Sales leaders spend heavily on hiring and coaching, and comparatively little on how accounts are allocated. The allocation usually explains more of the performance spread than either.
Territories differ in ways quotas rarely capture
Account sets vary in existing penetration, industry concentration, buying cycle length and travel distance, and none of those are equalised by assigning the same target.
A representative inheriting mature accounts with renewals due starts from a very different position than one given a set of untouched prospects.
Because the quota is identical, the difference shows up as a performance gap and is attributed to the person.
The attribution error compounds through the year
Early results shape how managers allocate their coaching time, which support resources are made available, and which leads are routed where.
Representatives who start ahead receive more of those inputs, which improves their results further and confirms the original judgement.
The reverse operates on the ones behind, so a difference created by allocation becomes a difference in actual capability over a couple of cycles.
Turnover redistributes the imbalance rather than resolving it
When a representative leaves, their accounts are usually split among neighbours, most often the ones already performing well and considered safe.
This concentrates good accounts further and widens the spread, while the departing person's underperformance is recorded as a hiring mistake.
Redistributing on the basis of capacity and coverage instead of past results is harder and produces a more accurate read of the team.
Frequent redesign carries its own cost
Territories can be rebalanced, but every change breaks relationships that took time to build and interrupts deals in progress.
Representatives also anticipate redesign, and where it is frequent they discount long-cycle opportunities they expect to lose before closing.
The consequence is under-investment in exactly the large accounts a stable territory would develop, so instability has a measurable revenue cost.
Measuring potential separates the two effects
Estimating the addressable value in each territory, however roughly, allows performance to be read against opportunity rather than against a flat number.
The estimate does not have to be precise to be useful, because the aim is to identify large disparities rather than to fine-tune targets.
Once potential is visible, quota setting and coaching decisions rest on something other than last year's result, which is otherwise the only available proxy and a heavily contaminated one.
It also changes the hiring conversation, because a candidate can be assessed against the territory they will actually receive rather than against a predecessor whose account set no longer exists in the same form.