This newsletter is called Uncharted Territory for a reason. I happen to believe territory design is one of the highest-leverage processes in GTM. Every action your reps take happens downstream of the accounts they’re assigned. It’s simple: bad territories can turn great reps into poor performers and good territories can improve your whole team’s attainment.
I wrote about the territory planning process a couple weeks ago but I’m told that not everyone likes to consume their information in the most words.1 Lucky you! This week, I’ve got an interview about territory planning and design with Joe Ort.
Joe’s been doing this a long time. He’s currently the CEO of RevOps Inflection. Before that, he’s done territory design at companies like SiriusDecisions, Brainshark and Collibra as well as supporting the process across a PE portfolio. He’s got plenty of tips and tricks.
We had a great chat. Watch the video to learn how territories are like icebergs, why sales reps would make good lawyers and how to structure a planning process that (mostly) won’t drive everyone insane.
For those of you who do actually like words, below are some of the key takeaways from the conversation.
On the data foundation (2:42)
“When you look at the iceberg of territory planning, all that [data] stuff underwater is the bulk of the work.”
The first phase of territory design is about getting your account data as good as possible—without losing sight of the fact that your data will never be perfect. You can do all the careful segmentation and territory balancing you want, but if the underlying data’s complete garbage you won’t be successful.
One area that we returned to a couple of times in the conversation is hierarchies. These tend to cause a lot of trouble in most territory designs—especially enterprise and strategic. Joe recommends spending extra effort on getting hierarchies right and suggests D&B as the best data source.
Once you’ve got this data, then it’s all about narrowing down the segmentation and getting specific about ICP.
On order of operations (8:00)
“Start at the top level […] Then […] start working your way down the organization til you get down to the first level sales managers. Cause those guys know actually what’s happening in a lot of these accounts.”
Once you’ve invested in getting the data right up front, Joe recommends that the RevOps team do a first pass on segmentation and account potential calculations before presenting anything to the sales leadership.
These calculations should take into account a host of metrics that span the entire funnel: lead volumes, sales cycle length, ASP and renewal rates. If you’re just focused on ASP, you’ll make bad decisions, especially in SaaS where CAC payback often requires at least one annual renewal before you start making money.
From there, he recommends taking that first pass to sales leadership and iterating. After that, start working your way to the front line managers and sales reps to get account-by-account intelligence as necessary.
On managing subjectivity (14:26)
“You’ve got to have the decision maker […] they have to have the final call.”
Every territory plan is a combination of objectivity and subjectivity. There’s plenty of math but also plenty of opinions. Expect lots of stakeholders to weigh in with different perspectives about the best approach.
This subjectivity (and a dose of politics) also manifests itself in things like holdover requests and feedback processes. Not only are these sometimes sources of conflict, the mechanics of the process can be really hard to scale.
Joe calls out that you’ve got to rely on a single decision maker who’s empowered to make the final call on anything that’s in dispute. That’s usually the CRO.
On exploring scenarios (36:02)
“A choice of one is not a choice.”
My theory is most teams end up with suboptimal territories because they simply run out of gas before exploring all the options. Building any particular territory scenario takes so much manual effort that they rarely fully build out more than one.
That’s why I love Joe’s quote above. You’ve got to at least give yourself two options or you’re not giving yourself an actual choice. Make sure you build in time to try more than one scenario.
On focus (38:56)
“Think about how much better your win rate is going to be if you’re not spending time on these accounts that aren’t likely to close any time soon.”
We wrapped the conversation with a discussion of the territory taxonomy and how best to use territories to drive focus.
Joe mentioned that the first time he cut territories, reps ended up with 3,000-4,000 accounts and it was terrible. Now he tries to make sure reps only have to focus on those accounts that are great fits and are likely to buy in the next 6-18 months2.
He quotes the late Jim Ninivaggi from his time at SiriusDecisions, “We don’t need 3x pipeline if we’re only working accounts that are going to buy. We only need 1x.”
Though if you don’t like 2,000 word essays on in-depth sales topics, then you’ve arrived at the wrong newsletter. You’re also probably not someone who reads footnotes.
This is one reason I believe so strongly in non-traditional territories for commercial sales teams in particular. You just can’t know this all upfront to support a once-a-year carve.
