If anyone had any question as to whether or not Hubwoo would pursue a business model independent of SAP, this recent announcement should silence any dissenting voices. Now, it was not always this way. Hubwoo once flirted with a different master before the higher-ups at SAP put the kibosh on it (from what I hear, this particular incident got a bit ugly, which is a shame because if they had followed through on it, it would have been a more diversified business strategy for Hubwoo to pursue -- and it also would have given SAP a true look under the clothes of its competitor). Regardless, that incident is in the past. What's news today is that Hubwoo is deepening its relationship with SAP.
According to the announcement, Hubwoo is adding the Business Objects "Spend Performance Management application to its business process outsourcing (BPO) services that are powered by SAP software". For those who aren't familiar with this solution, it's a full-fledged spend analysis offering that includes spend classification, data enrichment and related services, not to mention a seriously user-friendly front-end that leverages flex and integrates with Business Objects and SAP on a functional and data model level. Moreover, it extends Hubwoo's capability to serve as a single-source provider for SAP customers not wanting to work with SAP in a beyond the firewall procurement context.
With the announcement, Hubwoo now provides both hosting capability and additional support for four SAP applications: spend analysis, SAP E-Sourcing, Contract Lifecycle Management and eProcurement (SAP SRM). Hubwoo is supplementing SAP's capabilities in these areas with three others it positions in a similar upfront context as well: content (content authoring and search for eProcurment), a supplier network and their own invoice management capability. I suspect that longer-term, the value of these auxiliary services will decline when SAP eventually solves its own short comings in content management, supplier connectivity and, perhaps the most gaping of all from an organic product development (read: non-partner) perspective, invoice automation and EIPP.
In fact, I'd handicap the odds of SAP picking up a player in the invoicing space at over 50% in the next 12 months. Just as they've learned from their relationship with Commerce One before going down a path of building a viable eProcurement solution, SAP has learned from Open Text on key aspects of the invoice automation side. However, this time around SAP does not have the time to pursue the build path, at least in my view. Who might fill this bill for them? Basware would be an extremely good fit, although it would be a big and expensive deal. Kofax also shows potential (not to mention Ariba, but every time SAP engages in dialogue with Ariba, the conversation always seems to fall apart). Given this -- and given SAP's propensity to not do big deals -- we might see something more targeted like a hybrid build/buy strategy leveraging OB10 or something similar.
Still, in the meantime, Hubwoo could potentially build a very serious and profitable business with its current portfolio of products, filling in critical SAP product and solution gaps. And when SAP finally gets around to filling in its own holes, I'm sure Hubwoo will have something else up its sleeve (including keeping the Delphi on speed dial ...)