As the services industry comes to terms with the transition to a Cloud-based IT industry, CSC has taken on the implementation services business of business process innovation and Enterprise Cloud Orchestration firm Cordys.
The alliance agreement between the two firms covers implementation services and a worldwide reseller agreement for the Cordys Business Operations Platform. It also includes transitioning the entire Cordys Benelux professional services group to CSC to establish a CSC practice with expertise in Cordys technology and take it to a global level.
“A year ago, Cordys made the strategic decision to follow a partner-centric business model and reorganised the company accordingly,” said Jan Baan, chief executive officer of Cordys. “Despite the difficult economic climate, we have seen significant success with this strategy. Looking at the strong increase in both actual sales and pent-up demand for Cordys solutions, the agreement with CSC was the next logical step. Cordys will continue to focus on product development, sales and marketing, and support.
“We are very excited about the impact this strategic partnership will have on the market. Business process management continues to be one of the fastest growing segments of the software industry, and CSC is recognised as a global leader in the field of business innovation. The Cordys technology will further enhance that leadership. This fact made it easier for us to move our top consultants and implementation experts to CSC.”
Both companies are keen to play up the long term strategic nature of the alliance. “The relationship is very much a strategic footing one,” explained Andrew Levine, CSC Director of Global Business Solutions. “We have some very large customers who have enjoyed a multi-decade relationship with us. We have customers who have been here for 40 years. The technology stack that Cordys provides is of enormous strategic benefit to such customers. It enables them to leverage their existing investment while layering on new technologies.
First among equals?
The relationship is not exclusive – should a client wish to deal with Capgemini, for example, this is quite feasible – but it's clear that where there is no stated client preference, CSC becomes first among equals.
Cordys itself should benefit from the global reach of CSC, handy when the positioning of the firm is complex, having feet in the BPM, applications and middleware camps. “I would say we are a Cloud middleware company,” said John Pyke, Cordys chief strategy officer. “We are almost a SaaS-enabled applications platform, but you don't have to run it in SaaS mode. Our product has been built from the ground up as a fully multi-tenanted offering. No-one else in the market can make that claim. I don't think there's a maintream vendor who can follow us down this path. We've put 2000 man years into this. We've got a highly integrated technology stack.”
But from CSC's point of view, will the relationship with Cordys help it to transition through the potential revenue model pain that many services firms face as they move from upfront implementation projects to an ongoing subscription model? “We did a lot of due diligence on Cordys,” says Levine. “When we came to the transition point we already understood what pieces needed to be in place. We try to be as smart as our customers teach us to be. We have set up Cordys Resource Centres around the world. We have set set up vertical market specialist divisions under our global practice management umbrella. From our point of view, the transition is not so much painful as realistic.
“We see Cordys as one more element of our value add proposition for clients. We'll probably see smaller contracts, but more of them. The Cordys technology enables us to carry out implementation faster, so we can get through more projects more quickly. Customers will be paying less, but getting a faster return so in turn CSC will get more projects.”
The alliance may also alter the demographic to which CSC sells. “We spend a lot of time talking about the Cloud to CIOs and doing knowledge transfer, but we get a far richer response from talking to the CEO and CFO,” said Levine. “What's fascinating is that Cordys has brought to the table a tool set that means that the business people can be self-deterministic. If the business wants a new system, they would do a flow chart and then hand it over to the CIO where it would get lost in translation.
“But CIOs will still have a critical role to play in five years time. They will forever be a source of innovation for their organisations. What I think we will see is a rise of the skills sets that embody the processes inside an organisation. We will see more Chief Processing Officers and their emergence will bring business closer to IT.”
But as the alliance rolls out, what will the compelling driver for Cloud adoption be? In the midst of recession it has been primarily financial, but will that remain the case as the economy picks up. “I think it will,” suggested Pyke. “The recession basically caused people to look at the way they did certain things. This is cheaper model and a more flexible paradigm. People have started to realise that there is so much disk capacity spinning away in the world and nothing much happening on it.”
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