Worldwide Enterprise Incentive Management Packaged Software Market To Grow 30% Per Annum To Reach $1b By 2010

Worldwide Enterprise Incentive Management Packaged Software Market To Grow 30% Per Annum To Reach $1b By 2010

Independent Study Confirms Strong Growth for Worldwide EIM Solutions Market

Callidus Software, the leader in Enterprise Incentive Management (EIM), today announced the results of a new EIM market sizing study conducted by Evalueserve, a research and analytics company. Results show that the overall worldwide market for EIM solutions was estimated at US$ 3 billion in 2005. This market mainly consisted of home-grown solutions (91%). The global third-party packaged software market for EIM solutions is expected to grow at a Compound Annual Growth Rate (CAGR) of 30% from US$ 275 million to US$ 1 billion by 2010.

“We have examined EIM market growth rates by geography and industry, as well as industry fit. According to our study, the EIM market together with EIM solution providers will experience tremendous growth over the next four years,” said Alok Aggarwal, Chairman of Evalueserve. “Our research suggests that pure-play EIM vendors who have focused on providing the capability to manage highly complex compensation systems will be well positioned to take advantage of the major growth projected in the EIM market. Specifically, we expect the global market for third-party packaged EIM software solutions to grow at a CAGR of 30% during the years from 2005-2010.”

“The results of the EIM market sizing study validate Callidus Software’s approach to the EIM market,” said Shanker Trivedi, senior vice president and CMO of Callidus Software. “The market shows exceptional growth compared to other markets, such as CRM and ERP. Companies across all industries recognize the huge value that best-of-breed packaged EIM software brings to their organizations. It helps them to align sales with corporate objectives, drive revenue and increase shareholder value.”

Highlights from the research of industry-specific projections show the following growth rates and opportunities for leading industries using EIM solutions:
• 34% Growth in Insurance Industry – EIM solutions are primarily driven by bonus and commission payouts, but there is also a projected increase of insurance sales agents through 2014 that will boost EIM expenditures
• 26% Growth in Retail Industry – an increased need for EIM solutions due to complex supply chains, a large number of transactions and the growing number of retail salesperson jobs
• 25% Growth in High-Tech Industry – supported by implementation of EIM solutions in many companies, due to the complex distribution structures, compensation plans and growing sales force
• 11% Growth in Telecom industry – resulting from increased sales force, retail outlets and variety of tariff plans complicating incentive payment management

Callidus Software’s best-in-class EIM solutions provide tangible business benefits to today’s leading enterprises. Its solutions allow companies to drive revenue and increase shareholder value by improving new product time to market. Customers also benefit from aligning sales with corporate objectives and focusing selling time among the sales distribution channels. The effective use of incentive compensation budget dollars maximizes a company’s market potential, motivates the sales force and provides better visibility into sales performance. Companies using Callidus Software’s solutions experience productivity improvements. Using this technology, they can significantly reduce compensation errors, payment redundancy and error-prone manual systems.

Please download a full copy of the study at http://www.callidussoftware.com/go/06/market-study.jsp.

About Callidus Software
Founded in 1996, Callidus Software (www.callidussoftware.com) is an industry leading Enterprise Incentive Management (EIM) provider to global companies across multiple industries. Callidus’ EIM systems allow enterprises to develop and manage incentive compensation linked to the achievement of strategic business objectives. Through its TrueComp® Grid architecture, Callidus delivers the industry’s only EIM solution that combines the power and scalability of grid computing with the flexibility of rules-based interface. Customers/Partners include 7-Eleven, Accenture, CUNA Mutual, HP, IBM, Philips Medical Systems, Sprint Nextel, Sun Microsystems, Time Warner Corporation and Wachovia. Callidus is publicly traded on the NASDAQ under the symbol CALD.

Note on Forward-Looking Statements
The forward looking statements included in this press release, including that the global third-party packaged software market for EIM solutions will grow tremendously in the next four years with a CAGR of 30% through 2010, that pure-play EIM vendors will be well positioned to take advantage of the EIM market growth, that the Evalueserve study validates Callidus’ approach, that companies using Callidus’ software solutions experience productivity improvements including a significant reduction of errors, redundancies and manual systems, reflect management’s best judgment based on factors currently known and involve risks and uncertainties. These risks and uncertainties include, but are not limited to, timing and size of software license orders, management’s ability to successfully implement its business plan, changes in executive management, potential material fluctuations in financial results and future growth rates, decreases in customer spending, increased competition or new entrants in the marketplace, litigation and other risks detailed in Callidus’ reports filed with the Securities and Exchange Commission (SEC), including its Form 10-K and Form 10-Qs, copies of which may be obtained by contacting Callidus Software’s Investor Relations department at 408-808-6577, or from the Investor Relations section of Callidus Software’s website (www.callidussoftware.com). Actual results may differ materially from those presently reported. We assume no obligation to update the information contained in this release.

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