Recurring revenue has revolutionized enterprise software, making SaaS one of the fastest growing categories of startups. The change in recognition, from full value of an on-premise license, to recognizing revenue over the life of a multi-year renewable license for a service, has introduced some challenges when considering how to measure sales success. With the introduction of the new accounting standards for ASC 606, revenue recognition for on premise licensed software may mirror that of SaaS, presenting many of the same sales measurement challenges experienced in SaaS businesses. Donya Rose, one of Xactly’s Sales Compensation Design Experts, will share her perspectives on this tricky challenge with those who join her July 11th webinar. To prepare for the webinar, consider your answers to these vital questions:
- What is the best primary measure of sales performance for your organization? What about the necessary secondary measure?
- Can you identify the possible (and common) missteps in these plans? Are you currently measuring your sales team based on total contract value, or do you have long annuity “tails” in your compensation plans?
- What special considerations arise when the same salespeople selling both recurring and one-time revenue deals?
- What is the relationship between the monthly recurring revenue and recognized revenue?
- How has your organization taken churn, term and cost of capital into account in managing and focusing sales effort?