When the early niche EIM / SPM solutions were being introduced over ten years ago, the low end of the target market began with companies having about 100 sales representatives. These solutions, with their sizable implementation schedules and server hardware and software requirements, were just not economically feasible for companies with smaller numbers of sales personnel; Excel or Access based custom solutions were the standard alternative. Some customers did better than others with these solutions there are some pretty amazing Excel spreadsheet based systems out there. Often though, the sustainability of such solutions relied on an Excel guru and growth bred havoc leaving the typical SMB in a difficult place.

Software vendors recognized they were neglecting the SMB market and have taken steps to address this with off premise solution options. All of the niche solution providers including Callidus, Centive, Synygy, and Varicent are offering such solution options. Additionally there are pure-play providers including Xactly and nGenera which only offer off premise EIM solutions.

What is an off premise solution? Rather than paying licensing fees to run the software on its own hardware, the customer pays a subscription (usually based on the number of payees for EIM software) to use software running under the vendors control. Savings can be realized in this arrangement through the more optimal use of the following resources:

  • Support personnel
  • DB software
  • Application server software
  • Hardware

The solution vendor whose core business is EIM should be able to achieve levels of efficiency much higher than that of companies trying to support their own solution in addition to managing their core business.

The various vendors have different delivery architectures for these off premise solutions. Some merely implement instances of their software on servers and databases very much like a customer might do with an on premise solution; this arrangement is often described as a hosted solution. Others share more resources amongst their customers including databases, servers, and even instances of the software; as more resources are shared, the solutions are more often described as software as a service (SaaS) (think SalesForce.com, QuickArrow, etc.). SaaS purists draw a distinction between the way the solutions are delivered; some even refuse to describe a hosted solution as SaaS. Wikipedia quotes Microsoft’s classification of SaaS maturity levels. Each of these ascending levels of maturity allows for greater levels of resource sharing, efficiency, and maintenance cost savings. Theoretically, a vendor offering a solution based on an architecture with a higher maturity level can do so at a lower cost than those with a less mature architecture. Generally, at a tradeoff of higher maintenance cost, a solution that leans towards hosted rather than highly mature SaaS can offer greater customization. Some vendors offering solutions more towards the hosted end of the spectrum promote this as a benefit claiming that sharing fewer resources amongst customers (especially database resources) allows a level of data security that true SaaS providers sacrifice.

If you have fewer than 100 sales representatives and you thought EIM software was beyond your budget, it may be time to reconsider. An off premise solution may lower up front and maintenance costs making serious EIM realistic.

-Michael Stus

Clarification: Centive offers only a SaaS solution, Centive Compel, after divesting its on premise product known as CompCentral in September 2006. Thanks to Bob Conlin, Centive Chief Marketing Officer, for fact checking. In addition to emphasizing his company’s SaaS focus, Mr. Conlin pointed out that Compel was the first true multi-tenant solution to come to market launching in May of 2005. -AC, 9/24/2008