Creating balanced territories by placing the right reps in the right territories is not easy. We recently spoke with Charles Race, the executive vice president of field operations at Informatica about this topic. Informatica is an enterprise software company who is the leader in the data integration sector, with approximately $1.1 billion in sales with 3,500 employees. Charles has been with Informatica for 10 years, and heads sales, field marketing, and professional services globally.


During the conversation, we spoke with Charles about territory planning, and specifically head count relative to quota capacity. Many executives struggle with this consistently and Charlies provided valuable insight.


Determining Potential

Charles first explained how to determine the potential of each account. “We started implementing opportunity based quotas about 3 years ago,” explained Charles. What does this mean? At Informatica, they look at the account first, long before they try and create territories. They look at things such as propensity to spend, number of products or solutions they’ve purchased, and market availability. They analyze the opportunity that’s in the pipeline for the next 18 months as well. The idea is to first understand what he could potentially sell into each account by product line or solution area. And then the next level involves looking at how his team will go about supporting that opportunity.


There isn’t a single unit of measure for territory sizing used by Charles. They have segmented both roles and accounts, and they’re based on revenue of the organization and how much they spend with Informatica. This keeps them focused on the highest potential accounts with dedicated resources.


Balancing Territories

“What we need to do is balance the territories, so that the amount of time a sales rep has in a week goes towards the maximum opportunity and potential,” explained Charles. They look at the amount of quota that they should carry. And they are really looking for the amount of effort required to go after opportunities.


Charles recommends going through every sales rep’s territory as it was originally defined. This is the tops down component used at Informatica. They need to grow their business, and intend to grow faster than the market to gain market share.  Consequently, they have to look at opportunities to create new territories in order to hire additional reps to create more capacity and to go after bigger opportunities.


At Informatica, they have created a lot of ghost territories because it enables them to scale capacity based on success through the year. If they believe there’s an additional territory, but can’t afford it yet, they create a ghost territory. A sales rep will own it, knowing at some point it will become a new territory. The strategic implication is substantial. If you want to hire people and place them into territories, establishing ghost territories makes the implementation that much easier.


Setting Quotas

“You only know when you’ve got it wrong when they accept it without question,” explained Charles. “It’s really how accurate it can be where it’s a stretch goal without being a walk in the park,” he continued. In the past, they’ve made the mistake of setting quotas to all be the same. That meant some people’s quotas were too high, and others were too low. The key to success is maintaining a consistent quota setting method. And you must explain how you got to the quota based on the inputs of data. This is all things like total addressable market, propensity to spend, quarterly spend over the last 3 years, etc. Charles continued to stress that consistency is critical to success. “Whatever the rules you come up with, as to how you create the measurement of quota, consistently apply them. Otherwise you’ve got a problem,” said Charles.



We wrapped up the conversation by asking Charles for his top pieces of advice for building a capacity plan for the sales team. First, he recommends understanding how you are organized today, and how planning has happened in the past. Next, understand from the product marketing and management teams what the real total addressable market by account, product line, rep and territory. And third, use data. Ensure that you understand the bookings position by product. Do you understand, by account, how much they’re spending? Get your data into a state where you can start the planning process properly.


Because at the end of the day, capacity planning in large businesses is hard to pull off. The key is to have a well thought out methodology, like Charles. If you don’t, you will end up with a disaster on your hands. Slow down and spend the time thinking through all aspects and rely on your methodology to guide