There's people who work for vendors who subscribe to the school of thought that you should ruthlessly work to try to stamp out unauthorized brands. Take Frictionless for example. SAP acquired Frictionless Commerce back in the Paleolithic e-sourcing days, turning what was one of the most configurable sourcing and contracting platforms in the market into their own toolset. Today, even though the Frictionless name no longer exists, the platform certainly does (after countless additional hours of investment).
Still, many SAP customers continue to refer to the tool they've licensed not as "E-Sourcing" or CLM, but "Frictionless". Some might say this creates friction, but I say: who cares. If customers are satisfied and want to partake in their own stealth branding initiatives -- which at least some SAP sales and account team members most certainly continue to perpetuate -- it shouldn't matter. Clearly, nobody is correcting them at Sapphire when they slip the Frictionless name into conversation.
But what happened to the Frictionless platform? In 9 cases out of 10 a few years into an acquisition of what would become a core application asset, you would think the acquiring company would take the codebase and rewrite it onto their own stack/platform. But SAP has gone down the opposite direction, embracing the Frictionless platform and using it as the foundation for a range of new development initiatives. In fact, SAP's E-Sourcing code base (based on Frictionless) now supports their entire On-Demand platform strategy except their Carbon Trade application. This includes E-Sourcing, CLM, CRM, BI On Demand today and HCM and expense management tomorrow.
To make this possible, SAP has spent thousands of development hours enhancing the frictionless code and separating out the platform layer from the underlying application. Still, the code base dates back to the Frictionless days. In a twist of HR irony as most people who work for acquired companies end up leaving a year or two into a deal, many of the original Frictionless technology team members are left. This includes the head of development, the solution managers, etc. To this date, the Frictionless code remains autonomous inside the SAP development juggernaut. According to one source who is very close to the platform, they pump the same amount into developing and maintaining the code and platform every 18 months as the original acquisition cost. And currently, they're more than doubling down on that number.
Some may criticize SAP for being far more thorough and slow in their acquisition strategy than Oracle, a vendor who can push through deals with virtually no internal friction. But clearly, when it came to Frictionless, all that technology due diligence paid off. SAP did not only buy its way into the e-sourcing and contracts market -- they bought the foundation of a platform that has turned into something that no one could have conceived of back in the day when Frictionless was slugging it out with B2eMarkets and others for basic hosted auction and RFX deals.
Stay tuned for an analysis later today about where SAP E-Sourcing is headed from both a roadmap and overall strategy perspective.