CSCP Territory & Quota Design 1 — Questions and Answers
Question 1: Which method of quota setting bases individual quotas on the historical sales results of each representative adjusted for expected market growth?
- Bottom-up quota setting (Correct answer)
- Top-down quota allocation
- Market potential modeling
- Zero-based quota design
Correct answer: Bottom-up quota setting
Bottom-up quota setting starts with individual rep history and adjusts for anticipated growth, making it rep-specific and data-grounded.
Question 2: When a company divides its total revenue target among regions and then down to individual reps, this approach is called:
- Bottom-up quota setting
- Opportunity-based quota setting
- Top-down quota allocation (Correct answer)
- Activity-based quota setting
Correct answer: Top-down quota allocation
Top-down quota allocation begins with the corporate revenue goal and cascades it downward through regions, districts, and individual reps.
Question 3: A 'balanced territory' in sales compensation design primarily aims to:
- Ensure all reps earn the same total compensation
- Equalize workload and market opportunity across reps (Correct answer)
- Eliminate all geographic boundaries
- Maximize the number of accounts per rep
Correct answer: Equalize workload and market opportunity across reps
Balanced territories are designed so that each rep has a comparable workload and revenue opportunity, enabling fair quota attainment comparisons.
Question 4: Which of the following is the BEST leading indicator of territory potential when designing new sales territories?
- Prior year actual sales in the territory
- Number of competitive reps in the region
- Total addressable market (TAM) within the territory (Correct answer)
- Average deal size closed last quarter
Correct answer: Total addressable market (TAM) within the territory
Total addressable market represents the maximum revenue opportunity available, making it the best forward-looking indicator of territory potential.
Question 5: What is the primary purpose of applying a 'seasonality adjustment' to sales quotas?
- To punish reps who perform poorly in slow months
- To align quota timing with natural buying cycles in the market (Correct answer)
- To reduce the total annual quota amount
- To synchronize rep quotas with product launch schedules only
Correct answer: To align quota timing with natural buying cycles in the market
Seasonality adjustments distribute quota across the year in proportion to when customers naturally buy, making each period's target fair and realistic.
Question 6: In territory design, 'account potential scoring' is used to:
- Rate the creditworthiness of customer accounts
- Rank accounts by their likelihood to churn
- Estimate the revenue that could be generated from each account (Correct answer)
- Measure account satisfaction scores
Correct answer: Estimate the revenue that could be generated from each account
Account potential scoring assigns a revenue opportunity estimate to each account, enabling equitable distribution of high- and low-potential accounts across territories.
Question 7: Which territory alignment tool uses geographic data layers, account locations, and sales data to visually optimize territory boundaries?
- CRM pipeline dashboards
- Territory mapping software (Correct answer)
- Compensation modeling spreadsheets
- HR workforce planning systems
Correct answer: Territory mapping software
Territory mapping software combines geographic and sales data to visualize and rebalance territory boundaries for equitable workload and opportunity distribution.
CSCP Territory & Quota Design 1
Which method of quota setting bases individual quotas on the historical sales results of each representative adjusted for expected market growth?