What Happens When Tech Vendors Don't Integrate Acquisitions?

Loraine Lawson

Occasionally, I like to look at how a company is handling integration after a merger or acquisition. Oracle is the king of this beat, since the company has an aggressive acquisition strategy and tends to integrate the technology.

In fact, just this week, Oracle announced plays to buy Silver Creek Systems, a best-of-breed data integration/quality/governance solution company specializing in product information management. It's also used in master data management solutions.

Right away, Oracle made it clear Silver Creeks is destined to be acquired and assimilated. Datamation reports Silver Creek will "help round out the software giant's business applications portfolio and will be integrated with its own data integration, data quality, master data management and business intelligence offerings."

Oracle also issued a press release with this statement by its senior VP of its Fusion middleware group, Hasan Rizvi

Lack of standardized product data continues to be a challenge for many enterprises. With the addition of Silver Creek, Oracle is extending its industry leading data integration offering with complementary solutions to enhance product data quality and help customers get more accurate and consistent product data for use across their enterprise.

An analysis of the Oracle/Silver Creek deal published by Information Management suggested the acquisition might create problems for Oracle's competitors. It quotes a 2009 Forrester report, written by analyst Rob Karel, as stating, " many of Oracle's competitors rely on Silver Creek to add a competitive edge. The reality is a lot of them will have to look elsewhere for product data quality expertise now."


What this means for customers is embedded data quality for product data, Karel adds.


But not every one thinks it's a big deal for MDM competitors. "Does anyone in the MDM world even care," asked Ramon Chen, the VP of Product Management for infrastructure software company RainStor and a former employee of MDM provider Siperian. Chen writes that the deal:

... highlights that Oracle continues to have separate hubs for customer and product data while companies like Siperian and Initiate Systems continue to flourish as MDM platforms of choice for organizations that believe that you should be able to manage all data types in a single hub. So I doubt if anyone at Siperian or Initiate is in a panic over this.

Perhaps more interesting is Chen's observation that there seems to be a consolidation trend afoot in the master data management space. He also thinks IBM's recent acquisition of Lombardi, a BPM provider, "be interpreted as play on among other things in the MDM ecosystem."


I'll let you read his logic on that one, but the IBM/Lombardi deal does bring up another point: What happens when there's a vendor acquisition, but no technology integration?


While several pundits believe there will be some integration between the two-Miko Matsumura of Software AG has a fun roundup - the Burton Group's Anne Thomas Manes is skeptical. In a December blog post, she relates that the Burton Group's customers already feel IBM has too many BPM products, adding:

This acquisition might make sense if IBM intended to rationalize the products and create one leading-edge product that addresses all BPM use cases (e.g., human-centric, system-centric, document-centric, case-centric, etc). But it seems pretty clear that IBM has no intention to do so. And why should they? They'll generate a lot more revenue selling an organization site licenses for three products than for just one. And given the burden it will place on end-customers to try and figure out which product to use where when optimizing a business process, it will also give a boost to IBM global services.

So what happens when one tech vendor buys another and they don't plan to integrate the technologies? Well, in this case, it could lead to silos of technology. "...I'm concerned about the future of a product in the WebSphere family that is viewed as a departmental solution," Manes states. "I don't think it bodes well."


Well, it wouldn't, would it? I mean, seriously-applications silos lead to information silos, and haven't we had enough of that already?

One would hope Manes is wrong about IBM's intentions, but I wouldn't bet against her.

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