Why Cognos capitulated

cognos.jpg“Possibilities are virtually unlimited for bundling BI capabilities with horizontal (e.g. sales automation, human resources) or vertical market applications (e.g. retail, manufacturing). Increasingly modular architectures for Windows products make it easier to tag on to other software solutions.”

The above quote comes from an op-ed piece written by Alan Rottenberg, who was then a senior vice-president of business intelligence at Cognos Inc., which appeared in Computer Dealer News back in 1996. He was right. Those capabilities did end up being bundled, but not simply as loose collections of products from a variety of vendors, but as part of a suite stack controlled by a few vendors who decided to buy everyone else.

IBM has a history of taking successful companies, keeping the brand name and yet making that brand utterly irrelevant to the remaining customer base. This is true of IBM Rational, IBM Tivoli and even IBM Lotus, although productivity tools tend to have a longer shelf-life in user’s memory. In Cognos’ case, there are a lot of other product brands that Canadian clients, particularly in the federal government, have come to trust, including PowerPlay, 4Thought and Impromptu. These were monikers that evoked the kind of dynamic, active decision-making that business intelligence software is supposed to foster. Its Big Blue takeover is being cast as an inevitability by many industry watchers, which may make it worthwhile to review how Cognos became such an attractive target.

Almost from the beginning Cognos demonstrated a canny understanding of its audience. It started out in 1969 as Quasar Systems Ltd., a maker of data extraction software for HP machines called QUIZ, but quickly saw there was an opportunity in working with higher-level enterprise information. When I first stumbled across the company 10 years ago, it was running a promotional campaign called 24 ways, that was complemented by a book called The Multidimensional Manager: 24 Ways to Impact Your Bottom Line in 90 Days. A step-by-step approach, a focus on “time to value,” a recognition of an executive’s layered responsibility in the enterprise: it’s all there. The following year, in 1998, it was working on a Web-based version of its reporting product. Who says Canadian high-tech companies are sluggish to adapt?

Consistent leadership helps too. In the late 1980s Cognos recruited Ron Zambonini as its director of R&D, and by 1995 he became one of its most colourful CEOs, arriving at a sales conference dressed in leather on a motorcycle (and this was before the dot-com hubris). He slowly groomed a successor, Rob Ashe, who has steered the company through one helpful acquisition after another and helped jump through a series of hurdles. You name the typical vendor crisis, and Cognos has faced it. In 2001, when no one was buying, it dutifully reduced its workforce by 10 per cent. In 2002, when it faced a patent dispute with rival Business Objects (now part of SAP), it made the wise choice of settling for US$24 million. The worst you ever heard about Cognos in the media was that it was boring. In a market where customers value reliability and minimal disruptions, that’s something of a compliment.

Cognos was still going where the money was – corporate performance management, compliance and so on – but the perception seemed to be that it had run out of ideas. And yet the nature of business intelligence is using the tools available to you to take the best course of action for your future. It’s not about knee-jerk reactions, but shrewd, calculated risks based on the best possible data. That’s what Cognos did. Far from bowing to the forces of consolidation or jumping on the bandwagon, it behaved, right until the end, like the kind of customer it had a knack for winning over.

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