The Visdum Reference

Sales
Compensation
Glossary

The complete reference for sales compensation terminology — from OTE and pay mix to ASC 606 and clawback mechanics. Definitions with worked examples, written for the people who design, run, and live inside comp plans.

146
Terms defined
8
Topical clusters
May 2026
Last updated
Quarterly
Review cadence
Sales compensation is one of the most consequential systems inside a company — it shapes hiring decisions, drives daily rep behavior, determines cost-of-sales, and creates the single largest line item in most sales budgets. It also runs on a vocabulary that is surprisingly specific, full of terms like OTE, SPIFF, clawback, ramp, and ASC 606 that mean precise things to the people who design these plans — and very different things, or nothing at all, to everyone else.

This glossary is the reference. It covers the 146 terms that show up in sales offer letters, RevOps planning documents, board-level cost-of-sales reviews, and the questions sales reps ask their managers when commission statements look wrong. Every entry includes a precise definition, a worked example with real numbers, and links to related terms so you can follow the structure of an unfamiliar concept across pages.

The terms are organized into 8 topical clusters reflecting how sales compensation actually works in practice: from plan design and commission structures through revenue recognition and operations. Search for a specific term using the box above, browse by cluster below, or scan the full A-Z index.

Start here

Curated entry points for the most common reasons people land in a sales comp glossary.
Most searched this month
Top 6 by traffic
OTE
Total annual compensation at 100% quota — base salary plus variable.
Clawback
Provision requiring repayment of commission when deals churn or default.
Quota Sales
The target a rep must hit to earn full variable compensation.
SPIFF
Short-term performance incentive — usually cash or prizes for specific behaviors.
ASC 606
FASB accounting standard governing how revenue and commission expense are recognized.
Pay Mix
Ratio of base to variable in OTE — typically 50/50, 60/40, or 70/30.
For new sales reps
6 essentials
OTE
Total annual compensation at 100% quota — base salary plus variable.
Base Salary
The fixed, guaranteed portion of compensation paid regardless of performance.
Quota Attainment
Percentage of quota a rep has achieved — directly drives variable pay.
Pay Mix
Ratio of base to variable in OTE — typically 50/50, 60/40, or 70/30.
Ramp Period
First months in a sales role with reduced quotas and variable pay.
Accelerator
A higher commission rate applied after a rep exceeds a specified attainment threshold.
For Finance & accounting teams
Revenue recognition essentials
ASC 606
FASB accounting standard governing how revenue and commission expense are recognized.
Deferred Commission
Commission expense capitalized and amortized over the contract term per ASC 606.
Commission
Variable payment tied to a percentage of revenue or value generated by a rep.
Commission Statement
The detailed document showing how a rep's commission was calculated.
Commission Structure
The framework defining how commission is calculated — tiered, flat, gross-margin, or hybrid.
Decelerator
Reduced commission rate below a minimum threshold — protects margin on poor attainment.
For RevOps building or fixing plans
Plan design vocabulary
Commission Structure
The framework defining how commission is calculated — tiered, flat, gross-margin, or hybrid.
Accelerator
A higher commission rate applied after a rep exceeds a specified attainment threshold.
Decelerator
Reduced commission rate below a minimum threshold — protects margin on poor attainment.
Clawback
Provision requiring repayment of commission when deals churn or default.
Recoverable Draw
Advance against commission that must be repaid from future earnings.
ICM
Incentive Compensation Management — software category for commission automation.

Browse by topical cluster

Curated entry pointThe 146 terms are organized into 8 clusters reflecting how sales compensation actually works in practice. Each cluster has its own hub page with substantive content and a full term list.s for the most common reasons people land in a sales comp glossary.
Compensation Plan Design
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
9 Terms
Commission Structures
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
15 Terms
Commission Mechanics
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
18 Terms
Quota & Attainment
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
9 Terms
Draws & Risk
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
19 Terms
Revenue Recognition & Accounting
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
17 Terms
Operations & Workflow
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
13 Terms
Software Categories
How sales compensation plans are structured — from base salary and pay mix to OTE, quotas, ramps, and target compensation. The foundational vocabulary every RevOps and Finance team needs to design plans that motivate sales without breaking the budget.
23 Terms
Compensation Plan Design
How sales comp plans are structured — base, variable, OTE, pay mix, and quota.
22 terms
Commission Structures
Tiered, flat, gross-margin, and progressive commission models — the math of variable pay.
18 terms
Commission Mechanics
Accelerators, decelerators, kickers, SPIFFs, thresholds — the moving parts.
22 terms
Quota & Attainment
Quota setting, attainment tracking, ramps, retirement, and over-attainment.
15 terms
Draws & Risk
Recoverable and non-recoverable draws, clawbacks, holdbacks, and at-risk pay.
14 terms
Revenue Recognition & Accounting
ASC 606, deferred commission, expense recognition, and accounting workflows.
16 terms
Operations & Workflow
Commission statements, disputes, audit trails, approvals — daily comp operations.
24 terms
Software Categories
ICM, SPM, commission management software — the tools that automate comp.
15 terms

All terms A–Z

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Frequently asked questions

Common questions about sales compensation as a topic. For term-specific questions, see the individual term pages.

What is sales compensation?

Sales compensation is the total pay structure for sales roles, typically consisting of a fixed base salary and a variable component tied to performance. The variable component — earned through commissions, bonuses, or incentives — links individual payout to measurable sales outcomes like revenue closed, quota attainment, or pipeline generated.

What are the main components of a sales compensation plan?

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What is OTE and how is it different from salary?

OTE stands for On-Target Earnings — the total annual pay a sales rep earns at 100% quota, calculated as base salary plus variable commission. Unlike a flat salary, only the base portion of OTE is guaranteed; the variable portion depends on actual sales performance. Read the full OTE entry.

How are the terms in this glossary organized?

The 146 terms are organized into 8 topical clusters: Compensation Plan Design, Commission Structures, Commission Mechanics, Quota & Attainment, Draws & Risk, Revenue Recognition & Accounting, Operations & Workflow, and Software Categories. Each term page links to its cluster and to sibling terms for deeper exploration.

How often is the Visdum glossary updated?

Every glossary entry is reviewed quarterly for accuracy, with Tier 1 entries (the 25 most-searched terms) refreshed more frequently as benchmarks change. Each entry displays a "Last reviewed" date so readers can see when the content was most recently verified.

Go from glossary to working comp plan

Visdum automates every concept in this glossary — OTE calculation, quota tracking, accelerators, clawbacks, and ASC 606 compliance — for high-growth B2B SaaS companies.
See how Visdum works →