The marriage of Cognos and Applix has produced its first offsprings, and while the initial announcement is mostly about rebranding, the real integration will start in earnest next year
By Beth Karlin
Now that the dust is settling following the business performance management (BPM) acquisition frenzy, the newlyweds are getting down to business. Leading the way is Cognos Inc., which in mid-December said it has begun drafting an integration roadmap to absorb the Applix products it acquired in September for $339 million. Starting off slowly, Cognos has begun leveraging some of Applix’s TM1 OLAP (online analytical processing) modeling and analytic technology in its Performance Blueprints. The Blueprints are pre-defined data, process and policy models that help customers speed their software deployments and drive faster returns on investment, according to Cognos.
It’s mostly about rebranding now, says Doug Barton, Cognos’ vice president and marketing manager. “We’re changing their colors,” he remarks. But the goal is to make TM1 a data source for business intelligence (BI) capabilities in the mid-2008 time frame. “We’re starting on the journey,” says Barton. “The milestones are yet to come.”
For now, Cognos doesn’t plan to eliminate any of the two companies’ product lines, with Barton noting that the offerings generally are complementary, rather than overlapping. The newest offerings—the TM1 Server, TM1 Excel, TM1 Web and TM1 Executive Viewer—expand Cognos’s line of planning, consolidation, and reporting products and provide new and enhanced resources for interactive business modeling and analytics, the company said. They can be used to assess profitability, price/volume variance and sales mix, among other applications. At the heart of the technology is a 64-bit, in-memory OLAP server.
It’s a three-pronged approach, observes Kathleen Wilhide, who as IDC research director for compliance and BPM solutions, closely follows the fast-paced evolution of business software.
The first step, she says, is providing their customers with enhanced and optimized analytic capabilities supporting their applications. “Second is to augment the current offerings of the Cognos product suite in the areas of planning, budgeting, consolidation and new areas such as profitability,” says Wilhide. “And third, to continue and enhance the TM1 solution, honoring existing development roadmaps as they unfold the integration plan and articulate a vision for a broader set of applications.”
All well and good, say consultants—but will these plans play nicely with those of IBM Corp., which is in the process of acquiring Cognos for $5 billion? Cognos remains mum on the subject. “Those merger and integration plans are being laid right now,” explains Barton. “We can’t comment.”
Cognos isn’t the only business software company dodging questions about long-term plans. With the BPM landscape in constant flux, it’s hard to predict the future for any of the big players.
After all, Cognos is just the latest in a series of companies to give into consolidation. Earlier, SAP AG scooped up Business Objects and Oracle acquired Hyperion. And there’s no end in sight, says Lee Dittmar, a Deloitte Consulting LLP partner and head of the enterprise governance practice. “I wouldn’t be surprised to see a different deal every month for the next 18 months as the giants fill out their industry dance cards,” says Dittmar.
Another unanswered question for now, is how the consolidation trend will affect corporate buying decisions. Many customers have gotten used to picking and choosing bits from different suppliers and melding them in a unique enterprise system. But now, with one-stop shopping for complete systems, will finance executives let the suppliers integrate complete systems for them? Dittmar, for one, thinks customers should let the experts do the legwork. After all, he says, “we all use phones. But do we all want to make them?”
Cognos CEO Rob Ashe thinks not. “Our goal now is to set the market pace with a complete performance management system that enables both operational and financial performance management, underpinned with a market leading business intelligence solution.”