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How Salesforce Approaches Successful Territory Planning

 

Territories are the foundation that fuels success for any sales organization. While this may be table stakes, you would be surprised how many companies do not invest enough in this crucial phase at the beginning of the year. 

Inefficient territory planning leads to reduced sales team performance, loss of portfolio visibility, and account executive (AE) attrition, and ultimately impacts the end customer. 

At Salesforce, territory planning is treated as a key strategic function. It is executed cross-functionally to ensure our sales teams start the year early, with the right territory, the right comp plan, and the right quota. You can’t have one without the others.

I’ve provided below a summary of our approach, and I hope this can help your own planning.

Drive Focus with Segmentation

It all starts with the right market definition or segmentation. Why is that important? Effective segmentation addresses the entire market, not just the top opportunity or big deal that teams naturally gravitate toward. Thoughtful segmenting differentiates investments in teams, products, and channels to create the right focus and accountability, ultimately driving accelerated revenue and making sure you are tapping the total addressable market. 

At Salesforce, we use four dimensions to guide our segmentation strategy: 

  • Region/geography

  • Company size

  • Industry

  • Customer lifecycle

We start with region/geography and identify the right segment lines for our markets. The segment lines that work for one geography in a mature market may not necessarily resonate in an emerging geography. For example, an account classified as enterprise in India may have a different segment definition in the U.S. 

Second, we layer in company size using employee count instead of revenues. We found that employee count correlates better with the complexity of the account as larger companies have more lines of business and ultimately need more products. 

Third, we apply industry grouping based on where customers require specific product solutions or expertise such as financial services, retail, or public sector.

Lastly, we incorporate the overall customer lifecycle within our planning to make sure that our customers are supported by the right skill sets (that is, companies with a large Salesforce footprint versus current customers starting their journey versus prospects).

Through this design we are able to:

  • Maximize high-quality touches

  • Align resources with strategic market objectives

  • Match our AE skill sets with account complexity 

  • Create a career path for our AEs

Find Balance

Once the segmentation strategy is finished, it’s time to start thinking about territories. Here, it is all about balance, and one size does not fit all. 

  • Our enterprise segment is highly customized to find the right match between our enterprise account and our AE based on fit and skills. 

  • Our commercial segment uses quantitative metrics about the opportunity in the account, in addition to manager judgment.

  • Our small business segment uses an automated score based on an account assignment approach, allowing us to progress smoothly and steadily with all the segments identified.

Ultimately manager judgment is the most critical factor. Managers have the greatest experience with and insight into their accounts and can inspect territories to ensure equity across all relevant factors.

Execute the Vision

Our territory planning follows a top-down approach to incorporate sales leadership feedback. 

Each year as part of our planning cycle we review account data, employee count, Standard Industrial Classification (SIC), and location data to make sure the account routes to the right segment. 

Once we have established our baseline account data we work with the sales leader who owns that segment (the SVP) to carve out account sets and allocate headcount for each of their direct reports. This exercise cascades down the management line to the frontline manager who ultimately carves out individual AE territories.

The final foundational pillar for a successful execution is having a single source of truth. That means all account data, territory data, quotas, comp plans, account intelligence, metrics, and more live in the same place. At Salesforce we house all this data in our Salesforce instance—“If it's not in the app, it does not exist.” 

Finally we drive discipline through execution, leveraging smart processes and technology to: 

  • Clearly defined timelines: Receive executive buy-in or sponsorship and ensure manageable expectations

  • Full partnering and transparency: Empower contributors and understand the limitations that may arise

  • Robust automated systems: Use scalable and flexible systems to drive territory assignment

  • Ongoing support: Territory planning isn’t a “one and done” exercise; keep documented processes and a clearly defined support plan

At Salesforce, this helps us build teams around customers designed in the best way to serve them. Successful execution of territories means all parties have visibility into the planning process — and the strong foundation and robust systems to support and make it happen.

At Salesforce, territory planning is treated as a key strategic function.”

Sanika Goleria | Senior Director of Business Planning, Salesforce

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Sanika Goleria

Senior Director of Business Planning, Salesforce

Sanika Goleria is Senior Director of Go To Market Planning & Execution at Salesforce. Her team is responsible for Go-To-Market Execution that includes territory planning for all Distribution at Salesforce. Through these planning motions, they simplify and standardize repeatable process that allow the organization to grow and scale. Sanika's team leverages technology to enable the business with the best systems and tools needed to achieve growth.  
 
 
 

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