Xactly Dreamforce Presentation 11 16 09

Xactly Breakout

Track: The Behavioral Power of Incentives

Christopher W. Cabrera Founder & CEO, Xactly Corporation

Marisa Massie Sr. Director, Global Compensation Salesforce.com

Safe Harbor Statement

“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995: This presentation may contain forward-looking statements including but not limited to statements concerning the potential market for our existing service offerings and future offerings. All of our forward looking statements involve risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions proves incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

The risks and uncertainties referred to above include - but are not limited to - risks associated with possible fluctuations in our operating results and cash flows, rate of growth and anticipated revenue run rate, errors, interruptions or delays in our service or our Web hosting, our new business model, our history of operating losses, the possibility that we will not remain profitable, breach of our security measures, the emerging market in which we operate, our relatively limited operating history, our ability to hire, retain and motivate our employees and manage our growth, competition, our ability to continue to release and gain customer acceptance of new and improved versions of our service, customer and partner acceptance of the AppExchange, successful customer deployment and utilization of our services, unanticipated changes in our effective tax rate, fluctuations in the number of shares outstanding, the price of such shares, foreign currency exchange rates and interest rates.

Further information on these and other factors that could affect our financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time. These documents are available on the SEC Filings section of the Investor Information section of our website at www.salesforce.com/investor. Salesforce.com, inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Xactly – The Smart Incentives Company

  Leader in SaaS sales performance management

  Founded in 2005

  Strong domain experience

  Managing >$4 billion in compensation annually

“Show me a company’s various compensation plans, and I’ll show you how its employees behave.”

- Jack Welch Former Chairman and CEO, GE

Helping companies of all sizes Incent Right.

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™

Incent Right.

  No Excel – reduce errors & manual processes

  Sox compliance & security

  Web-based, real-time visibility

  SPIF’s, contests and rewards

  Pay differently (i.e. margin, discount, cross-sell/up-sell, terms, etc.)

  Model to understand exposure

  Analyze to ensure effectiveness

  Integrated to Salesforce CRM

© CSO Insights -Confidential

•  Largely manual process

Why is it so hard to Incent Right?

Sales Reps can be Singularly Focused

Getting Them Focused on the “Right” things is Difficult


Productivity is hurt when reps don’t understand their plans

Productivity is hurt when companies over-simplify plans

Change the Paradigm

How Frequently Do Companies Pay?


Productivity is negatively affected when there is too much time between the effort and the payment

How Frequently Do Companies Change Plans?


Productivity is negatively affected when companies do not modify The comp plans to address changes in market conditions, product

Launches and/or competitive threats

How often Do Companies Run Contests and/or Special Performance Incentive Funds (SPIFs)?


Productivity is improved when companies tap into the competitive DNA Of sales people with contests and non-cash rewards.

Hundreds of Companies Experiencing the Benefits

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Xactly and Salesforce.com

Changing Behavior One Rep at a Time.

Marisa Massie Sr. Director, Global Compensation

The Evolution of a Sales Organization

Phase I Start-Up

Phase II Volume Growth

Phase III Re-Evaluation

Phase IV Optimization

Base Growth

High Growth

Low Growth

• Cash Flow •  “Sell or Die”

• Get New Customers

• Keep Customers

• New Products

• Protect Base • Price Mgmt • Reduce Costs

- Growth

• New Value Proposition

• New Markets • Specialization

Source: The Alexander Group (AGI)

Three Key Levers that Changed Sales Behavior

Moving these levers will change behavior !

Selling New Products

Everyone Wins

Contract Length

Longer, but not too long

Team Selling

Cross-functional collaboration

Lever 1: Selling New Product Incentives

RESULT “In Q2, our service cloud and custom cloud services once again

represented more than 25% of new business signings. The Service Cloud logged another record quarter in Q2, with new business in the quarter up more than 175% from a year ago”

Incent *every* sales person to sell Service Cloud

GOAL / DESIRED BEHAVIOR

We have enabled significant product growth in our Service Cloud offering by applying:

–  Product-SPIFs: Incent on every deal

–  Reward team achievement

–  Product-specific quotas

APPROACH

RESULT -80% of team on target to achieve quota - Exploring global expansion in next year

GOAL / DESIRED BEHAVIOR APPROACH

Lever 2: Team Selling

Drive adoption in subsidiaries with mid-to-small company skills to focus on subsidiaries

Encourage cross-functional teamwork

Compensate multiple teams on same deal

Compensate both large account and mid- market teams to incent teamwork.

RESULT •  Maximize compensation for target contract length •  Discourage 6+ year contracts that come with deep discounted pricing

GOAL / DESIRED BEHAVIOR APPROACH

Lever 3: Key Deal Elements – Contract Length

Incent longer-term contracts by 25%, but maintain price

Xactly has enabled us to easily adjust incentives for contract length

Incent later years of contract at different rates

How does Xactly help us meet these needs?

  Integration with salesforce –  Just another tab

–  Daily API of all closed deals

–  Drill down capability

  Flexibility / Ease of Use –  Incent provides the ability to respond to

market changes to drive the desired behavior

  Scalability –  Global – access, currencies, 24x7

–  Plan elements (SPIFs, coverage model)

  Customer Service –  Never missed a deadline because we couldn’t find the right person

–  Stay up with us until 2am

Doubled sales team and at 20 countries, added 1 analyst in 2 years

99.5% payment accuracy

Fully SOX Compliant for 2 years

The Process Starts with the Data

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Completely Integrated with Salesforce CRM

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On-Demand Sales Performance Management

>50 different currencies 18 different languages

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Xactly Incent 5.0 for the Enterprise

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•  Personalized Sales Dashboards •  Enhanced global customer

support with Unicode •  New Business unit security •  New Territory management &

credit assignment •  Increased scalability

Stop by and Preview

Xactly Incent on the iPhone

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And the Winner is…

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http://twitter.com/xactlycorp

http://www.facebook.com/XactlyCorp

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www.xactlycorp.com