normally, uh, it's normally an. It's normal. It's normally a pandemic of a problem when targeting is wrong in itself. Um, so I wouldn't normally. So you can quite quickly see that a target is wrong because it normally runs through the whole team or that regional team anyway, that segment of the team. So you might find that the French account manager struggling with growth and they've all struggled with it. And so then you'll look, right, okay, is it. If they've all struggled, it's probably because targets were too high. But why are targets too high? And then it's probably gone back to budget or it's gone back to some other lever that someone's trying to pull to generate something. Right. Um, if it's um, because the person's underperforming, that normally is quite obvious. Normally what you see, or in my experience what you see is you see a decline. It's not just a sudden gone from 120% to 0%. It normally goes 120%, 100%, 90, 60, 60. And then they stay, they stay at their where now they're just, they're in this sort of lull where they're like, I don't know how to get out of it. And then that's when you have to go, to go to the manager and be like, hey, this person seems to be struggling or putting the data in front of them at least to say, look, over the last six months there's been a drop off of in um, performance. I'm putting it on your plate because you manage them. I don't know the personal situation, it might be something's going on with their personal life. It might be that their portfolio is wrong. It could be a whole myriad of reasons. Or it might just be that we say this. Uh, amongst some of the rev ops in my business, salespeople seem to have like a shelf life where they start to lose interest in a product and they don't want to sell it anymore or they don't know how to sell it. Suddenly they, overnight they look like I need to not be here. Um, and you start to see that a little bit with certain people. And if the product isn't, isn't evolving quickly enough, they lose interest because they're like, I can't keep having the same conversation.

Jose Leman: It's certainly a factor. Yeah. In many industries, uh, yeah, just people either burn out or get tired and are looking for a change. Uh, and they kind of check out quietly. Um, and yeah, that's a good thing to.

Daniel Wallman: I think it's got, it's actually got a name these days. Quiet quitting. Uh, quiet quitting. But I also say like in rev ops as well and I think in operational teams you kind of have like a shelf life as well because you can only keep bringing the same ideas to the table so many times before you get bored of bringing them and being rejected. Right. And I, I and so if you don't work for a fast paced moving industry. So I used to work in the property industry, uh, probably the most glacial of industries known to man. Still feels like you're working in the 1920s at times. Um, but um, you'd bring ideas to the table and they'd just be like maybe. But I work in SaaS now and it's very fast paced and if I bring ideas to the table I know they're going to get looked at and we might do it, we might not do it. But I also know that it's not got a shelf life. Right. And so whereas when you work in uh, property, I felt like my shelf life was three, maybe five years and I did almost five years. I always say you've got three five life. As a uh, as an employee you make, if you move much before three, you haven't really done enough in my opinion. I Know the modern. I know the younger generation these days are like 18 months, two years, and we're gone. But, like, for me, three years is where you make an impact. Five years is when you have to start in the. In certain industries. Start recycling your ideas.

Jose Leman: Yep.

Daniel Wallman: And if you get much past that, you might as well just stay there for life. Right. That's how I look at it. Right. Three, five, Life. Uh, yeah. And I feel that the faster, more modern businesses, like a SaaS business that I work in, I don't feel that that kind of applies as much anymore because Dext is not the company I joined in in terms of.

Jose Leman: Yeah, the change is coming on the company side. Not. So, uh, it's both now. Right?

Daniel Wallman: Yeah. Right. Yeah. So. And I say that in a good way. Like, the. The. We have the most. One of the most incredible atmospheres and employee interaction. Employee engagement piece is amazing at Dex. And you build relationships very quickly with people. And so it's sad when you see them leave, but you're happy because they're also going on something better. Um, or not better for them. Not necessarily better, but better for them. But you also see quite. We've seen it. We've seen it quite a few times that people leave and then they come back within six months because they're not getting that human factor that we have. Um, and I think that's a really important piece when you join a business is making sure that culturally. That's the word culture. We have an incredible culture at Dext.

Jose Leman: Uh, yeah. That boomerang effect is a good testament of that. Right. People are coming back. Number um, one, the grass is not always greener, as we all know. But two, there's just. Ms. What you have when you.

Daniel Wallman: And you don't know you've missed it until it's gone. Right. Um, great song. Um, but, yeah, like, we're very lucky in that our company culture is impeccable. Um, constantly being asked for, uh, feedback on how people are feeling on, are we communicating properly? We have open channels. I could quite easily put a meeting in with the CEO tomorrow, and he would speak to me quite happily about whatever I need to speak to him about. Whether that be work, personal, whatever. We have this culture that is breeding success. And I think you then try and bring that culture into comp. So whenever anybody has an issue, they're like, hey, Dan, can I pick this up? Of course you can. We have. I have an open book policy. You just put the call in, I'll explain it to you. I'm not necessarily going to change my opinion or we're not going to change the outcome. But I will more than happily sit down with anybody in the business and spend time explaining the decisions we have come to to driving compensation in the way that um, we do.

Jose Leman: Amazing. So let's talk about the other end of the spectrum now. The over performers that people are doing really well. Um, they are obviously some of our most valuable employees want to make sure keep them around. We have them, um, again important part of the culture to see that success happening. Um, but they sometimes hard to retain especially when we have plans that are more designed for sort of the bulk of the population. So what's your take on this personal philosophy? Do you tend to build plans that are sort of catered to make sure that the overperformers can really get their due or are more to the middle how to deal with this.

Daniel Wallman: So yeah, our uh, plans pay for over performance. Like you overperform, we will reward you. Like it's very simple. You want to do well here, we want you to do well. We will pay you if you do well. Um, and I think that's again harking back to sort of the opening sort of bit of conversation we had which is would you get that from finance? Right. Would finance be quite so willing to pay well? Whereas don't get me wrong, finance sign off on my plans. They are very much involved in the conversation. But I put it to them going, hey, when we overachieve, this is what we want to pay. And so for some people, for some plans that pays very well. For some that doesn't pay, it's exponential. But we cap, we do have a cap, um, in place to protect the business because it's the right thing to do. And over the last few years we've seen targets go up because every year businesses want to grow. So that gets filtered down onto the employees. But the employees know that if they're performing and they're performing well, they will be rewarded for it. I don't want my. I would hate for an employee to turn around to me and go, hey, Dan, I'm. I don't want to be here because I don't feel like I can earn because of the plan, not because of ability or target.

Jose Leman: They might even leave before having the conversation. They're not going to stick around because they're going to go look for the next opportunity where they can do it. Yeah, um, what, uh, just as advice to others in the same shoes, uh, as you, any, any signs that you could see that a plan maybe is Failing high performers before they start leaving.

Daniel Wallman: Yeah, when you start like if you have a cap. So if you have a cap. So our cap is quite high. Uh, mhm. But if, if you find that you're getting to the cap regularly, then someone's going to turn around and go well I, I can't earn here. Or if you are. And again this is where rev ops come in. If you start seeing people sandbagging deals and moving them out, which with rev ops you see that finance don't see that because they're not close enough to the opportunity and the, the, the sales team people aren't going to see that. People team aren't going to see that because they're doing something completely different. So as a uh, when you are doing the forecast with the team, when you're doing the cadences through sales loft or you're doing whatever you're doing as a rev ops, you can see when someone's starting to be like, hey, this deal uh, has been forecast for the last few months but they're achieving already 200% every month. So they keep pushing it out and then you see that that deal eventually falls by the wayside because the prospect gets annoyed and upset that they're not being we just want to use your product. Oh, uh, well I'll call you tomorrow. I'll call you tomorrow. You move it down and down, down.

Jose Leman: Eventually really bad outcome for everyone.

Daniel Wallman: Yeah, right. And when you start seeing that, you know that someone isn't being paid properly unless they're doing it because they're underperforming so they're moving it down the line until a quarter or a month where they're going to perform very well so they can sort of hide it, put it into a bigger number. But ultimately it's not a good look for the prospect or the partner of we want to use your product, we need more licenses, we need this, we need that. No, no, no, you just close everything. So we've gone with a ah, quite a high cap, um, which in the last 18 months hasn't really needed to be used as huge amount. Which means people aren't sandbagging. I'm sure people, I'm sure people are a little bit, but not to the extent where people are like hey, I've got this thousand pound deal. I don't know which month to put it in because I need to work out where I'm going to get paid better.

Jose Leman: Yeah. If it's generally, I mean people also like to get paid earlier. Right. So it has to be a Little bit extreme to push something out. Um, but yeah, I can't do it.

Daniel Wallman: People, but people do it, right?

Jose Leman: Yeah. Oh yeah, absolutely. Uh, tell us a little bit about your experience running this sort of ah, as a one man show that you're doing all of it. How do you manage your priorities, time, stay sane? How do you balance this being open for? I mean as you said the company culture is very open to our policy, but you're probably just at the front end of a lot of questions. Uh, how do you deal with this?

Daniel Wallman: I have a good team around me. It's as simple as that. I have an open door policy but you have to get through some other doors to get to me. Um, I try not to speak to sales reps directly unless their manager is also present because they should have had that conversation with their manager first who should then be coming to me with the query. We try and just. Because otherwise like you say, we've. I've got run uh, 150, 200 plans across the month on my own and not individual plans but like in payouts, um, I don't have time to deal with 200 individual people and the list of queries that they will have because it's not just going to be one query, is it? Let's, let's be honest, if you've got a query, it's normally half a dozen. Um, so we tend to filter that via the manager and the manager will come to me with a list of problems or questions that need answering or they probably already have the answer themselves because my managers have all been here long, uh, enough that they know the plans intimately and they know most of the answers before they need to come to me. Um, but again that's uh, not to say I don't pick up straight away when a, when a rep messages me or calls me and has a query. I just normally it's blocked off at the pass, uh, by a manager. And then there's rev ops as well. We have individual rev ops in region. Um, so at the end of month and end of quarter the managers will submit, the reps will submit their adjustments to the, to the manager. The managers do first check manager then submits them to the local rev ops who are very close to the business, much closer than I am right now. Uh, because they're working on the local um, opportunities, industry, whatever. Um, they will then look at it through their eyes and either approve or reject the adjustments. Then it comes to me who has this global picture where I can see all of the adjustments that are coming in and I check them for the value. I check them that we're following the same consistent path across the globe so that someone in APAC isn't being allowed something that someone in North America isn't, and vice versa. Just as an extreme example, two literal opposite sides of the world for me. Um, and once those are in, we process. I process push to manager and rev ops, who then do the first line of the first check along with the team member themselves and then we approve. Then it gets, goes through like three layers of approval to. Till it gets to payroll. Um, but we use a tool called Spiff at the moment. Um, it does the job. Sorry, I know this is ever staged, but we use Spiff. But it works, uh, for us at the moment. Um, and there are, as with any tool, there's pros and cons of all of them. Um, it was the one that we took at the time. Um, and I just get by. I just get by. Right now we're very busy because, uh, our, uh, financial year starts on May 1st. So we're going through tweaks and changes right now for any of our plans. There's a couple of things still in process. It's. Even though it's only, Even though it's the 29th of April, we're ahead of schedule. Uh, normally it's only coming in tomorrow. Um, but yeah, we are, we are, um, building and tweaking our plans for the start of 20 FY27 now. Um, and there are a few, few big changes, but we're pretty much sticking to where we were. There's not like I'm not making wholesale changes because we did that just a year ago. Um, and when you look at it, the basics of what we've got in play work perfectly. We haven't changed our targets for our reps in terms of what we need them to do. Our North Star, um, is tweaking, but it's not tweaking substantially that the plans are not going to drive that behavior. Um, but there are a few sort of, uh, pieces of the jigsaw that we've been trialing in certain regions that we're now thinking, well, actually let's roll it out globally because it makes sense to utilize that lever, uh, elsewhere.

Jose Leman: Yeah, so you started out, uh, just more locally, try things out. And now, uh, this year seems like it's not a, a big change here, but more of a consolidation and fine tuning which is often.

Daniel Wallman: And a few extra new and a few new plans because obviously new teams, suddenly there's. There's new teams springing up left, right and center and they're suddenly being offered an incentive and we branching out into a new piece of a business completely as we've got a whole new team that need a new, uh, incentive structure. Um, and so yeah, we're changing so building a couple of new plans. Um, we haven't got them signed. We haven't signed them off yet. We haven't fully agreed them because we're still working out a few of the metrics. Um, but we're getting there. I think we're at final stages on all of them.

Jose Leman: Well, good luck with that. Uh, seems like you're well, uh, underway. But it's always.

Daniel Wallman: They're quarterly, so as long as we communicate it quickly, I've got three months to actually get it working in the tool. Right. Like

Jose Leman: so last topic I want to talk to you about is this. Customer success plans. I know, I know you deal with those. Uh, those are notoriously hard for many reasons. Uh, and even before I, I bias you the question, just, just tell me your, your take on those. Why are they hard?

Daniel Wallman: So it depends on the business that you run and what the CSM's responsibility actually is. Um, for us, CSMs do not hold a revenue number. So where do you look? Where do you go if you're not saying to them? So some businesses, the CSMs handle all the renewals, right? So if you deal with, uh, salesforce, uh, for example, their CSMs are very heavily involved in that renewal process and they are partly responsible for renewal. As far as I'm, as far as I'm aware, we don't. Our CSMs are not, are not asked to have financial conversations. They're not asked to have that revenue conversation. That how much are you paying? This is what you get for your money. This is how much you should be. This is how much you need to buy to fulfill your PAM bundle. We don't have RCSNs having that conversation. So what do you target them on? It's difficult because simple. Some kind of activity metric.

Jose Leman: Yeah, but that doesn't, doesn't do anything interject here. Is there a world where they should you consider not having them on a plan? That's a commission plan, but just like a bonus based on a team objective or something else.

Daniel Wallman: Um, so yes and no. Uh, because you still need them to do. They're still involved. They're just not involved in the final conversation. And we want our CSMs to be driven to do the right behavior. It comes back to this whole piece of we want the Right behavior out of our teams, whether that be our CSMs, whether that be our new business, whether that be our marketing team. We want the right behavior to drive the business forward. And so we've been looking at, we've had our loads, uh, of ideas bandied around between myself and the head of csm, uh, head of Global csm. And we've talked about using something very basic like an activity based metric that is you need to do um, this amount of QBRs, uh, per quarter. You have a hundred partners in your portfolio. I want to see 25 QBRS every quarter or 10 every month or whatever it is. But that doesn't necessarily drive anything that's. Just had a call with my partner, it was a qbr. Great, well done. Here's a hundred pounds as an example. Right. Doesn't necessarily drive the right behavior. And it's very easy to then be like, right. How do I overachieve on that? Well, I just have more calls.

Jose Leman: Right, sure. Which might actually be less valuable. Right, Correct.

Daniel Wallman: Right. Because I want you to be on a QBR for an hour. If uh, it's, if you need an hour and a half on a qbr, I want you to have an hour and a half, I want you to prep it for three hours if necessary and I want you to have an hour and a half on that call with that partner so that that partner is getting the best QBR of their core of their life with any, and they turn around to any of all their other companies, uh, that they work with and go, well, I had a QBR with Dex the other day. This is what they presented to me. I want something similar. I want people to think that our sales, our uh, CSMs are putting the effort in and they are, they are, they are. I'm not saying they're not, they are. Um, but we've also got loads of new tools coming in from being built in our, from our AI team, um, which are helping us to look at risk and look at churn and contraction problems. And so we're going to start, I don't know what the final plan will look like, but we're going to start looking at metrics that they have influence over. So it'll be like your churn portfolio, your risk portfolio is red, whatever that number means. How do I bring it down by 10% over the quarter? How do I reduce my churn and risk so they'll have individual targets. This is what I would, I expect to happen, but it's not been designed yet, not being finalized. So part of this hearsay. Um, they'll have an individual target, which will be something that they completely manage themselves. And I'm a big fan of like a quantity. And like, if you're going to give people more than one metric, you give them a quality metric and a quantity metric. And so that would be, to me, your quantity metric, something that you have control over. You have a quantity of number and you need to either bring it up or down, and that is your quantity. Then you have a quality metric in this instance. And the quality metric would be, for example, the budget for concurrent contraction for the region. And you're not individualizing, like targeted on that. So you haven't got a portfolio of churn to protect, but you do from your quantity, but you're not revenue driven on it. That's my opinion. Um, and then, and then when we're talking CSMs, different CSMs very much have different skill sets. Some are really good at presenting webinars, some are really good at, ah, calling someone up and talking them through a very specific part of our platform. Some of them are great at everything. Most of them are. But some are very, very good at specific things. If you're giving people an overall target number, that is the team target number, you drive the behavior that I want to see, which is one for all and all for one. If Bob is amazing at delivering webinars, get Bob to deliver all our webinars. Like we don't have. If, if Jane is amazing at explaining our new AI assist tool, get Jane to run those webinars, get Jane to talk to a partner, get Jane to come in on this, get Bob to do that, bring people in where their strengths lie and get them to work together. I know we have this like, philosophy of like, no, no, no, look after your own. But in this instance, if you give the CSMs, who should work as a one big group, a gen, like an overall number that they have to work towards together, you'll get a good behavior out of them. Like we get good behavior anyway, but you get an even better behavior that is like a team behavior.

Jose Leman: Yeah, I've seen that kind of thing before for CSMs, and I concur it does agree. It seems to work. There's, um, also just a reminder out there. There's a lot of behaviors that we drive that are not necessarily on the plan. Right. That's why people have managers and job descriptions. And it's not all about, it has to be in the plan. So people tend to overcomplicate things. But I think in this example, even Though I think you have a good handle on how to do it and some good ideas about your CSMs you've talked about. Well, there's this new metrics that need to be developed. They need to be built by the team. We need to have.

Daniel Wallman: No, we've already got it. We've already got it. Yeah, they're already working off it.

Jose Leman: They're already working on it. Yeah. But my point is that it's not like uh, revenue or bookings. It's not something that is already well understood. There's a little bit more effort involved, uh, also making sure that reps or CSMs can see those in kind of real time because otherwise they can't influence something they can't see. So it could be a very.

Daniel Wallman: So the metric we're talking about, we have uh, our own in house AI tool that uh, analyzes all the information we have on a partner, um, and then presents it in a, in a way that is specific to the role. So new business, see it in one way, account manager, see it another, CSMC sort of bit of everything. Um, and then there's metrics on their dashboards that they have for themselves and we will be looking at potentially using something from that tool that they, that and this tool basically is now driving the business forward. So this tool has been built and it. The amount of times I see sales reps post that I've made this sale because of this tool, uh, because of what it has flagged to me, because of what it has shown, what it has highlighted, what has brought to the surface. Um, I'm confident that using that which the CSMS are uh, using is like a bible.

Jose Leman: Ah.

Daniel Wallman: And they're in it all day, every day, um, if not anywhere else. Um, that's definitely the right way for us to go. It might not be the right way for other people though. Um, but they understand that metric and they understand the importance of driving it there.

Jose Leman: Exactly. I think you've covered that. Exactly. As long as they understand that they trust it, they know it's connected to the outcome you want. That's nine tenths of the battle.

Daniel Wallman: So correct.

Jose Leman: Excellent. Daniel, thank you so much. It's been really uh, interesting chatting with you. Thanks for insights here. Um, I think it's come across here you've made a good case for why comp belongs in RevOps and I'm a big proponent of that. And as we said before, it's not that we don't work with finance and hr, but I think we're best positioned to have the biggest impact on this. Um, and I think it might be a very useful thing to put out into the world, see what we get back from the audience. Um, so appreciate your insights Before I let you go for today. We always ask our guests the same question at the end which is, is there any book, framework, podcast, any resource you'd put in the hands of someone that's building a rebops or comp career?

Daniel Wallman: Google? Uh, uh, I wouldn't even go Google anymore. I would just lob it all into your AI tool and read as much as you can. Uh, I'm self taught to some extent. Um, obviously the revox piece is from my career experience but the comp piece is self taught from learning from speaking to the person that used to run it in the business. Learning from all the people around me. Had a, I had a great manager who was heavily involved previously. My new manager is excellent as well but it's coming, still coming up to speed with comp because she comes from a different world. Um, I'm quite often putting questions to AI. Uh, we use Claude. Um, and when looking at something I will put it into Claude and wait for feedback because it, whilst it's going away and doing all the research for me and then summing it up in a way that makes sense, I can be getting on with something else. Like I think we're in a, in a world now where no doors are closed. Uh, in terms of what you can learn. Um, and I don't think you need to have a huge amount of knowledge on running commercial to run comp these days. What you do need is a knowledge of what your business is looking for.

Jose Leman: Yeah, yeah, no, that resonates and I think it's, it's, it sounds a bit obvious but yeah, there's more information out there now than ever before.

Daniel Wallman: Uh, and it's much easier to, it's much easier to take in as well because you can, you don't have to go and read all the blog. I want to ask some. When I first started doing this two years ago, AI was just starting to filter in. So I was going out and I was having to read tens, tens of pages just to get a single answer or find the right nugget of information somewhere. And then I now will put it into Claude or Gemini and I'll get it to do that for me and sum it up then there's also wonderful places such as uh, the Everstage, um, tapped, I think it's called Slack Channel. Yeah there's these communities out there like there's that one. There's a Spiff one, um, which I'm in from. From being a member, having Spiff as our platform. These. These platforms, there's people out there who have more knowledge than I'll ever have, and they're more than happy to. To pass it on, and then you can pass off as your own.

Jose Leman: Amazing. So, yeah, stay curious and just use the tools and the. The networks around you. Excellent. Well, this was Daniel Volman, head of incentive compensation at Dexterity. Thank you so much for being on the Go to Masters Season 4. And for everyone listening, if this part's something, leave us a review on Spotify or Apple podcast and connect with Daniel on LinkedIn. Links are in the show notes. We'll see you in the next one. Thanks again, Daniel. Thanks, everyone.

Daniel Wallman: Thanks for having me.