Comp & Quota Design Glossary
The terminology of sales compensation design sits at the intersection of revenue planning, behavioral economics, and operational finance. Some of these terms are borrowed from HR compensation practice (on-target earnings), some from sales operations (quota-setting methodology), and some have emerged from the specialized discipline of incentive architecture itself (attainment distribution analysis, variable compensation ratio optimization). What they share is that they all surface in the conversations PE operating partners and revenue leaders have when they are trying to figure out why reps are not doing what the revenue plan needs them to do.
These definitions are written from a practitioner perspective — not textbook abstractions, but the way these concepts actually get discussed in comp committee meetings, board reviews, and the first 100 days after a PE investment closes.