Continuing Coverage: Emptoris and DiCarta

Mickey North Rizza and Mark Hillman of AMR have published an excellent analysis on their take on the Emptoris / DiCarta merger. You can read it by clicking here (free without registration, for now). According to AMR, "From a product strategy standpoint, this merger makes sense: CFOs need a package that can aid in supply management transformation initiatives . . . Early indicators of success for the merger are promising, including an integrated management team representing both companies, availability of an integrated product based on months of joint development, and Emptoris’ successful track record integrating Zeborg, Valuedge, and Intigma."

Earlier this afternoon, I had a chance to speak with some of the executives from Emptoris as well. On a high level, here are some of the key points I learned from the call:

Size -- The combined firm will have 360 direct employees (not taking into account employees which are part of outsourcing deals). In addition, Emptoris has retained the entire DiCarta team (for now) except the finance organization.

Deployment Model -- Despite a market perception that Emptoris focuses on behind the firewall software deployments, it turns out that only 5% of their current installations are behind the firewall.

Solution Focus -- Emptoris now has a great story to tell on the compliance side of the Spend Management market. The merger goes beyond filling in a relatively weak product offering that was causing Emptoris to previously lose deals. Rather, the new solution focus represents a complete rethinking about the role of compliance and contract management in the broader organization. I will be digging into this in much greater detail later this week.

Sales Strategy -- Emptoris continues to work the partner channel aggressively. 29% of their deals to date have come through channels (not counting referral business), while 71% has come from direct sales.

Partner Ecosystem -- Emptoris has built out a strong partner ecosystem consisting of Accenture, CGE&Y and IBM on the channel / integration front. On the outsourcing front, Emptoris is working closely with Accenture, IBM, ICG Commerce, and IBX. And with a recent "Powered by NetWeaver" certification for Emptoris 6 -- the vendor's latest product release -- Emptoris has a good story to tell from a business process integration standpoint with the dominant ERP provider which is resident in 60% of their current accounts.

Jason Busch

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