In the News this Week…

ForceLogix Announces the Release of New Sales Performance Management Coaching Solution
ForceLogix, the leading provider of sales performance management optimization solutions, has released a best in class sales coaching module designed to support all sales methodologies worldwide.

Callidus Software Inc (NASDAQ:CALD) to Present at Wedbush Morgan Securities Management Access Conference for Micro-Small-Mid-Cap Companies
Callidus Software Inc (NASDAQ:CALD) will present at the Wedbush Morgan Securities Management Access Conference for Micro-Small-Mid-Cap Companies on Wednesday, May 21 at 12:00 pm. Interested parties may access the presentation by registering for the event at wsw.com/webcast/wedbush6/register.aspx.

Xactly Wins 2008 CRM Excellence Award
Xactly Corporation, the leader in on-demand sales performance management, today announced that Technology Marketing Corporation (TMC)’s Customer Interaction Solutions(R) magazine has named Xactly’s flagship application, Xactly Incent, a recipient of the 2008 CRM Excellence Award.

Dreamforce Europe: Benioff, Cloudy CIOs and sophisticated Europeans
Salesforce.com’s inaugural European user summit landed in London this week. It was an important gig for the software as a service firm and attracted over 2,000 attendees. So how did it fare?

Upcoming Webinar:
Ventana Research: Sales Performance Management: Improving the Performance of Sales Organizations to Maximize Strategic Value
Here are some key questions that will be addressed in the research:
• What helps organizations improve maturity of their sales organizations and processes.
• Where organizations are investing into information and metrics to improve sales performance.
• Why the reliance on spreadsheets in 47% of companies are a problem and 51% rank scattered information as top impediment to improving sales performance.
• What are the top systems that are required to integrate with sales compensation and operations.
• What is the role of finance and executives for adopting sales performance management.

New Blog:
The Management Curve – How Technilogy is Changing the Way Sales is Managed
The Management Curve is a blog by Paul McCord about technology and the change it is currently and will continue to bring about in how salespeople and the sales function are managed.

Recession is Brewing… Impact on Sales Performance Efforts: Part I of III of my Interview with Callidus

I had a very insightful conversation yesterday with Paul Turner and Jock Breitwieser from Callidus Software. We talked about several topics and I will share their insight in my next few posts.

Paul Turner is Director of Product Marketing at Callidus Software. He has over 13 years experience in enterprise software focusing on sales and business performance management, business intelligence and incentive compensation. Prior to joining Callidus, Paul was Director of Product Marketing at Hyperion Solutions. Paul holds a BSc in Computer Science from Lancaster University, England.

Jock Breitwieser is the Director Public and Analyst Relations at Callidus Software. He has extensive experience in public relations with a strong international background and expertise. Before joining Callidus, Jock was an account manager at The Hoffman Agency.

I recently read several articles talking about the impact of a slow-down in economy on sales performance efforts, both from a SaaS and CRM/On-premise perspective. I used this occasion to bombard my two guests with questions on this topic and several good arguments came out of the conversation.

General Thoughts on the ICM Market:

• The selling point of ICM solutions is to achieve a good return on investment.
• Measuring the actual return on investment can be hard to do, but looking at the potential cost savings alone can justify a sales performance system.
• With a proven Return on Investment, ICM solutions can be justified regardless of market conditions.
• A slower market can actually contribute to an expansion of the Sales Performance Management market.

Market outlook for Callidus SaaS Offerings:

• While Forrester predicted a slow down in the SaaS market, Callidus has seen phenomenal growth in this area – In Q4 of 2007, Callidus On-Demand annual contract value (ACV) increased 150% to $.6 million.
• Callidus has also seen a much greater adoption of their on-demand solutions by enterprises of all sizes including Incentra and Lenovo.
• The integration of key Callidus components with SalesForce.com is also an aspect which encourages small to medium-sized businesses to adopt Callidus as their Sales Performance Management system.

Market Outlook for Callidus On-Premise Offerings

• Callidus continues signing on new clients and growing in this area.
• In 2007, overall revenues were up 35% vs. 2006 ($100 million versus $76 million).
• License revenues were also up by 3% to 28.6 million.
  With the acquisition of Compensation Technolgies, Callidus will generate additional consulting revenues from Callidus implementations and adds new offerings for strategic services.

Additional Thoughts

• Callidus recently announced more growth in the European market. They have increased their headcount to 50 employees in the Europe, Middle East and Africa (EMEA) region.
• Callidus has also opened a new EMEA headquarters in London.
• Getting more clients in Europe offsets the lower US dollar.
• One notable new client is npower, a leading UK energy company.

Overall, Paul and Jock were very upbeat about what is coming up in 2008, both from a Callidus perspective and for the Sales Performance industry in general.

[Part II of III of my Interview with Callidus]
[Part III of III of my Interview with Callidus]

SAS70 Audit for On-Demand Sales Performance Applications

There are tons of resources about SAS70 and Sarbanes-Oxley on the web.

In a nutshell, SAS 70 is a Statement on Auditing Standards (SAS) for service organizations, developed by the American Institute of Certified Public Accountants (AICPA). It demonstrates that a firm has proper controls and processes to protect the data belonging to their customers (very important!). The SAS 70 report is issued by an independent auditing firm and includes the auditor’s opinion on the service organization’s controls. A SAS 70 report is particularly important since it is the preferred method of providing assurance for service organization clients subject to Sarbanes-Oxley Section 404.

These days, service organizations enjoy talking about their Type I and Type II SAS 70 reports when it comes to marketing their applications. A type I report includes the auditor’s opinion regarding to which extent the organization represents its controls, and their description. A type II report includes all the info in the type I report, plus the auditor’s opinion on how effective the controls are during a defined period.

This being said, according to the SAS 70 website and other online resources, “SAS 70 does not specify a pre-determined set of control objectives or control activities that service organizations must achieve”. This means that customers need to review the disclosed controls and ensure they are sufficient to meet their objectives and their own auditor’s requirements. It also means that a SAS 70 report does not guarantee data security.

More detailed information about SAS70 can be found on the SAS 70 website, on Wikipedia and from Deloitte.

How do Sales Performance Management Systems Stack Up?
As I mentioned above, since SAS 70 does not prescribe which controls should be used, it is not possible to compare SPM / EIM vendors. However I tried to find as much information as possible with respect to SAS 70 certification for every vendor.

Callidus

SAS 70 Type:	“Meets SAS-70 compliance”
Controls:	N/A
Sources:	Link 1
Comments:

Centive

SAS 70 Type:	Type II
Controls:	N/A
Sources:	Link 1
Comments:	Completed January 2008

EIM Software

SAS 70 Type:	“Guaranteed SAS-70 compliance”
Controls:	N/A
Sources:	Link 1
Comments:

SalesForce.com

SAS 70 Type:	Type II
Controls:	N/A
Sources:	Link 1
Comments:	The article dates from 2004

Synygy

SAS 70 Type:	“Completed SAS Audit”
Controls:	N/A
Sources:	Link 1
Comments:

Varicent

SAS 70 Type:	N/A
Controls:	N/A
Sources:	Link 1
Comments:	SAS70 Type II data center

Xactly

SAS 70 Type:	Type I
Controls:	Full redundancy throughout the production infrastructure, regular security patch updates, on-going evaluation of potential security threats
Sources:	Link 1 Link 2
Comments:	SAS70 Type II data center