Callidus Software Inc.

Success at a Glance

Outside of payroll and materials, incentive compensation payments are one of the largest line items on the profit and loss statements of many enterprises. Most organizations spend between hundreds of millions of dollars and even spend upward of $1 billion annually on these incentives, processing millions of transactions to determine the payout to individuals and partner organizations. Successful companies know that finding the right formula is critical to driving sales productivity, revenue and profitability.

Callidus helps global companies meet this challenge. Customer organizations across all industries--including many of the world's largest retail banks, insurance companies and telecommunications providers--use Callidus Enterprise Incentive Management (EIM) solutions to manage incentive compensation and link them to their strategic business objectives. Callidus provides them with the industry's only EIM solution that combines the power and scalability of a grid computing architecture with a flexible, rules-based interface, making it fast and easy for organizations to model, modify and manage their incentive programs.

In 2006, Callidus launched an initiative to bring the full functionality and business benefits of its software to customers through the Callidus On-Demand Solutions. Gartner predicts hosted applications will grow from five to seven percent of IT spend in 2004/2005 to 33-50 percent within five years. Callidus is expecting revenue from its On-Demand offerings to attain 25 percent of overall company revenue within two years.

The new service requires a powerful, secure and highly available computing resource to handle the batch processing of millions of transactions within tight time frames. Hosting the service themselves would have involved large capital expenditures for an infrastructure to meet the peak demands of multiple customers. Recognizing that strategy as too costly, Callidus sought a hosting partner to deliver the needed computing power.

To realize its on-demand vision, Callidus selected the Sun Grid Compute Utility to perform batch processing for its new service. The Sun Grid enables the company to seamlessly extend the underlying grid architecture of its on-premise solution to an on-demand service. Organizations choosing the Callidus On-Demand Solutions immediately benefit from grid computing's number-crunching power to calculate complex compensation rewards with speed and accuracy. Designed for maximum availability and uptime, the Sun Grid is highly reliable and separates databases by customer in order to protect Callidus customers from outages and enhance security.

Customers can now take advantage of Callidus' software without purchasing hardware or adding IT costs, paying only for the computing resources they use. Callidus On-Demand Solutions also provide customers with high levels of security for their proprietary incentive information. In addition, the service can help companies quickly change their incentive management to help meet Sarbanes-Oxley requirements. Customers gain unprecedented business agility, since the service can easily be scaled and modified to meet their changing needs.

Both Callidus and its customers benefit from the business model of the Sun Grid. Since Sun Grid computing is metered, Callidus pays only for the computing power that its customers consume. This allows the company to bill its customers on a per-payee basis, matching cash outflows for computing resources with inflows from customer subscriptions. Callidus clients never need to worry that their new service will grow too quickly to meet their demands.