Targeting Performance Beyond Sales

Why manage just one aspect of your company’s performance when you can have a finger on everybody’s pulse? In what is being seen as a broadening of its horizons, Callidus Software on Thursday announced its intent to deliver Callidus TrueTarget, a module that adds employee performance management (EPM) to Callidus’ existing strength in sales performance management (SPM). TrueTarget will be generally available in the fourth quarter of2008, according to the company.

Callidus TrueTarget will provide management by objectives (MBO) and bonus-management functions. The idea is to extend Callidus’ management reach to all aspects of the enterprise by helping corporate users align behaviors, actions, and tasks of all employees with corporate objectives; the company is branding this unification of SPM and EPM  as Pervasive Performance Management.  

"Organizations increasingly recognize the need for a single, unified pay-for-performance solution that aligns all aspects of their business with corporate strategy," said Steve Apfelberg, senior vice president of marketing and business development at Callidus, in a statement. "TrueTarget extends our reach beyond incentive compensation and sales performance management to Pervasive Performance Management. It is a solution demanded by our customers that draws on our heritage and continued leadership in SPM. It makes us even more relevant beyond sales to entire organizations. TrueTarget is about the behaviors, actions, and tasks that are critical to a business’ performance, making Callidus central to the enterprise balanced scorecard."

"The addition of objectives and bonus management fills in the gaps" for customers seeking a single throat to choke, says Michael Dunne, a research vice president with analyst firm Gartner. It also makes sense as a broadening of SPM functionality. "In some sales agencies, especially those in long-buying-cycle industries, salespeople have objectives by which they can be managed. Selling aircraft engines can take 12 months or more; how do you account for all the work done in that period that isn’t explicitly selling?"

Certain verticals may be more open than others to this approach. "In pharma, salespeople aren’t compensated on direct sales so much as on the influence they have on doctors," Dunne says. Shifting the attitudes of key opinion makers and prescribers is the real job, and it’s much more sensible to manage by objective than by quota. "Callidus also has an ‘in’ with pharma through its work with IMS Health, so there’s a play there whether Callidus planned it or not."

While performance management is hardly new ground to Callidus, the delivery model is: TrueTarget will be pure multitenant software-as-a-service (SaaS), a departure from the company’s traditional installed-code approach. Callidus has hinted in the past that it was considering dipping a toe into multitenancy (its existing on-demand options are single-tenant), and TrueTarget appears to be that toe. "It’s an interesting and pragmatic approach, getting one module under [its] belt," Dunne says. "It’s more an experiment, or a pilot program of sorts. Enterprise performance management is a good first spot to go to."

However, expanding from a tested base of competence always carries risks. "You don’t want to get too vague," Dunne says. "In 'interesting' economic and political times, sometimes it’s smarter to keep an eye on your knitting"—in other words, to focus on your strengths.

That caution extends to the description of the product as well as the market in which it plays. " 'Pervasive Performance Management' may not stick," Dunne says. "You don’t want to confuse or dilute your base. That acronym used to stand for product portfolio management."

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