Callidus' SAP Deal Could Bring It Momentum

Includes: CALD, SAP
by: Tom Taulli

The past few years have been tough for enterprise software developer, Callidus Software (Nasdaq: CALD). But with a new CEO, Robert Youngjohns, things are perking-up. Actually, he has more than 30 years experience in the software industry, having been a senior executive at Sun (Nasdaq: SUN).

On Tuesday, the company announced a deal with SAP (NYSE: SAP), which calls for a cooperative development arrangement as well as co-promotion and marketing of Callidus’ products.

Over the past ten years, Callidus Software has been developing so-called Enterprise Incentive Management (NYSEMKT:EIM) applications. Basically, such technologies help customers effectively deal with its incentive compensation structures, especially for the sales force.

No doubt, for large organizations, there is often inefficiencies in compensation structures. Also, the compensation may not properly motivate key employees.

But, with Callidus, a company can get much more visibility and effectiveness from its compensation structures.

While the market is potentially large, it is not easy to penetrate. Often, it means integrating with massive ERP systems.

Yesterday I talked to Shanker Trivedi, who is the CMO at Callidus. According to him: “We’ve spent much time working with SAP technologies. Now, our product is seamless to the customer.”

So, by linking up with SAP, Callidus should get much more traction in its business. And, by leveraging some of its distribution, it should add to the momentum.

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