Optimizing Sales Operations with Sales Performance Management

Christopher W. Cabrera, Xactly Corporation

Joanna Bloor, CNET Networks

Sam Chung, Salesforce.com

Sales: Operations & Performance

Safe Harbor Statement

“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements including but not limited to statements regarding our expected future revenue, GAAP diluted earnings per share, expected tax rate, anticipated shares outstanding,and concerning the potential market for our existing service 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, including our Form 10-K for the fiscal year ended January 31, 2007. 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.

Christopher W. Cabrera

Founder, President & CEO

ccabrera@xactlycorp.com

About Xactly Corporation

• INDUSTRY: Software

• EMPLOYEES: 100+

• GEOGRAPHY: Global

• # CUSTOMERS: 100+

• PRODUCT(S) USED: ALL

Xactly Corporation is the market leader in on-demand sales performance management. The company’s flagship product, Xactly Incent, enables sales and finance executives to design, implement, manage, and audit sales compensation management programs easily and affordably. Xactly helps companies improve operational performance, optimize sales effectiveness, proactively manage risk and compliance and maximize profits.

Xactly Customer Success

Sales Performance Management: Four Core Process Components

Monitoring and Analyses

TerritoryManagement

Sales ICMQuota

Management

What's Going On?

What to Expect?

How Am I Goingto be Rewarded?

What's My Role?To Whom do I

Sell?

What do I Need to Sell and How

Much?

Source: Gartner

QuotaTerritory

PriceExecution

Forecast/Planning

Reporting& Analytics

Workflow

SalesComp

Rewards &Incentives

CreditAssignment

On-Demand Sales Performance Management

BusinessData

QuotaTerritory

PriceExecution

Forecast/Planning

Reporting& Analytics

Workflow

SalesComp

Rewards &Incentives

CreditAssignment

BusinessData

On-Demand Sales Performance ManagementCustomer-driven Product Development

Flexible, rules-based compensation engine Intuitive compensation plan design, implementation and maintenance Real-time visibility into incentive compensation plans: commissions, bonuses,

draws, SPIFs Real-time “what if” calculations Web-based reporting for the entire organization Plan Document and Certification Letter configuration, routing and tracking Deep integration with Salesforce.com

Benefits• Increase profits• Increase sales

effectiveness• Gain competitive

advantage• Reduce TCO• Comply with

Sarbanes-Oxley

Xactly Commissions Mash-up with Salesforce

Use Incentive Compensation Management toAlign Payments to Performance

Large snack food distributor

initiating discounting ‘on-the-fly’

based on seasonality

Midwestern storm forecast

significantly increases snack

food demand and consumption

Retailers creating targeted

incentives for snack food sales

on seasonal basis

Augment Cash Incentives with Non-Cash Rewards Automate Sales Contests

Motivate and drive performance and achievement across teams Issue Reward Points for SPIFs and contests Up-sell & cross-sell campaigns Greatest selection of value-oriented tangible rewards

Eight Requirements for Effective Sales Performance Management

Secure, hosted repository with actionable post-sales business data

1

Intuitive compensation plan design, implementation and maintenance2

Rich analytics, reporting and dashboards for sales and finance analytics3

Ability to model and forecast compensation plan changes in advance of implementing 4

Integration with CRM applications for visibility and insight into sales opportunities in the pipeline5

Ability to automate quota allocation and analysis based on territory goals6

Optimize pricing strategy and execution by identifying and analyzing what products have been sold7

Motivate and reward performance through automated sales contests and SPIFs with non-cash rewards8

Joanna Bloor

AVP Sales Operations

Joanna.Bloor@cnet.com

Who is CNET Networks?

Commissions Were…

What Were We Trying to Solve?

For the Sales People

For the Sales Management

For the Sales Operations

For the Finance Organization

Why Was All of This So Challenging?

Complicated Compensation

Plan

Complicated Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

More Calculations

How Has Xactly Helped Us Out?

Automated Document Approval

Compensation Visibility

Individual

Team

Company

Implementation

Application

Support

What’s Next For Us?

Compensation Modeling

Integration with HR tools

Non-Sales Compensation

Simplify our compensation plan

Incentive Estimator

Sam Chung

VP Finance Systems & Compliance

schung@salesforce.com

About Salesforce.com

• INDUSTRY: Software

• EMPLOYEES: 2000+

• GEOGRAPHY: Global

• # USERS: 2000+

• PRODUCT(S) USED: ALL

Salesforce.com is the worldwide leader in on-demand customer relationship management (CRM) services. Salesforce.com is constantly building on that legacy by improving and expanding our award-winning suite of on-demand applications, our Apex platform for extending Salesforce, and our one-of-a-kind AppExchange directory of on-demand applications.

Key Challenges

Business Challenges

• How do I implement a Sales Compensation system that will:

• Allow me to deploy sooner than 2 years from now?

• Reduce my manual touch points?

• Standardize my processes worldwide?

• Accommodate for additional design flexibility in the future?

• Integrate with our Order Management application?

The Solution

How did we address these challenges?

• Deployed Xactly Incent

• 9 month worldwide deployment

• Migrated to Orders-based compensation model

• Tight alignment with bookings/revenue event

• Replaced Calculators with Rules Configurator

• SFDC Custom Object to integrate to Xactly

• 1st Object built entirely using Apex Code

The Solution – Process Architecture

AE

Create Oppty

Activate

Order

Contract

SalesOperations

EditOppty

MicrosoftAccess®

DatabaseOpportunity

Custom Object

AmortizationEngine

GeneralLedger

manual

manualMicrosoft

AE

Benefits

No more manual time bombs

• Let Xactly calculate commission basis

No more Microsoft AccessTM

• Replace custom queries with Rules Configurator

No more disparate processes

• 1 system, worldwide, for Sales Compensation

No more restrictions on comp design

• Order line-level design options are possible

No more disconnects with Sales transactions

• Determine commissions off of Orders, not Opptys

What’s Next

Deploy Xactly’s AppExchange App

• Real-time visibility for Sales

• Case Management

• Incentive Estimator

Utilize Web Services

• Crediting through daily data transfers

Deploy Xactly Analytics

• Enhanced reporting for Sales and Finance

Distribute and Accept Plans Using Xactly

Obtain SAS 70 Type II Report for Xactly Incent

Christopher W. Cabrera

Founder, CEO & President

Sam Chung

VP Finance Systems & Compliance

Joanna Bloor

AVP Sales Operations

QUESTION & ANSWER SESSION

Winner – Apple iPhone