An Acute Focus on the CFO is Feeding IBM’s Appetite for Analytics – 10/27/10

OCT 27

Last week, IBM expanded upon its business analytics and optimization strategies by acquiring Clarity Systems, a Toronto-based software vendor principally focused on Corporate Performance Management (CPM) and regulatory compliance functions for the CFO’s office.

This acquisition in conjunction with IBM’s recently announced acquisition of OpenPages reaffirms several reoccurring trends by Big Blue and possibly sets in motion other market dynamics:

  • Since IBM’s announcement in May, the global technology company has been busily executing its plans to invest $20 billion by 2015 in an acquisition strategy that shift its focus into higher value segments.  The anticipated volume of acquisition activity would double the pace of the preceding five years.  Having utilized around $5 billion of acquisition capital to-date, IBM appears well on track to its 2015 goal.
  • IBM’s interest in business analytics & optimization, principally led by acquisitions made by IBM’s Software Group, will continue to be a primary driver.The acquisition of Clarity Systems marks IBM’s 24th related acquisition in the business analytics sector, including noteworthy acquisitions such as Cognos, Coremetrics, Netezza, SPSS, among others.  In fact, according to IBM, “in just four years, IBM has invested more than $14 billion in 24 analytics related acquisitions, dedicated 7,000 consultants and opened eight analytics Centers of Excellence around the world to help clients uncover hidden insights within their data.” We fully anticipate the battle ground for data management and business analytics will remain fierce as big systems vendors like EMC, HP, IBM, Oracle and others are all vying to help organizations deal with the ever-growing influx of (un)structured data and its relevancy to decision-making processes.
  • Business analytics and GRC/compliance functions will converge. Interestingly, it was the regulatory compliance and reporting capabilities, not CPM, that sparked IBM’s interest in Clarity Systems.  The acquisition of Clarity Systems extends IBM’s business analytics initiatives, but represents a new level of commitment to address financial governance and risk management challenges faced by financial departments and the CFO’s office.  In particular, its products help address financial governance and risk management faced by automating financial, statutory and regulatory reporting for the close-to-report cycle required the U.S. SEC.

As we assess the marketplace and continue an active briefing schedule with a range of global leaders and emerging innovators, the progression of functional compliance acquisitions into analytical settings is inevitable.

Let us know what you’re seeing the market place. Thanks and have a great week!

Brian Klemenhagen
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