Synygy Undertakes Aggressive Expansion Program; 'The Incentive Compensation Company' develops an untapped $10 billion market

Business Wire, July 18, 2000

Business Editors/Hi-Tech Writers

BALA CYNWYD, Pa.--(BUSINESS WIRE)--July 18, 2000

One of the fastest growing companies in the nation for the past three years, Synygy Inc., The Incentive Compensation Company(TM), today announced that it has embarked on an aggressive expansion program designed to drive its continued leadership in the emerging incentive compensation management market.

Synygy is making strategic investments in sales, marketing, client operations, and continued development of its IC Expert 7.0 incentive compensation management software and related services.

"Our strong growth clearly shows that incentive compensation management is emerging as a major strategic business issue, one that has been largely overlooked by most companies," said Mark Stiffler, president and CEO of Synygy.

Founded in 1991, Synygy has seen its revenue grow at a rate of over 75 percent per year. Synygy's revenue now exceeds $20 million annualized, making it the largest company focused on the fast-growing market for incentive compensation management solutions.

Yet, with the potential global market for incentive compensation management solutions estimated by analysts at the Aberdeen Group to exceed $10 billion annually, Synygy has just begun to scratch the surface of this large untapped market.

There are many reasons driving the growth of this emerging market. One is that incentive compensation is not just for sales representatives anymore. Forty percent of all companies now offer some form of incentive compensation to all employees.

A recent study by Towers Perrin conclusively demonstrated that rewarding and retaining high-performance employees is linked to strong company performance in the stock market.

"Another is the increasing complexity of plans," commented Stiffler. "With more non-sales employees covered by variable compensation, and with e-commerce creating new sales channels, incentive compensation plans are becoming much too complex to manage with home-grown spreadsheets or hard-coded legacy systems. Our customers have discovered that a properly managed plan can be used to better execute the corporate strategy and drive increased revenue."

Nationwide Sales Force

The most significant aspect of Synygy's expansion program is the building of a nationwide direct sales force, placing over forty new sales executives and solution specialists in 20 cities throughout the U.S. This new sales organization is to be managed by a vice president of sales and three sales directors in regional offices in Phoenix, Chicago, and Philadelphia.

The new salespeople are being put through an extensive sales "boot camp" to train them in Synygy's methods, markets, and messages.

"Much of our growth so far has come through word of mouth, where a customer likes our work so much they refer us to their associates at a subsidiary or another company," said Stiffler. "This has enabled us to become the largest company in the incentive compensation management marketplace. With our shift from word of mouth marketing to a forty-plus sales organization, we expect to be able to leverage this great customer advocacy to grow even more quickly."

Greater Emphasis on Marketing and Alliances

At the beginning of the year, Synygy launched a major marketing campaign to raise its profile in the marketplace, with a ten-fold increase in advertising, direct mail, and public relations.

"Our 'Hi Tom' ad campaign, launched in January," said Stiffler, "humorously points out how addicted companies are to doing things the old way. The response has been tremendous, with a 1000% increase in the number of qualified prospects in our sales pipeline."

The past year has also seen an increase the number of alliances and cross-selling relationships with other companies.

"Our relationships with companies that design incentive compensation plans--such as Sibson & Company, William M. Mercer Co., HayGroup, Towers Perrin, and Hewitt Associates--have led to a number of important new contracts," commented Stiffler. "Consulting companies have existing client relationships and do excellent plan design work. Their partnership with Synygy ensures the successful implementation of the plans they design."

Growth of the Company

Synygy began the year with 165 employees, and grew to 250 employees in the first six months of the year, with a planned total of over 400 by the end of the year.

"We watch our business very closely, and our business model showed that we would need to invest heavily in recruiting and training, especially in middle management, in order to handle the demands for our software and services," concluded Stiffler. "So far we've been able to meet our goals on all levels and expect to be able to meet these demands while at the same time maintaining the high level of satisfaction that our clients have come to expect from us."

About Synygy

Synygy Inc. (www.synygy.com), The Incentive Compensation Company(TM), is the largest provider of incentive compensation software and services. Synygy's IC Expert 7.0 software has been used to implement and manage more incentive compensation plans for more plan participants for more of the world's largest corporations than any other solution.