| Course | MT455 Strategic Management of Sales |
|---|---|
| Unit | Unit 8 |
| Paper type | Quota setting exercise |
| Length | About 970 words, 6 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | BS in Business Administration |
| Updated | October 2026 |
Free sample paper for MT455 Unit 8
Potential and History, Seventy and Thirty: An MT455 Unit 8 Quota Setting Exercise for Eleven Territories
[Student Name]
Purdue University Global
MT455: Strategic Management of Sales
Unit 8 Quota Setting Exercise
[Instructor Name]
[Date]
Keystrand Access, its territories, its sellers and every figure are composite; the sources cited are real.
The Method in One Formula
Each territory's quota equals the segment target of $17.4 million multiplied by a blend of two shares: 70 percent of the territory's share of total potential plus 30 percent of its share of last year's bookings. In symbols, quota equals 17.4 times the sum of 0.7 times potential share and 0.3 times history share.
Why a Flat Uplift Fails
The simplest method would add the same growth rate to every territory's bookings. Last year the eleven health system territories booked $16.0 million; reaching $17.4 million would mean an uplift of 8.75 percent everywhere. That method rewards territories that were worked hard with steeper targets and lets thin ones stay easy. Denver shows the problem. It booked only $640,000 last year, because it went five months without a seller after a resignation. A flat uplift would give Denver a quota of $696,000, as if its low history reflected low demand, while Minneapolis, which a strong seller has already penetrated to 70 percent of its potential, would receive $1.83 million, the hardest target relative to what remains. Chowdhury (1993) found that sellers' effort rises with quota difficulty only up to a point, beyond which very difficult quotas reduce effort, so quotas that are wildly uneven in difficulty waste effort at both ends.
Building Potential
Potential is built account by account. For each of the 380 health systems and campuses in the eleven territories, the analyst estimated door counts from building records and facility surveys, then applied Keystrand's average revenue per door and the hardware refresh cycle, typically about ten years for readers, plus the subscription value of moving each account to cloud software. Potential totals $32.0 million across the eleven territories, against $16.0 million booked last year, an average penetration of 50 percent.
Why History Keeps a 30 Percent Weight
Quotas built only from potential would ignore real differences that potential cannot capture: a territory where Keystrand has an established reputation, an integrator partner with strong relationships or a large customer in the middle of a multiyear rollout. History captures some of that. Thirty percent keeps history relevant without letting a single bad year, such as Denver's vacancy, set the target. Zoltners et al. (2006) describe blended methods of this kind as a common compromise between fairness and realism in quota setting.
Denver's low history reflected five months without a seller, not low demand, and a flat uplift would have treated the two as the same.
The Territory Table
Minneapolis: potential $2.39 million, booked $1.68 million, penetration 70 percent; last-year-plus quota $1.83 million, blended quota $1.46 million.
Chicago: potential $5.00 million, booked $2.55 million, penetration 51 percent; last-year-plus $2.77 million, blended $2.74 million.
Denver: potential $2.10 million, booked $0.64 million, penetration 30 percent; last-year-plus $0.70 million, blended $1.01 million.
Atlanta: potential $3.31 million, booked $1.20 million, penetration 36 percent; last-year-plus $1.31 million, blended $1.65 million.
Dallas: potential $4.10 million, booked $2.05 million, penetration 50 percent; last-year-plus and blended both $2.23 million.
Kansas City: potential $2.00 million, booked $1.35 million, penetration 68 percent; last-year-plus $1.47 million, blended $1.20 million.
St. Louis: potential $2.20 million, booked $1.31 million, penetration 60 percent; last-year-plus $1.42 million, blended $1.26 million.
Nashville: potential $2.80 million, booked $1.05 million, penetration 38 percent; last-year-plus $1.14 million, blended $1.41 million.
Indianapolis: potential $2.40 million, booked $1.37 million, penetration 57 percent; last-year-plus $1.49 million, blended $1.36 million.
Omaha: potential $1.80 million, booked $1.02 million, penetration 57 percent; last-year-plus $1.11 million, blended $1.02 million.
Charlotte: potential $3.90 million, booked $1.78 million, penetration 46 percent; last-year-plus $1.93 million, blended $2.06 million.
The blended quotas sum to $17.4 million.
The Ramp for Denver
Denver's new seller starts in January. A new health system seller needs time to learn the territory and build relationships, and sales cycles run six to nine months, so the first quarters will produce little. The ramp sets Denver's quota at 50 percent of a full quarter in the first quarter and 75 percent in the second, then full quota from the third. Against a full quarterly quota of about $252,500, that is about $126,000 in the first quarter and $189,000 in the second, a reduction of about $189,000 for the year. The reduction is held by the regional manager as a reserve rather than spread over the other ten territories, so that no other seller pays for Denver's vacancy.
The Fairness Check
A fair quota should ask each seller for a similar share of what is available. The check divides each quota by its territory's potential. Under the flat uplift, that ratio runs from 0.33 in Denver to 0.76 in Minneapolis, so the Minneapolis seller would be asked to capture more than twice the share of the Denver seller. Under the blended method, the ratio runs from 0.48 in Denver to 0.61 in Minneapolis. Minneapolis is still asked for more, which history justifies, since its seller has already proven the territory, but the spread is narrower.
What to Watch
Two things will be watched in the first half. If Minneapolis's seller argues that the lower quota undervalues proven work, the answer is that the quota reflects what remains, and the pay plan's accelerators reward exceeding it. And the potential estimates themselves will be checked against actual door counts as sellers visit accounts, with corrections made at midyear. Johnston and Marshall (2021) note that sellers accept quotas more readily when they understand how the numbers were built, so each seller will receive the account-level potential for their own territory.
References
Chowdhury, J. (1993). The motivational impact of sales quotas on effort. Journal of Marketing Research, 30(1), 28-41. https://doi.org/10.1177/002224379303000103
Johnston, M. W., & Marshall, G. W. (2021). Sales force management: Leadership, innovation, technology (13th ed.). Routledge.
Zoltners, A. A., Sinha, P., & Lorimer, S. E. (2006). The complete guide to sales force incentive compensation: How to design and implement plans that work. AMACOM.
What the MT455 Unit 8 assignment asks for
The Unit 8 task in MT455 sets quotas for a group of territories that sum to a given target. State the method in one formula before showing any numbers. Explain why a simple uplift on last year's results is or is not appropriate, using the territories' circumstances. Build territory potential from the accounts, showing the inputs. If you blend potential with history, justify the weights. Present a table with each territory's potential, history, penetration, the simple-uplift quota and your quota. Handle new or vacant territories with a ramp and say where any shortfall goes. A fairness check, such as quota divided by potential, shows whether the burden is spread sensibly. Close with what you will watch as the year unfolds. Four pages with a spreadsheet-built table is typical, and every quota should be reproducible from the formula.
How the MT 455 Unit 8 example is put together
The Keystrand exercise states its formula first. A section rejects the flat uplift, using Denver's vacancy and Minneapolis's high penetration as the two examples, with Chowdhury on quota difficulty. Potential is built from 380 accounts' door counts, revenue per door and refresh cycles. The 30 percent history weight is defended with Zoltners and colleagues, under a highlighted line on Denver's vacancy. The territory table follows, listing all eleven with potential, bookings, penetration and both quotas, and confirming they sum to $17.4 million. Denver's ramp sets 50 and 75 percent quarters and holds the $189,000 reduction as a manager's reserve. The fairness check compares quota-to-potential ratios under both methods. A last section plans for Minneapolis's objection and a midyear potential check, citing Johnston and Marshall on sharing the numbers with sellers.
Where the points sit in the MT455 Unit 8 rubric
Quota exercises are graded on method, transparency and fairness. Instructors credit a formula stated up front and applied consistently, so any quota can be reproduced. Explaining why a simple uplift fails, with specific territories, shows understanding of what history does and does not measure. Potential built from accounts earns more than potential assumed. Justified weights for blending potential and history are a frequent marking point. A ramp for new sellers, with the shortfall handled explicitly, shows practical sense. A fairness measure comparing territories rewards careful thinking about how quotas feel to sellers. The table must sum to the target, and graders often check. Planning for objections and midyear correction shows the quotas are managed, not just issued. Research on quota difficulty and incentive design should support the reasoning.
MT455 Unit 8 help from the desk
The commonest Unit 8 weakness is applying the same growth rate to every territory without asking why territories performed as they did. Another is setting quotas from potential alone, which ignores real differences in market position. Students often assert potential figures without showing how they were built. Vacant territories are frequently given low quotas permanently because their history is low. Ramp shortfalls are sometimes spread silently over other sellers. Tables that do not sum to the target are common. Before submitting, add your quotas and confirm the total. Then divide each quota by its territory's potential and look at the highest and lowest ratios. If one seller is asked to capture twice the share of another, you should be able to explain why in a sentence, or adjust the method.
Get an MT455 Unit 8 example written to your instructions
Send the territory data your Unit 8 case provides, or describe the sales team you want quotas for, together with the rubric. Built from potential with history blended in and every figure checked to sum, a custom quota setting exercise lands in 24-48h, with a first exercise at no cost. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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MT455 Unit 8 questions, answered
Why not just add a growth rate to last year's sales?
Because last year's sales reflect more than a territory's opportunity: seller skill, vacancies, a lucky deal. Adding the same percentage everywhere makes strong territories harder and weak ones easier, which feels unfair and misdirects effort. Potential-based quotas ask what each territory could reasonably produce. Many companies blend the two, and explaining your blend is usually what graders want.
How do I estimate territory potential?
Build it from the customers: the number of accounts, their size, and what a typical account of that size buys. Your case may provide market data or a buying power index. If it does not, state assumptions and show the calculation for at least one territory. Graders tend to accept rough estimates if the method is sound and the weak inputs are named.
Should quotas for new sellers be lower?
Usually, for a defined ramp period. New sellers need time to learn the product and build a pipeline, especially where sales cycles are long. A common approach reduces quota for the first one or two quarters, then moves to full quota. Say what happens to the difference, since spreading it onto other sellers creates its own fairness problem.
Where can I find a free MT455 Unit 8 sample paper?
This page carries the full MT455 Unit 8 exercise setting eleven territory quotas from potential and history for a composite access control company.
Why does Denver's quota rise in the MT455 Unit 8 sample?
Its low $640,000 history came from five months without a seller, not low demand, so a potential-weighted quota of $1.01 million replaces a $696,000 uplift on history.