From the October 2010 issue of Treasury & Risk magazine

IBM Buys OpenPages

IBM's September agreement to acquire OpenPages will integrate Big Blue's growing suite of business analytics services to give customers a wide-ranging view of risk across their businesses and consequently a better understanding of how their companies are performing overall. IBM did not disclose the terms of the deal.

Over the past four years, the Armonk, N.Y.-based software and consulting giant has invested more than $11 billion and made more than 20 acquisitions to bolster its business analytics offerings. In fact, a week after the OpenPages deal, IBM announced the acquisition of Netezza Corp., which provides data warehousing analysis tools.

The acquisition of privately held OpenPages pushes IBM's business analytics offering to a new level. OpenPages' governance, risk and compliance (GRC) platform allows companies to aggregate the output of business analysis tools, helping CFOs to more easily identify and manage risks across the enterprise using a single system and develop a view of performance that's adjusted for risk.

"This acquisition fuses strong risk analysis into the broader business and performance analysis that IBM already does really well," says John Hagerty, an analyst at Stamford, Conn.-based consultancy Gartner.

Hagerty notes that IBM competitors Oracle and SAP have built or acquired GRC frameworks over the past several years. IBM's acquisition is part catch-up, he says, but should allow the company to surpass its competitors in risk-intensive industries such as financial services, where OpenPages has focused its efforts recently.

Peter Griffiths, vice president of business analytics at IBM, says the OpenPages platform will remain a distinct offering within the business analytics unit, and its management will become a "core part" of that unit.

Griffiths notes that CFOs are increasingly responsible for strategies to share and manage information across the company. "One of the mainstays of that strategy is how to bring risk information together in a way that's meaningful for the organization," he says.

OpenPages' software models identify risks across an enterprise, as well as excessive risk exposures, and provide reports.

"This can help management trade off risks as a portfolio and move the company to a specific risk profile, and so it can improve the performance and operations of a company," Griffiths says.

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