A year later, IBM's Cognos views merger as right move at right time

Computerworld - IBM officially closed its $5 billion acquisition of business intelligence software maker Cognos Inc. at the end of January 2008.

In the year since then, the company has transitioned to the heart of IBM's business intelligence and performance management division, and moved strongly forward, according to Rob Ashe, the IBM general manager for that group.

In an interview, Ashe touted milestones such as two major upgrades to its flagship Cognos 8 suite and a "close to 20%" increase in the number of employees in the past year.

Things are going "great across the business," said Ashe, who first joined the company in 1984 and was Cognos CEO for three years.

As Cognos CEO, Ashe had talked about his dream of making Cognos the top independent BI vendor in the market. But reality, in the form of acquisitions by key rivals -- Business Objects SA by SAP AG and Hyperion Solutions Corp. by Oracle Corp. interfered, sending Ashe to seek the embrace of IBM.

The year and a half long courtship, which according to SEC filings began in July 2006, turned into a marriage proposal on Nov. 11, 2007. By the way Ashe describes it, it's still a honeymoon.

Take the recent layoffs at IBM, which have hit more than 4,000 employees and are still continuing. According to Ashe, Cognos has "not really" been affected by the layoffs, despite adding about 500 employees since the acquisition.

Despite the merger, Cognos was able to release Cognos 8 Version 3 a year ago and follow up with Cognos 8 Version 4 nine months later. This latest October 2008 release offers new search and mobile features as well as new user dashboards. For instance, Cognos responded to the banking crisis by developing risk analytics and planning solutions tailored to financial customers looking to cut spending in six months, Ashe said.

"Companies want to survive and thrive, cut costs or reduce risk and focus on their most profitable products and suppliers. For that, there's no better product than BI performance management," Ashe said.

Delivering two major releases in the past year helped Cognos make a strong showing in the influential Gartner Magic Quadrant for BI platforms that was released in January, where the company appeared to be ranked tops overall.

"We had a strong move, while our main competitor moved the other way," said Ashe, apparently referring to Gartner's downgrade of SAP division, Business Objects.

Cognos did just shy of $1 billion in revenue in 2007 before the IBM acquisition. Ashe declined to reveal what Cognos' sales are today, though he echoed IBM CFO Mark Loughridge's comment during IBM's earnings call in mid-January that Cognos "had a terrific fourth quarter."