In order to tap into the enterprise incentive management (EIM) market in financial services, estimated by Giga Information Group to grow at a compound annual growth rate of 40 percent through 2005, Callidus Software has partnered with IBM.
"In some cases, insurance companies are mis-paying incentives five to 10 percent of the time," says David Port, vice president of business development, at Callidus (San Jose, Calif.). "That amounts to millions of dollars."
By partnering with IBM (Armonk, N.Y.), Callidus will benefit from the firm's insurance-specific experience. "If it was just installing software, we could do it," says Chuck Johnston, director of industry marketing. "When it comes to replacing a compensation system, that is where IBM comes in."
IBM also recognized the potential for the EIM market, comments Bill Pieroni, general manager, global insurance industry, at IBM. "Managing the distributors is becoming increasingly important, and even in a hardening market there is a large focus on incentives as insurance companies are looking to motivate" the sales teams, Pieroni says. "Insurers are finding that home-grown solutions are not easily adapted to market conditions."
Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio