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Thu 9 Aug 2007 12:51 PM

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Cognos speaks out on BSG split

Software vendor Cognos has cast doubts over Business Systems Group's (BSG) ability to provide a truly vendor-independent business intelligence model after revealing to Channel Middle East that it formally terminated its relationship with BSG last week.

Software vendor Cognos has cast doubts over Business Systems Group's (BSG) ability to provide a truly vendor-independent business intelligence model after revealing to Channel Middle East that it formally terminated its relationship with BSG last week.

BSG has acted as an authorised Cognos partner for the past 18 months, but yesterday announced a vendor-neutral strategy following the launch of a regional ‘Business Intelligence Centre of Excellence'. That move will allow it to offer products from other vendors such as Business Objects, Oracle and Informatica.

Dubai-based BSG informed Cognos of its plans in July, but it has since emerged that Cognos has chosen not to back the strategy, leading the vendor to issue a formal termination notice. "We actually terminated the relationship with BSG last week, giving them a 30-day notice period to effectively tie up the loose ends," confirmed Derek Morrison, regional general manager at Cognos Middle East.

BSG believes its vendor-independent stance will open it up to customers who don't want to be limited by a single brand, but Cognos views the situation differently. "Our clients have been saying to us we want a domain expert and you cannot be master of every product that is out there in the market place," argued Morrison. "You really have to nail your colours to the wall. And BSG have gone Crystal, Business Objects, Cognos, and I think they are now going Oracle, so they have been round the houses."

Morrison also suggests that the practicalities of operating a multi-vendor policy are better suited to larger systems integrators in the mould of a Wipro or Satyam with access to significant human resources, than they are for companies such as 20-strong BSG.

"The smaller organisations and partners out there have to really choose where they are going to have that expertise," said Morrison. "They can't spread it too thinly or they're not able to support multiple products. If you are going to support those multiple products you've got to have a support desk with individuals who are domain experts. So the sheer economics of supporting multiple products is not, in my opinion, a viable economic model. However, that is certainly the route that the partner has chosen and we respect them for that."

BSG, in response, insists that it can readily draw upon the resources it needs to effectively operate its new centre and deliver on the promise of advancing its customers' business intelligence and performance management initiatives in a more streamlined and risk-free manner.

"The thing is we will not have an army of people on board here at BSG in Dubai but we have alliances with companies back in India, and I can list them if required, who have the resource pool available as an extended arm to BSG," explained Raheel Khan, regional general manager at BSG. "We've got the project management skills and the expertise. If there is a project that entails five people, for example, it could be that two people from BSG will be on board and then three other resources are brought in from elsewhere. And they will be managed by BSG and follow the best-practice and methodology that we have in place. That's the kind of model we would be taking if there are issues over manpower or resources."

Cognos plans to meet with BSG management in the coming weeks to discuss how best to migrate any mutual customers to the Cognos direct support model. Morrison - who maintains that the split has been a "very amicable divorce" - also says the relationship it now has with BSG does not preclude it from working together in situations that it terms a "joint opportunity."

BSG has also expressed its desire to sit with Cognos and explore how both parties move forward. "We will see whether there is another model that we can work through for licensing and maintenance, or whether there is no model," said Khan. "And we also need to resolve the training issue because while the licensing and maintenance agreement has been terminated, the training agreement is still on."

The current turn of events comes as Morrison - who has been in the region almost a year and grown the Nasdaq-listed vendor's local headcount to 10 people during that time - says Cognos will continue to pursue a strategy of ensuring that the skills of its channel partners' are not tied exclusively to business intelligence.

"For this region specifically the focus is on tomorrow," said Morrison. "It's not just a question of having a business intelligence competency centre, it's having the competencies around performance management, and planning and performance around tomorrow. That's why when I came out to the region last September I had to assess all our partner skills and look at the partners who were embracing performance management. Perhaps that doesn't sit particularly easy with some of our partners."

Cognos continues to shift its regional business to a model where the bulk of implementation and support work is delivered directly. According to Morrison, the Middle East is now moving in the direction of its global operations, which typically generate 30% of business from a partner network and 70% through direct sales.

"Prospective clients nowadays look to the vendor to take responsibility," added Morrison. "And in this region I will not say that the partner model is dead - the partner model is not dead - but clients are looking to the vendor to absolutely take the lead. They want the vendor's warranty around software, they want the vendor's warranty around services and therefore they want that guarantee of success that the project comes in on time and on budget. Whilst we will still have partners because they have additional competencies, we are certainly taking this market more on a direct model."

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