Looking to push enterprise performance management deeper into the manufacturing operations realm, Cognos Inc. has acquired Celequest Corp., a provider of real-time dashboards that function as stand-alone appliances or can work in conjunction with other enterprise applications, including Cognos's flagship business intelligence product. Financial terms were not disclosed.
The deal, which closed on January 16, gives Cognos its first software as a service (SaaS) offering. Moreover, it provides Cognos with technology that complements its historical dashboard and scorecarding products, which already deliver a wide array of business analytics and reports to users across the manufacturing enterprise -- from the warehouse to the shop-floor and through to the top-floor.
Unlike most BI tools, which pull and manipulate data from dedicated data warehouses, Celequest's claim to fame is its use of in-memory streaming technology that enables end-users to monitor real-time feeds from transactional systems such as SAP ERP or Salesforce.com CRM. Celequest has found success in the consumer goods and high-tech manufacturing segments; the company references Dreyer's, Clorox, Brocade, and Solectron as key accounts on its Web site.
For manufacturers, Celequest's software service can be configured to provide a real-time, operational view of everything from shipment receipts and work in progress through analytics that measure product demand vs. inventory availability, noted Paul Hoy, Cognos's director of manufacturing industry solutions, in an interview. The acquisition "brings more shop-floor users and [supply chain] operation managers into the performance management world," he explained.
Operations end-users can tap WYSIWYG editing tools to configure Celequest with views that fit their unique business needs. They can also use preconfigured charts and role-based templates to speed time to deployment, Celequest said on its Web site.
The good news for Cognos users who wish to use Celequest alongside their existing BI products is that the software service features out-of-the-box interoperability with Cognos 8 -- Cognos's latest offering, which is built on a service-oriented architecture (SOA). Instant interoperability comes courtesy of the common Web services foundation that Celequest and Cognos 8 share, a Cognos company spokesman said.
AMR Research's BI analyst John Hagerty said the two companies' common SOA backbone is great from an interoperability perspective, but could create marketing challenges if not managed properly. "Cognos now has multiple ways to build dashboards, which is not bad, but having multiple metaphors and ways to do the same thing can be confusing," Hagerty said in an interview. The challenge for Cognos will be to communicate to customers and prospects where Celequest's real-time approach makes sense, versus Cognos's "non-real-time" method, he said.
If positioned right, manufacturers will be able to partner with Cognos for a diversity of business intelligence projects -- from deploying Celequest stand-alone appliances configured to solve particular manufacturing operations challenges to integrating the software service as a component within a grander enterprise performance management initiative, Hagerty noted.
"Companies want more BI to put in the hands of more people," but forcing them into a particular model or view undermines the technology's value, he said. "Having more options gives customers more ways to benefit ... And, Cognos has more stuff to sell to more constituents."
For Celequest, a 50-person, four-year-old company based in Redwood City, CA, the acquisition will give it a broader distribution channel, replete with vertically oriented resellers and OEMs, including a wide array of ERP vendors that bundle Cognos BI tools with their enterprise applications, Hagerty pointed out.
Like most small vendors, Celequest was most likely at a crossroads, Hagerty said, not knowing how it could get to the next level without heavy investment in sales, marketing, and development resources. Celequest's decision to turn to Cognos makes a lot of sense, given the alternatives, Hagerty noted. "It gives them the most [support]."
Celequest will operate for the short-term as a separate company under existing management, Hoy said. He declined to say how large Celequest is in terms of installed base and revenues or whether the company is profitable.
He did say that Celequest will continue to be offered as a standalone appliance and as an application service. The plan is to eventually integrate Celequest into Cognos 8, although Hoy couldn't say when that would occur. "This is [now] part of the development roadmap," he said.
Similarly, Hoy would not say whether the Celequest acquisition would prompt Cognos to more broadly adopt the SaaS model with its BI tools. "We are starting to see a market that is more [accepting] of SaaS," he said, adding that Cognos would only roll out SaaS offerings under its published product release schedule.
The acquisition comes weeks after Cognos reported a healthy spike in fiscal third-quarter revenues, driven in part by solid growth in new licenses. At that time, Cognos CEO Robert Ashe said the company would be on the lookout for smaller companies and technology to acquire that filled strategic voids in its enterprise performance management business plan.
The Celequest deal fits that bill, Hoy said, noting that it gives Cognos best-of-class, patent-pending technology that neatly co-exists with its current offerings.