Business Objects Acquisition Signals Performance Management Ambitions

With SRC acquisition, Business Objects is more talkative about its performance management ambitions

Business Objects SA is one of the biggest players in the business intelligence (BI) space, but unlike arch-competitors Cognos Inc. and Hyperion Solutions Corp., the company may not be the first vendor that comes to mind when you think of performance management software.

That may soon change. Last week, Business Objects acquired privately-held SRC Software, a provider of budgeting, planning, and financial consolidation software. SRC doesn’t have an abundance of name recognition, but it’s a solid performer, with 135 employees, more than 1,200 customers, and 440 percent growth over the past five years. It gives Business Objects much greater penetration into specific verticals, with custom-tailored solutions for the banking, insurance, retail, health care, hospitality, and leisure industries.

With the $100 million acquisition of SRC, Business Objects is talking more explicitly about its ambitions in the performance management arena—a space in which, company officials stress, it’s always been a first-tier (if less well-known) vendor.

“Certainly, a big part of our company strategy over the last couple of years has been to cement our leadership in our core business intelligence market,” says Lance Walter, vice-president of product marketing for Business Objects. “Certainly one of the drivers has been performance management, business performance management, financial performance management—whatever you call it, it’s a category that has driven a lot of growth for Business Objects in terms of providing dashboards, KPIs, etc.”

Thanks to the financial planning, budgeting, and consolidation software that SRC brings to the table, Walter argues, Business Objects will be an even more competitive—and possibly more overt—competitor in the enterprise performance management space.

“Certainly we think this acquisition fits pretty neatly into our performance management strategy,” he says, noting that SRC is a long-time Business Objects partner that has already certified its applications for use with the company’s Business Objects XI BI suite. In this respect, Walter notes, the product lines are highly complementary.

Eventually, he says, SRC’s applications will be folded into Business Objects’ flagship BI stack. Right now, the SRC stack mostly consists of Excel-based tools that are designed for financial analysts and other heavy Excel users. SRC currently supports most major relational databases, including SQL Server and Oracle.

In the Business Objects’ lexicon, the term “universe” describes a common metadata layer that facilitates (meaningful) integration between and among Business Objects (and now Crystal) applications. The good news, at least with respect to the SRC technologies, is that much of this universe integration work has already been done, so, for example, joint customers can currently generate reports from Business Objects using SRC.

Because of these factors, and the company’s demonstrable success in integrating its Acta (ETL) and Crystal Decisions (enterprise reporting) acquisitions, industry watchers such as Mike Schiff, a senior analyst with consultancy Current Analysis Inc., give the SRC purchase a thumbs-up.

SRC might not be the best known company, says Schiff, but its technology will almost certainly help to make Business Objects a more visible competitor to Cognos and Hyperion in the performance management space.

“Although Business Objects has long offered a ‘Build and Buy’ strategy with both integrated tools and analytic applications, it did not have the breadth of planning, budgeting, and consolidation solutions that some of its competitors offered for the enterprise performance management market,” he writes. “These capabilities were, however, offered through partners such as SRC Software. With this acquisition, Business Objects, while somewhat late to the game, is making these capabilities its own, thus increasing its overall competitiveness.”

All’s not completely sunny side up, says Schiff. The acquisition of a long-time partner could alarm other Business Objects partners, several of which have built similar performance-management solutions on top of the company’s analytic stack. Furthermore, Schiff notes, Business Objects has in the past criticized competitors for focusing on the performance management space; now that the BI giant has more clearly articulated its own performance-management ambitions, these comments could come back to haunt it.

Walter, for his part, says the acquisition is not a reversal of course. “It’s definitely a logical step in our evolution. It certainly rounds out the performance management piece, which is a key growth driver for us.”

About the Author

Stephen Swoyer is a Nashville, TN-based freelance journalist who writes about technology.

Must Read Articles