Performance Time

The new Cognos-Adaytum combination ups the performance management ante

With its $160 million acquisition of Adaytum Inc., the small but well-regarded enterprise performance planning company Cognos has heated up the strategic IT solutions provider arms race in the dynamic performance management market.

Cognos CEO Ron Zambonini characterizes the acquisition as a "bold stroke" that will accelerate his company's execution of performance management initiatives by 18 months. "We now have all the pieces," he says.

Founded in the United Kingdom by former New Zealand army captain and current CEO Guy Haddleton (today the company is headquartered in Minneapolis), Adaytum has parlayed real-time collaborative modeling technology originally developed at IBM into 1,500 customers. The company is widely considered a best-of-breed player in the enterprise performance planning area and was named a "Company to Watch" by Intelligent Enterprise for 2003.

Cognos executives identify enterprise-class scalability and market presence as Adaytum's most attractive assets. According to a company official, Adaytum is the world's fastest growing enterprise performance planning software company in the last half decade; its impressive mind share among finance departments is expected to improve the penetration of Cognos corporate performance management solutions in that community.

Cognos' first order of business will be to integrate and rationalize its newly broadened performance management portfolio. Although Zambonini stresses the complementary nature of Adaytum's ePlanning product and the budgeting-focused Cognos Finance package, it's likely that functionality will consolidate between the products over time. (The company also recently announced that it replacing Cognos Planning with Adaytum's product, although future releases may include Cognos Planning functionality.) Furthermore, Cognos is moving quickly to replace the Business Objects reporting functionality in ePlanning with PowerPlay, and is reportedly offering free upgrades to current Adaytum customers.

Cognos joins Hyperion Solutions Corp. and SAS as business intelligence (BI) solution providers offering suites that span BI, planning and scorecarding, and financial operational processes (with varying degrees of emphasis and integration); these companies will be going head-to-head as the demand for performance management solutions heats up. Business Objects and Microsoft are also expected to detail their performance management strategies early this year, and enterprise applications companies, such as Lawson Software and PeopleSoft, view enterprise performance management as their territory. Don't be surprised to see more niche players snapped up as 2003 unfolds.

For further analysis on this subject, see contributing editor Mark Smith's commentary at IntelligentBPM.com.

— Justin Kestelyn

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