Sales Ops Glossary

Sales Ops Glossary: 40 Definitions with Formulas, Benchmarks & Examples

Plain-language definitions of the metrics, frameworks, and software categories that revenue operations teams work with every day — so your team evaluates tools and talks about revenue with precision at every stage of the buying process.

How to use this glossary

Use it alongside category pages and software profiles, not just when you're stuck

Each entry covers the definition, formula (where applicable), industry benchmarks, how teams use it day-to-day, and which software surfaces it automatically — so you go into every vendor conversation with a sharper frame.

Jump to:Revenue Metrics Pipeline & Forecast Team & Compensation Process & Methodology Software Categories40 terms

Revenue Metrics

8 terms

The numbers that define business health, growth rate, and efficiency — used in board reporting, forecasting, and comp design.

Annual Recurring Revenue (ARR)

Annual Recurring Revenue (ARR) is the total annualized value of all active subscription contracts at a given point in time. It excludes one-time fees and professional services revenue. ARR is the primary top-line metric for SaaS and subscription businesses because it reflects predictable, recurring revenue.

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Average Contract Value (ACV)

Average Contract Value (ACV) is the annualized value of a customer contract, normalized to a one-year period regardless of the actual contract length. For a two-year deal worth $60,000 total, ACV is $30,000. ACV is used to compare deal sizes consistently across the portfolio and to set quotas and plan headcount in B2B sales organizations.

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Churn Rate

Churn rate is the percentage of customers or revenue that a business loses within a defined time period. It is measured as either customer churn (accounts lost) or revenue churn (MRR lost). Churn rate is one of the most critical health indicators for any subscription business because it directly determines long-term revenue sustainability.

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Customer Acquisition Cost (CAC)

Customer Acquisition Cost (CAC) is the total sales and marketing expenditure required to acquire one new paying customer over a given period. It includes all direct costs — salaries, ad spend, tools, commissions, and overhead — divided by the number of new customers acquired. CAC is the foundational efficiency metric for evaluating how much a business spends to grow.

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Customer Lifetime Value (LTV)

Customer Lifetime Value (LTV) is the total revenue a single customer is expected to generate over their entire relationship with the business. In subscription businesses, LTV is driven by average contract value, contract length, expansion revenue, and churn rate. LTV is the primary counterpart to CAC in evaluating whether a go-to-market motion is financially sustainable.

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Monthly Recurring Revenue (MRR)

Monthly Recurring Revenue (MRR) is the normalized monthly value of all active subscription contracts at a point in time. It excludes one-time fees and non-recurring charges. MRR is the operational heartbeat of a subscription business — tracked monthly to measure growth, churn, and expansion in near-real time.

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Net Revenue Retention (NRR)

Net Revenue Retention (NRR) measures the percentage of recurring revenue retained from an existing customer cohort over a period, after accounting for expansion, contraction, and churn. An NRR above 100% means existing customers are generating more revenue than they were at the start of the period — even before any new customer acquisition.

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Win Rate

Win rate is the percentage of closed sales opportunities that result in a won deal. Calculated by dividing closed-won deals by total closed deals (won plus lost) in a period, win rate is one of the primary indicators of sales team effectiveness, competitive positioning, and pipeline quality in any B2B sales organization.

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Pipeline & Forecast

8 terms

How deals move through the funnel and how revenue gets predicted — the operational core of any RevOps function.

Deal Velocity

Deal velocity is a composite sales metric that measures how quickly revenue flows through the pipeline by combining the number of active deals, win rate, average deal size, and sales cycle length into a single number representing revenue generated per day. It gives sales leaders a unified view of pipeline health and helps identify which variable to improve for the highest revenue impact.

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Forecast Categories

Forecast categories are a classification system that groups sales opportunities by the rep's or manager's level of confidence that a deal will close in the current period. The four standard categories — Pipeline, Best Case, Commit, and Closed — give sales leaders a structured way to roll up individual deal confidence into a team-level revenue forecast.

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Marketing Qualified Lead (MQL)

A Marketing Qualified Lead (MQL) is a prospect that a marketing team has identified — through behavioral signals, firmographic fit, or lead scoring — as sufficiently interested and well-matched to the ideal customer profile to be worth passing to sales for follow-up. An MQL is not yet sales-ready; it is a candidate for sales qualification.

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Opportunity Stage

An opportunity stage is a labeled step in the sales pipeline that reflects how far a deal has progressed through the buying process. Each stage has defined entry and exit criteria — specific buyer actions or milestones that must occur before the deal advances — giving managers a consistent, comparable view of deal progress across the entire sales team.

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Pipeline Coverage Ratio

Pipeline Coverage Ratio is the total value of qualified pipeline opportunities divided by the revenue target for a given period. It tells sales leaders how much buffer they have to hit their number, with most teams targeting a 3× to 4× ratio to account for normal deal slippage and losses.

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Pipeline Hygiene

Pipeline hygiene refers to the ongoing practice of keeping sales pipeline data accurate, current, and free of deals that are stale, misclassified, or should be removed. A clean pipeline contains only opportunities with realistic close dates, up-to-date stage information, and recent activity — producing forecasts that reflect what's actually likely to close rather than what reps hoped would close weeks ago.

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Sales Pipeline

A sales pipeline is a structured, stage-by-stage view of every active opportunity a sales team is working, from first contact to closed deal. It shows how many deals are in motion, where they stand, and how much revenue is expected to close — giving managers a real-time picture of sales health and forecast potential.

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Sales Qualified Lead (SQL)

A Sales Qualified Lead (SQL) is a prospect that has been reviewed by a sales development representative and confirmed to meet the organization's minimum criteria for direct selling — typically involving confirmed budget, authority, need, and timeline. When a prospect reaches SQL status, an account executive takes ownership and an opportunity is created in the CRM.

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Team & Compensation

8 terms

How reps are structured, paid, ramped, and deployed — the levers that drive rep productivity and retention.

Accelerator (Commission)

A commission accelerator is a higher commission rate that activates when a sales rep exceeds a defined quota threshold — typically 100% of quota — rewarding overperformance with a greater percentage of each incremental dollar closed. Accelerators are the primary mechanism used to differentiate top-performer earnings from average-performer earnings in sales compensation plans.

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Commission Plan

A sales commission plan is a formal document that defines how sales representatives earn variable compensation — specifying base salary, commission rates, quota thresholds, accelerators, payment timing, and any special incentives or clawback provisions. It is the primary mechanism sales organizations use to align rep behavior with company revenue objectives.

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On-Target Earnings (OTE)

On-Target Earnings (OTE) is the total annual compensation a sales rep receives when they achieve exactly 100% of their quota. It combines base salary and target variable pay (commission), and serves as the benchmark figure used to set expectations with candidates, model sales compensation costs, and calibrate quota levels.

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Ramp Period

A sales ramp period is the structured time between a rep's start date and the point at which they are expected to carry and achieve a full quota. During ramp, new reps receive reduced quota targets that increase incrementally as they complete onboarding, training, and early deal cycles. Ramp length is primarily determined by average sales cycle length and product complexity.

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Sales Capacity Planning

Sales capacity planning is the process of calculating how many productive sales reps are needed to achieve a revenue target, accounting for quota per rep, ramp time for new hires, expected attrition, and the lag between hire date and full productivity. It connects the revenue plan to the hiring plan and is the primary input for sales headcount budget decisions.

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Sales Quota

A sales quota is a quantitative performance target — typically a revenue number — assigned to an individual rep, team, or territory over a defined period. Quotas form the foundation of sales compensation plans by determining when and how much variable pay is earned, and they serve as the primary tool for allocating revenue responsibility across the sales organization.

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SPIFF (Sales Performance Incentive Fund)

A SPIFF (Sales Performance Incentive Fund) is a short-term, targeted incentive paid to sales reps on top of their regular commission for completing a specific sales action — such as selling a particular product, closing deals in a slow quarter, booking demos with a specific persona, or winning deals in a new market segment. SPIFFs are tactical, time-bound, and separate from the annual commission plan.

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Territory Planning

Territory planning is the process of segmenting the addressable market into defined groups of accounts and assigning each group to a sales rep or team. Territories are balanced based on revenue potential, account count, geographic clustering, and rep capacity — with the goal of giving each rep a workable set of accounts that can be worked effectively and contribute to their quota.

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Process & Methodology

8 terms

The qualification frameworks and execution workflows that drive consistent, repeatable sales performance.

Account-Based Selling (ABS)

Account-Based Selling (ABS) is a B2B sales strategy where reps treat a defined set of high-value target accounts as markets of one — coordinating outreach, messaging, and engagement across multiple stakeholders within each account rather than prospecting individual leads. ABS is typically paired with Account-Based Marketing (ABM) for a coordinated GTM motion.

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BANT

BANT is a four-element sales qualification framework developed by IBM that helps reps assess whether a prospect has the Budget, Authority, Need, and Timeline to be a viable opportunity. It is best suited for transactional or mid-market deals and is less effective for complex enterprise sales involving multiple stakeholders and long procurement cycles.

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Challenger Sale

The Challenger Sale is a sales methodology developed by Matthew Dixon and Brent Adamson in which reps win by teaching prospects something new about their business, tailoring the message to each stakeholder, and taking constructive control of the sales conversation — rather than building rapport and responding to stated needs.

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Dead Deal Criteria

Dead deal criteria are the specific, documented signals that indicate an opportunity is no longer worth active pursuit and should be disqualified from the pipeline. Unlike gut feel, these are objective, observable conditions — such as no Economic Buyer contact, 21+ days without response, or budget explicitly removed — that trigger a formal review and disqualification decision.

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MEDDIC / MEDDPICC

MEDDIC is a B2B sales qualification framework built around six elements: Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain, and Champion. MEDDPICC extends this with Paper Process and Competition, making it better suited for complex enterprise deals with legal reviews and competitive overlaps.

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Mutual Action Plan (MAP)

A Mutual Action Plan (MAP) is a shared, collaborative document that outlines the specific steps, task owners, and deadlines required for both the buyer and the seller to reach a signed contract and successful go-live. It replaces informal close date estimates with a concrete, agreed-upon timeline that both sides are accountable to.

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Sales Cadence

A sales cadence is a structured sequence of outreach touchpoints — emails, calls, LinkedIn messages, and other channels — designed to engage a prospect over a defined period. Cadences standardize when and how SDRs and AEs reach out to target contacts, removing reliance on individual rep judgment and creating a repeatable, measurable outbound motion.

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Sales Playbook

A sales playbook is a documented guide that captures how a sales team sells — including the ideal customer profile, messaging frameworks, talk tracks, objection handling, discovery questions, demo scripts, and qualification criteria. It standardizes best practices so every rep can execute at the level of the top performers, not just the ones who figured it out on their own.

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Software Categories

8 terms

The tools that automate, track, and surface revenue data — what each category does and when to buy it.

Conversation Intelligence

Conversation intelligence software records and transcribes sales calls, then uses AI to analyze what was said — detecting keywords, objections, competitor mentions, and talk patterns. Sales leaders use it for rep coaching, and sales ops uses the aggregate insights to refine playbooks, identify what top performers do differently, and track competitive messaging trends.

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CPQ (Configure, Price, Quote)

CPQ (Configure, Price, Quote) software automates the process of building accurate product configurations, applying the correct pricing and discount rules, and generating professional sales quotes. It eliminates manual quoting errors, enforces pricing governance, and compresses quote turnaround time for B2B sales teams with complex or configurable products.

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CRM (Customer Relationship Management)

A CRM (Customer Relationship Management) platform is the system of record for all customer and prospect data — contacts, accounts, opportunities, and activities. Sales ops teams use it to manage the pipeline, enforce process, run reports, and connect every other tool in the revenue stack.

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Data Enrichment

Data enrichment is the process of appending missing or outdated information to CRM records — including firmographic data like company size and industry, contact data like verified email and phone, and technographic data about installed software. Enrichment tools automate this process at scale, keeping CRM data current without manual research by sales reps.

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Incentive Compensation Management (ICM)

Incentive Compensation Management (ICM) software automates the calculation, tracking, and communication of sales commissions and bonuses. It replaces manual spreadsheet-based comp processes with a system that runs attainment calculations accurately at scale, gives reps real-time visibility into their earnings, and produces the audit trails that finance and compliance require.

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Revenue Intelligence

Revenue intelligence software automatically captures sales activity from email, calendar, and calls, then uses AI to score deal health, surface pipeline risks, and generate forecasts. It gives sales leaders and ops teams an objective, data-driven view of what is actually happening in the pipeline — without relying on manual CRM updates from reps.

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Sales Engagement Platform

A sales engagement platform (SEP) is a workflow tool that helps sales reps execute structured, multi-channel outreach sequences across email, phone, and LinkedIn. It automates the timing and cadence of touches, tracks prospect engagement, and syncs all activity back to the CRM — enabling reps to work more leads without sacrificing personalization.

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Sales Forecasting Software

Sales forecasting software generates revenue projections by combining CRM pipeline data, historical win rates, and AI/ML deal scoring with structured rep and manager submission workflows. It replaces spreadsheet-based forecast models with a purpose-built system that produces more accurate, auditable, and timely revenue predictions for sales leaders and finance.

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