IBM absorbs Cognos quickly, adds integrated BI bundles

One week after completing its acquisition of Cognos Inc., IBM Wednesday said it was ready with new product offerings that integrate some of its technologies with the business intelligence vendor's Cognos 8 software.

Acquiring BI and related technologies and integrating them into its product mix has become routine for IBM, which has bought a total of 25 vendors in that market since 2000. But the company's US$5 billion purchase of Ottawa-based Cognos, which was announced in November, is its largest BI deal thus far.

Steve Mills, senior vice president of IBM's software group, said at a press conference here Wednesday that enterprise users need a more comprehensive set of tools to support real-time decision-making. "The technologies have to become tighter linked," he said. "It was time to bring these things together and make them one contiguous set of capabilities."

Among those on hand for IBM's announcement was Paul Valle, CIO and vice president of IT at Papa Gino's Inc. The Dedham, Mass.-based restaurant chain installed Cognos-based BI systems early last year, and Valle said he can see benefits to the integrated product set that IBM is offering. Papa Gino's also uses IBM hardware, including its blade servers and its System i midrange line, which previously was called the iSeries and before that the AS/400.

But what Valle isn't completely certain of is the cultural match between IBM and Cognos. He said that the BI vendor won the Papa Gino's contract "not just because of their product, but because of their culture -- they cared about us."

Valle said that after the software sale, a Cognos representative attended many of the IT department's weekly status meetings, something the vendor wasn't obligated to do under the contract. "The care they gave us during the sales cycle went beyond [what was required]," he added. "I'm hoping that goes through with IBM."

In buying Cognos, IBM is picking up a company that has about 4,000 employees and 23,000 customers, and that already was one of its business partners. And IBM is doing with Cognos what it typically does in such acquisitions: offering pre-integrated bundles of products and services.

For instance, IBM said it is integrating Cognos 8 with its own Information Server and InfoSphere Warehouse technologies, while also offering pre-configured templates for integrating the BI software with its FileNet business process management tools.

The integration of Cognos 8 and InfoSphere Warehouse is of interest to Carl Try, manager of e-commerce and advanced technology at Fiskars Brands Inc., a Madison, Wis.-based maker of garden tools, school and office supplies, scissors and other products.

But Try said that he needs to learn more about whether IBM's so-called dynamic warehouse concept will enable him to add data into his company's BI tools from more sources, such as spreadsheets.

With Cognos, IBM is also getting new visualization tools that give end users a dashboard-like view of data. Mills said that the acquisition gives IBM "a complete, end-to-end set of capabilities" for supporting BI applications.

Even so, the deal likely won't be its last in the BI market. Mills wouldn't specify what other technologies IBM might want to add, but he said that the company's acquisition strategy isn't based solely on buying the customer lists of other vendors. "We buy companies for lift, for growth, for strategic advantage -- not just simply for mass," he said.