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Question and Answer: Ignore Holistic Performance Management At Your Own Peril

Cognos announces an ambitious partner program and gives customers a glimpse of its forthcoming Cognos 8 BI suite, now in beta

• By Stephen Swoyer
• June 29, 2005

This week, business intelligence giant Cognos Inc. kicked off its annual Cognos Forum customer conference in Orlando. At this year’s Forum, Cognos unveiled an ambitious new partner program and gave attendees a glimpse of its forthcoming Cognos 8 BI suite, now in beta. Officials also sought to advance Cognos’ idea of “holistic performance management”—which includes the company’s BI, planning, and scorecarding applications.

We spoke with Mychelle Mollot, vice-president of market strategy with Cognos, about her company’s performance management push. Although Cognos is emphasizing what it calls corporate performance management, Mollot says there will always be a place for conventional BI. Nevertheless, she claims, performance management is poised to go mainstream—and companies who ignore “holistic” performance management do so at their own peril.

For a while, it looked like business performance management was a market waiting to happen, but—if research from Knightsbridge Solutions and others is any indication—it looks like BPM is on the verge of going Supernova. Even Microsoft is taking notice, with Maestro [a business performance management product]. But isn’t it the case that most organizations are still doing sort of what we might call conventional BI or reporting? And if that’s the case, won’t many of them just build their own BPM solutions—just as they’ve done on the BI front?

First of all, yes, most companies are still doing what you’d call conventional BI or reporting. But it’s important to understand that within these organizations, in these pockets within these organizations, they’re using sort of this holistic approach to corporate performance management, which encompasses not just BI, but also scorecarding and planning.

As companies mature in this view, they’re going to realize that when they do have these needs for scorecarding applications or for applications that need a combination of planning and business intelligence, [and] that those applications should all come from the same platform.

Cognos is known first and foremost as a BI vendor, but you’ve also made an aggressive push into BPM—what you call corporate performance management—over the last few years. Your two biggest competitors [Business Objects SA and Hyperion Solutions Corp.] have also emphasized a similar strategy. Where does this leave the sort of BI pure-play vendors—your competitors that are still concentrating mostly on what we’ll call, for lack of a better term, conventional BI?

We believe there will always be uses for business intelligence on its own in organizations, that not every single thing that gets deployed will include all three of the elements I talked about. If you want to think of it as the old pyramid, BI is definitely the foundation, and companies will need an information-delivery infrastructure that can go to every user, and they’ll have hundreds of different applications that will just be BI, just be reporting.

So the bulk of the market is not thinking about holistic performance management in the way we’re talking about it as all three things together. However, as I’ve said, the bulk of the market does have pockets in their organizations that are. In the last year, there has been an incredible increase in the number of partners who are purchasing all of our capabilities together. That signals to us that they get it—they get that these things should be used holistically. They’re getting it from all sides, because the vendors are sharing with them customer success stories.

You market a discrete planning application and you talk about planning as one of the three parts of what you’re calling “holistic” performance management. But from my experience, a dedicated planning tool has historically been a tough sell. Most planners live in Excel and like to use Excel for this [planning] purpose. Can you point to any success you’ve had in kind of cracking this nut?

We’ve had excellent growth for Cognos Planning. We had 40 percent growth in planning last year, and 24 percent in our most recent quarter, so there’s a real demand out there for this kind of dedicated solution.

One of the things driving this is compliance—regulatory compliance. It’s [occasioned] a fundamental re-look into core systems, so people sat down and said, “I have to be compliant.” So they documented all of their processes, and then they realized that they have a lot of risk in all of the spreadsheets they have in their organizations. They’re getting advice from all of the conferences they go to [saying] “Move away from spreadsheets. They’re not safe, they’re not secure.” The market is starting to follow.

You had your Cognos Forum [customer conference] this week. What’s the big news coming out of that event?

We’re making a lot of announcements. There’s a lot of news coming out [of Cognos Forum].

We announced a new Partner Program, for example. Customers say to us, it’s good to have a platform, but that’s only part of what they need. Now they’re looking for us to deliver more value in terms of solutions—best practices—and to really bring them an ecosystem of people who are specialized in total performance management, so that’s what the new partner program is all about. It’s designed to help develop and foster and showcase partners who have committed to the platform and who are developing holistic performance-management solutions. It’s different from our normal partner programs, where they may be OEMs and may just deliver a couple of reports on our application. This is for partners who are delivering solutions entirely in Cognos, or mostly in Cognos, and solutions that are mostly focused on performance management.

You also announced Cognos Series 8. ...

Right, our new BI platform, Cognos 8—it was introduced. It was launched to the customers here. It’s gone to beta.

Do you have a timetable for final release? And what kinds of new product additions or product enhancements can we expect to see in Series 8?

A. Beta’s already on now, [and it will] go through the summer, [with] release of the product scheduled for later this year. At this point, we’re not making public all of the new features, but you can expect enhancements to every new capability of the platform, as well as the platform-services layer itself.

You said Series 8 was launched to the customers at [Cognos Forum]. Does that mean it was announced, or did customers actually see a demo? And if that’s the case, did customers who were in attendance learn anything about the additions or feature enhancements forthcoming [in Series 8]?

We talked about it, about what they were going to be seen, and they were shown all of the elements of the new platforms, so new analysis [capabilities], new features, and other enhancements, yes.

One final question. You’ve touted what you say is very impressive growth for ReportNet, in tandem with your most recent earnings statement. Is this [growth] mostly among existing [Cognos] Impromptu customers, or can you point to any new customer wins, maybe customers drawn to Cognos solely on the strength of ReportNet?

Absolutely. We had 25 percent growth in ReportNet [last quarter]. And, yes, absolutely, ReportNet is driving a tremendous amount of new business, customers who are coming to Cognos for the first time by way of ReportNet. We don’t break it out for the market in general, but we do have new customers [like this] that we’d be happy to let you speak with.