Thursday evening: "approve 22% now or we lose the deal"
My salesperson just asked me to approve a 22% discount on a ₹40 lakh deal.
What is your standard discount band?
8 to 12%. But this is a real, late-stage prospect. They will sign tomorrow if I approve.
How many of these escalations have you had this quarter, and how many did you approve?
Seven in six weeks. I approved all of them.
Then your salesperson has learned that escalating gets a yes within two hours. That is not an approval system. That is a habit.
He had never run the margin after delivery on those seven deals. He was approving discounts on win probability, not unit economics. He approved this one too.
Six months later
The client was three times the size of his ICP. Implementation needed twice the resourcing, and customer success had to put their best person on it full-time. After six months of servicing, the deal was loss-making.
"I thought I was approving a discount. I was approving a client we should not have signed"
Every discount escalation is four decisions
When a salesperson escalates a discount, the founder hears a pricing question. In fact four decisions arrive at once: should we work with this client at all; are we the right fit for their use case; can we deliver without breaking unit economics; and what does this deal signal to the rest of the pipeline. Answering the first one quietly approves all four.
The Four Mandatory Lines
Client fit score (1–10) against the ICP
How close is this client to the customers you serve well?
Implementation complexity against standard
What will delivery actually take?
Unit economics at the requested discount
Does the deal make money after delivery?
What this deal teaches the next three deals
Precedent for pricing and scope across the pipeline.
Any escalation that arrived without the four lines was returned. Not answered. Returned.
Weeks 2 to 5: the pain, then the turn
His best salesperson — top closer three quarters running — pushed back hard: "This is bureaucracy. We will lose deals." S almost gave in twice, and held the line. In week five the salesperson withdrew his own escalation. Halfway through writing line three he realised the deal would lose money, and told S: "I would not have caught this six weeks ago." That was when the system started working — when the salesperson used it to disagree with himself.
Month 3: what changed
Discount escalations to the founder: down 64%
Average discount on approved deals: 17% → 11%
Gross margin on the quarter's deals: up 8 percentage points
Two deals declined that would have closed under the old system
The line most founders cannot stomach: the system makes you walk away from deals you would have taken last quarter.
Month 6: the founder is out of the deal
S stopped getting 9pm end-of-quarter approval requests. Not because he changed his availability, but because salespeople stopped escalating deals they knew would not survive the four lines. It took 90 days of feeling he had lost control before he realised he finally had it.
You can still approve a deal for the logo. That is a strategic, long-term decision — make it as one, not as tactical annual revenue under deadline pressure.
The fix is not stricter approvals. It is making the salesperson bring you the math, not the pressure
Related: Your Sales Head owns the target. Does he own anything that produces it? — who should be able to approve what.