Features - Enterprise Data Insights:

ANALYTICS/ACQUISITIONS/PARTNERS WILL DRIVE CODA THROUGH 2003
by Simon Robinson for the 451.com

Financial application specialist Coda says sales of its new range of analytical applications has driven its growth through 2002; so much so that it has deepened its alliance with Cognos through an agreement to resell the business intelligence vendor's latest corporate performance management (CPM) software, Metrics Manager.

Elsewhere, the company is preparing for a big year ahead. It has access to a £20m ($31.3m) war chest that will fund at least one strategic acquisition in the coming months, and the company is preparing a channel offensive to court Navision and Great Plains resellers, which it claims are disaffected and confused following Microsoft's acquisition of the two companies.

Impact assessment:

The message

UK-based financial applications specialist Coda is strengthening its ties with Cognos -- and moving further into the analytics space itself -- by reselling the BI vendor's new scorecarding tool, Metrics Manager, as an integrated part of its Intelligence module. The company is also planning acquisitions to take it into new vertical and geographic markets.

Competitive landscape

Coda's traditional competitors in the enterprise application space -- such as SAP, Oracle and PeopleSoft -- also have well-developed analytical capabilities, but the company is directing its short-term efforts at Microsoft, with a program to recruit "disaffected" Great Plains and Navision resellers planned for launch by year-end.

The451 assessment

In a stagnant market, Coda has done well to maintain a modicum of growth -- and profitability -- by adding new functionality that allows users to extract more value from their existing financial systems. The deal with Cognos continues this trend, and should help Coda keep pace with other application vendors leading the charge into deeper, integrated analytics. Its plan to expand through acquisitions and recruiting new partners demonstrates that Coda isn't passing up any opportunities to aggressively broaden its footprint.

Context

Coda's dark days under the control of Baan appear to be well behind it. Following its acquisition by UK-based IT services group Science Systems in March 2000, the company swiftly addressed the mass defection of long-standing customers, and has demonstrated steady -- if not exactly spectacular -- growth since then. Its emphasis is still very much on midsized-to-large organizations, primarily in the financial and retail markets, and the company has since broadened its footprint from financial accounting applications to integrated analysis, planning and procurement tools through organic development. It also has a greater emphasis on services, tapping the Science Systems consulting pool.

Financial

Reflecting this greater integration between the two units (as well as the fact that almost a third of Science Systems' revenue came through the Coda division), the London-listed company changed its name to CodaSciSys in June this year. The company also reshuffled its top management in October, with former CTO Jeremy Roche replacing Graham Steinsberg as CEO of the Coda division. Steinsberg has taken over as chairman of the Coda division, and will focus on making strategic acquisitions that will expand the company's presence in emerging geographical and vertical markets. It has highlighted the utilities market as one where it would like to have a greater presence.

Meanwhile, CodaSciSys continues to post solid financial results. In the six months to June this year it increased its pre-tax profits by 10% to £2.9m, on revenue that increased 2% to £33.6m. The Coda division saw revenue up slightly to £20.1m, although its license sales contribution remains small at £4.9m. Consultancy sales were £6.5m, and support and maintenance sales were £8.7m.

Products

The company released its first integrated analytics module in April along with version 9e of its applications suite, and says robust sales of Coda-Intelligence have helped drive its growth through the year. Coda argues that the financial system is the logical starting point for providing detailed analytics because up to 80% of information required to run analytical reports already sits in these systems. Coda has also conducted research that suggests 73% of midsized-to-large US companies don't have a BI system, and 95% rely on manual spreadsheets for complex financial analysis, which don't provide real-time BI capabilities.

Coda-Intelligence provides a data mart, ETL (extract, transform, load) capabilities (licensed from German vendor Systemfabrik), forecasting capabilities and some standard report tools, as well as close integration with its core financial applications via XML-based links. More complex reporting and query functions are available through integration with standard BI tools from the likes of Cognos, for which it is already a global partner.

In an effort to push further the role and value of the data mart, Coda will now resell Cognos' new scorecarding tool, Metrics Manager, as an integrated option to Coda-Intelligence. Metrics Manager is a tool designed to simplify the management of an organization's key performance indicators (KPIs), and can hold hundreds of KPIs -- and their association with each other -- in a data mart for real-time analysis. Users are notified about target metrics through a set of red, amber and green lights that indicate whether each metric is below, in-line or above pre-defined expectations.

Users can drill down into each top-level metric (such as profitability) to see which of its constituent parts (such as costs or revenue) are making up for any under- or over-achievement. 'Real-time' notifications of this can be issued through wireless or email channels, which Coda believes will reduce business and financial analysts' reliance on 'static tools such as spreadsheets.

Competition

Meanwhile, Coda will be looking to exploit what it says is "total confusion" among former Great Plains and Navision resellers over the next few weeks with an offensive to attract resellers to its own partner ecosystem. Coda claims that Microsoft's acquisition of the two companies has left its partners with no clear vision of its strategy, from both a channel and product perspective. This is especially bad for Great Plains resellers -- says Coda -- in light of the Microsoft business solutions division's plans to add CRM, supply chain and other functions to its overall suite, since most Great Plains resellers make money by adding similar functions themselves.

On the analytics front, Coda acknowledges that its approach is comparable to that of giants Oracle and PeopleSoft, but plans to tailor its offerings for its key vertical markets. Microsoft itself is also targeting the BI space. This month it announced a partnership with analytics vendor Comshare to integrate its scorecarding software with SQL Server 2000 Analysis Services to provide senior managers with daily analysis of their business data.

Courtesy the451.com