Icertis and PROS partner to fend off the SteelBrick threat

More shenanigans in the revenue and contract management space as vendors of every shade position for the changing seasons.

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There are so many different players in the revenue and contract management space, from those focused purely on the subscription and billing aspects (Zuora, Aria and Vindicia), to the ERP vendors who believe they offer the best solution (NetSuite, Intacct and FinancialForce), and on to the pure-play vendors in various other spaces -- CPQ, CLM, etc. (vendors like Apttus, Icertis, PROS and a host of others).

All of these vendors had a bit of an awakening late last year when Salesforce announced its acquisition of SteelBrick. Finally the cozy little ecosystem with fair competition between the various vendors changed: Salesforce was, to an extent, putting a stake in the ground, and other vendors within the Salesforce ecosystem (most notably Zuora and Apttus, but others as well) had to move fast to rework their strategies.

So we've seen Apttus announce a deep partnership with Microsoft, seeing Redmond's Dynamics platform as a good alternative go-to-market instead of Salesforce. No matter the fact that Apttus is actually built on top of Salesforce and has little or no experience in the Microsoft world -- needs, as they say, must.

Less jarring (but equally indicative of the current climate) comes the news that PROS, the revenue management company, is partnering with Icertis, the contract lifecycle management (CLM) vendor. The press release announcing the deal has the fact within the first paragraph that Icertis is built within the Microsoft ecosystem -- a pretty stark recognition that lines are being drawn in this war.

Anyway, the new integrated solution aims to create a unified experience across the revenue and contract management stages of an organization's process. Essentially it is something of an admission that standalone "pure-play" solutions don't work and that really simplifying the process around selling requires an end-to-end solution.

As the companies jointly suggest, by combining CPQ and CLM, sellers can more accurately predict customer needs and prescribe -- in real time -- product configurations, price guidance, quotes, proposals and execute contracts, helping drive higher revenue and faster profit realization.

Which leads to something of a problem, at least inn my mind. Admitting that a pure-play solution isn't the optimal way of delivering customer needs around revenue management, leads me to suggest that not having revenue management as a core part of the enterprise back-office system of record is also suboptimal.

Maybe I've been drinking a bit too much Kool-Aid after spending time talking with ERP vendors NetSuite, Intacct and FinancialForce over the past few weeks, but their perspective strikes a chord: that unless your contract management systems and processes are an integral part of the ERP solution, you're introducing complexity, room for error and a drain on agility into the system.

Of course, the two vendors doing this deal would disagree. Firstly from PROS:

"Companies competing in today's marketplace know firsthand that creating great customer experiences is redefining the competitive playing field," said PROS President and CEO Andres Reiner. "Our enterprise-class customers realize they must create a personalized, frictionless customer experience for doing business across all of their channels. The Icertis relationship builds on our strategy of collaborating with partners to modernize business processes and increase business velocity. We look forward to bringing this joint solution to the Microsoft ecosystem using Dynamics and Azure to help our customers outperform."

Well, yes. But part of being frictionless is having all customer data in the contract management system. And that means all of the historical sales figures and metadata around them.

Icertis' perspective seems to be that the best solution only needs end-to-end integration across the sales process and that this is a separate value proposition form the ERP one:

"The Icertis Contract Management platform helps transform contracts from plain documents to core assets for intelligent insight," said Samir Bodas, co-founder and CEO of Icertis. "With the integrated ICM and PROS Smart CPQ solution, sales professionals will not only be able to seamlessly create contracts from quotes; it will amplify the customer experience by providing access to rich insights in existing contracting relationships."

That's a perspective that I understand, and I have sympathy for it, but it also seems a little short-sighted to my mind. One thing is certain: Solutions that only fulfill a small part of the total contract value proposition are not sustainable. The jury is out, though, on the stage at which real value is driven -- time will tell how that goes.

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