Stibo’s Journey from Niche to Visionary MDM Vendor

Loraine Lawson

Stibo Systems recently ranked as a visionary in Gartner’s Master Data Management (MDM) of Product Data Solutions. IT Business Edge’s Loraine Lawson asked Charlie Lawhorn, senior vice president of North America, about being ranked as a visionary solution. Terry Stickler, director of marketing, also sat in on the call. The result was a little like talking to Click and Clack, the Tappet Brothers, about MDM.

Lawson: How old is Stibo?

Lawhorn: Great question, there’s a long answer and a short answer. The long answer, Loraine, is since 1794.

Stibo is actually part of a holding group that dates back to 1794. If you take a look at Wikipedia, you find Stibo in the world’s oldest companies. You can see through lineage that we can call ourselves the world’s oldest software company.

So that was 1794, but really …

Stickler: I don’t think they were doing MDM or PIM back then though.

Lawhorn:  Well, it’s 200 years of R&D. It’s pretty good stuff.

Stickler: Exactly, it’s a very mature solution.

Lawhorn: So when we say we have 200 man-years, that’s because we’ve had one man working for 200 years on this.

No, I mean it’s kind of a unique spin. We started off in 1794 as a printing company out of Denmark and moved forward into the 1900s and about 1960s, the family that was running the company didn’t want to have their children split it up or tear it apart, so they turned it into an irrevocable trust protected under the kingdom of Denmark and all this fun foundation stuff that we operate under.

What it really means is, we’re not an acquisition target. We’ve been quoted by the IBMs or Oracles and Informaticas of the world, and we’re not for sale. We are here to maintain a business and take care of our customers and continue to satisfy those customers and grow our business that way.

So Stibo Systems, the division that you're talking to today, started in about 1976. We moved into the U.S. in ’85 and we help people manage all the product information to pull it together for old-school print catalogs years ago. They then needed to feed that to CDs and websites and print collateral and emails and you name it and then it went from product information management and PIM into more MDM and feeding and sharing that rich information back across the business, across the supply chain out to partners. And over the last three or four years, I’ll call it, we’ve really started to get into the multi-domain MDM solution market, tying together product and supplier, product and location and we’re jumping in head-first with our next release in Step VI coming up soon with full multi-domain support from our product across all domains, all from a single solution or a single stack, unlike a lot of the big players out there.

There you go, there’s 200 years in 2 minutes.

Lawson: Will you market that as multi-domain MDM or?

Lawhorn: Yeah, we definitely will. We traditionally have come out of a PIM or product MDM marketplace. We’ve succeeded tremendously in that space. The blue chip customers being Kellogg’s, Wal-Mart, Sears, Home Depot and Napa and you name a brand, we’ve really just killed it in that marketplace.

As we move into multi-domain, over the last couple of years as we start to bring the customer domain into our solution, we’ve grown that internally with our customer base.  So we’ve been testing and playing and working with our customers in beta and development partners. We’re not just launching this cold turkey and hoping that it works.  We’ve been doing this under a methodical long-term approach. The beauty of Stibo being 200 years old is we have the luxury of thinking more than two years out. So we’ve actually been taking a methodical approach to the entry into the market, rather than just pretending that we do customer because we do product.

Lawson: You were recently in the Gartner’s product-oriented MDM magic quadrant as a visionary. Have you been in the quadrant before and are you typically a visionary?

Lawhorn: Oh, no, no, that’s a big move for us. I helped us get into the quadrant with our analyst team about four or five years ago. We started bottom left and over the last three or plus years, we’ve worked our way to the top of the niche group. So we kind of jumped over everybody else. Then, just this year, we made a significant move.

I know it sounds silly, but on a quadrant, we moved about two centimeters over to the right to the visionary side above pretty much everybody else from an execution, but also now way over to the visionary side where really it’s IBM and Oracle as kind of the big players primarily above us now. So we made significant ground and we saw SAP take about the same step we did forward, but they took that same step backwards this year. So we’ve made significant progress.

What’s also interesting is, Loraine, if you take a peek at the magic quadrant, IBM and SAP and those guys this year started to introduce multiple tools into the quadrant and are trying to sell multiple MDM things just for product to customers. And so it’s causing a lot of confusion out there.

Lawson: So what do you think pushed you into the visionary quadrant? I know Gartner gives some details in the report, but I wasn’t sure how much detail you were given versus what’s in the report.

Lawhorn: I think there are a couple of things. The way Stibo is trying to solve the multi-domain problem with a true single stack solution, between that, the blue chip customers we’ve got testing, playing and trying it, and the success we’ve had in our other domain that nobody can really deny that we’ve owned that market: I think those three things came together this year with this new release of Step Six that’ll come out in the spring to just culminate into a, “Gosh, it looks like Stibo is starting to pull all of this together and really execute.” As soon as this stuff around multi-domain really starts to hit the market, based upon Stibo’s track record, I think they felt comfortable enough saying people really need to look at these guys.

Lawson: How mature would you say you are in the multi-domain direction and how do people assess that?

Lawhorn: You know, it’s tough, right? Projects still start out classically from a product domain or a customer domain perspective. But what happens very quickly, we get very few RFPs or RFIs that are single domain anymore. The first question in the RFP is what domains besides products can your tool manage? So my question is, is that a PIM RFP or is that a multi-domain RFP? And it’s only once you get into the business challenges and the use cases that you start to realize that we want to tie our suppliers and master them to our products. OK, well, that’s multi-domain. But they're calling it PIM still, because product is what it’s centered around.

Lawson: At a technology level, is PIM very different from a customer-based solution versus the product-based solution? Obviously, they're set up for customer names versus product names, that sort of thing, but is there anything at the foundation that makes them different, that one has that the other doesn’t have?

Lawhorn: Yeah, definitely. I mean, overall, the premise of MDM is the same across all domains, right? Overall, the goal of MDM is the same and in MDM, there’s always supplying systems and consuming systems. So there’s upstream and downstream and there’s kind of an information supply chain that happens regardless of domain type. At a novice level, it’s easy to look at it and say, “Oh, if we can do product. We can do customer.” But that’s not the truth.

There’s a lot of distinctive differences and very specialized practices and focus in each domain. Gartner, when they say that it’s immature, I think they're saying that companies yet don’t have that deep domain expertise across all of those domains, not that the systems may not be able to handle the requirements or the data. So I think there’s that, but if I look at the systems piece of it, with product we have to connect to data pools like the GDSN. With customers, we have to connect with data pools like Experian or DNB or Trillium or you name it, right? So although there are similarities across those, the actual tools in marketplaces, both consumption of this information in and validation and then the extraction of it out, there are different tools. So we’ve had to attack this as kind of a separate business unit within Stibo to really focus on all-things customer. We couldn’t blend it mainline in with our traditional PIM stuff, because it is distinctive and unique.

Now, our sales team has had to learn how to blend both of those stories together with each of their intricate differences into a common message. That’s what’s taken us the time is those use cases and those deep domain expertise people and the hiring we’ve done and the staffing to bring the right resources in to support multi-domain as one team. I think what’s challenging the big vendors is they have five or six different teams representing their five or six different products and they still classically sell against themselves for the same solutions. We’ve tried to eliminate those barriers in the sales channel by selling holistic solutions to our customers really based off of kind of two RND tracks within Stibo to make this happen successfully.

Lawson: OK, how are you going to stay in the visionary quadrant now? Is there a pressure about that?

Lawhorn: Well, so far paying off Gartner has worked well.

Stickler: Loraine, I’ve increased my marketing budget so we can go completely upper right in the next couple of years, you know, so just a matter of funding, right?

Lawhorn: But no, I think we all realize it’s tough, right? I always view the quadrant as kind of a river and the river is always flowing from the top right down to the bottom left.  And if you're treading water, that means you're moving down with the river. If you're swimming upstream you just kind of stay in one place. If somehow you miraculously find a big rock underneath and you can leap forward a bit like we’ve done this year, that’s great. It’s tough though to keep finding those big rocks, back to your point.

I think that the key is for us to execute now on what we’ve shown Gartner we can do. If Gartner is saying, “Hey, this vision is good, if Stibo can execute,” the difference between the visionary quadrant and the leader quadrant is execution, Loraine. So we’ve got the vision there. If we can begin to execute, get our customers to adopt the platform as they have with product into true multi-domain, I don’t know that we want to stay in the visionary quadrant. We want to move into the leader’s quadrant.

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