What metrics do you use to justify a pay raise?

When determining whether someone should receive a pay increase, it's important to ask three key questions. 

1.) Is the rep displaying the golden side of our values and behaviors? 

2.) Did the rep achieve or exceed 100% of their target? 

3.) Is the rep actively learning and applying lessons from their manager and sales enablement in their sales activities?

The piece around values and behaviors is critical. Reps should not be eligible for a raise, no matter how much they’ve exceeded their goal, if they are not consistently showing up in a way that aligns with the values.

I am a firm believer of meritocracy. So when it comes to pay raise especially in sales roles it should be very black and white for a sales rep to determine when would they qualify for a pay raise. 

It should be very easy for sales people to chart out their salary hikes based on their performance. The more consistent you are in delivering and over achieving your targets, the faster you should get to your pay raise. 

Needless to say, that there is no compromise when it comes to ethics and integrity when you are achieveing your targets. 

There are many KPI's and metrics you can evaluate for pay raises. Ultimately this is situational based on your companies revenue targets, values and policies. I believe there are 3 key factors in justifying a pay raise:

1) Craft: Mastery of your craft and demonstrated ability of your roles key competencies.

2) Impact: Have you had an outsized impact on Revenue and your GTM organizations key objectives. Some of the key KPI's that I look at are Revenue Growth, Attainment, New customer acquisition and Deal size. Secondly is any contributions you have made off the dashboard to impact the broader team i.e. Process improvements, enablement and creating assets that can be used by the team.

3) Behavior: Demonstrating the right behaviours in how you conduct yourself. I.E. Grit, resilience, positivity etc.

In the end, the lagging indicators are what will justify a raise. They used to call it "earning your seat," referring to the physical seat you sit in. Within sales, you are either creating, winning, or keeping revenue, so those that can portray the most will typically get the increases and promotions.

Now to get there is different and this is where leading indicators come in: who, when, how, and how often are you contacting who you need to in order to produce results. Successful sales reps can follow the formula in the most efficient way to produce results.

This one’s easy! In sales, your performance metrics are your best evidence. Start with your revenue numbers—they’re the clearest indicator of success. Beyond that, track and showcase your quarter-over-quarter (QoQ) improvements in metrics like close ratio, deal size, or pipeline growth. For example, demonstrating consistent improvement in your ability to close deals is a strong justification for a salary increase.

Tracking your own metrics not only helps you improve as a sales professional but also shows leadership you’re thinking strategically and providing valuable insights to the business. Thus making the business ant to invest in you further.

If I were a sales rep trying to justify a raise, I would ensure I know:
-Performance against quota

-Percent to goal

-MRR / ARR sold

-If at a very early stage company, your contribution to the company's growth might be material, what % growth on the top line did you drive?

-If larger, I'd be thinking about the KPI impact of strategic projects. I.e. if you developed a sales play that increased close rates of your peers from 20 to 30% - can you quantify that impact in revenue.

It's a lot easier to ask for a raise when you can spell out that you drove $1 mil in incremental growth above and beyond your quota.