There's a way to fire somebody without ever having the conversation.
Put their whole compensation on the size of their book, and wait.
The book shrinks for reasons they don't fully control. Their income shrinks with it. A few months of that and they leave on their own, and nobody in the building ever had to set an expectation, run a coaching session, or make a decision they'd have to defend.
That isn't a compensation plan. It's an exit executed slowly enough that management never has to own it.
Where this comes from
The metric underneath it is fine. Revenue Under Management is just the recurring revenue a person is responsible for delivering against, and tying part of someone's pay to whether that book grows is entirely reasonable.
The damage is in the word "part."
Put a customer success manager or account manager on 100% variable tied to their book and you've handed them full responsibility for outcomes they only partly influence. Product quality moves the book. Sales fit moves the book. A champion leaving moves the book. Their market having a bad quarter moves the book.
None of that is theirs, and all of it lands on their paycheck.
What it produces
People avoid difficult customers, because a difficult customer is a pay cut.
They refuse handoffs of at-risk accounts, which is exactly when an at-risk account most needs somebody competent.
They burn out carrying variance they didn't create.
And you struggle to hire, because the offer is "come do a job where your income depends on things you can't reach."
Every one of those is rational. You built it.
The version that works
Strong base, plus a variable component tied to the book, with no ceiling on the variable.
90% of on-target earnings as base and 10% as the variable is a workable shape. Perform and the variable takes you past 100% of OTE. Underperform and it falls back toward base.
And that's where the mechanism stops. You don't keep taking money away.
If somebody isn't performing, manage them. Set the objective, coach against it, hold them to it, and remove them if nothing changes. That's the job. Taking money away until they quit is the substitute for doing that job, and it's why RUM comp has the reputation it has.
The single test is whether there's real upside. A plan with upside says grow with the company. A plan without it says suffer with the company, and people work out which one they're on inside a quarter.
The thinking underneath the punitive version
There's a mentality in some companies, and it's loudest in the ones that are struggling, that a salary makes you suspect.
You're taking a salary. You're not aligned. You should be paid the way the founders are paid, on a percentage, because that's what commitment looks like. Anything else and you're a passenger.
While things are going well this even seems generous. A fixed cost looks small against a growing book.
Then the book shrinks, and the same fixed cost looks like the problem, and the person on salary becomes the thing to point at. Everybody above them is on a percentage, which is not alignment. It's a cut of the company.
At the far end you get "100% of your comp on the book, and if you want anything guaranteed you're in the wrong business."
I'm not in business. It's a job.
I take no equity risk and I have no equity upside. You take all the risk and you have all the upside, and to get there you hire people to do specific work for predictable money. That's the trade. That's the entire reason employment exists.
What you actually want
You want people whose income rises when the book they're responsible for rises. You want that rise to be uncapped so a great year feels like one. You want the downside to stop at base, because below base is a management problem and not a payroll one.
You want them to grow with the company.
Not suffer with it.
Lincoln Murphy formally named and popularized Customer Success starting in 2010 and has spent 15 years connecting it to expansion revenue and commercial outcomes. Read The Premise.