On the eve of the IT industry’s worst year since the dotcom crash, systems management vendor Compuware announced a drastic restructuring of its business. The 36-year old company – a veteran of the industry – vowed to shed its systems focus to become a ‘business service delivery’ supplier.
The reason was that, while its various products were still making money, the business wasn’t growing, says Compuware’s strategy vice president, Mark Hillman. “Our business was extremely healthy, but we needed to focus on what was going to grow,” he says.
It jettisoned certain components of the business – “things that we weren’t going to be the market leader on” – including its software-testing toolkit, which it sold to UK vendor Micro Focus, and it terminated some of its smaller products.
The concept behind the ‘business service delivery’ strategy, says Hillman, is to change the traditional focus of systems management tools from the infrastructure to the application.
“In the past, every time a new tier was added to the IT infrastructure, someone created a new tool to manage it,” he says. “But that just added more and more complexity. We had to take a view from the application down through the infrastructure, and look at it from the end-user’s experience downward.”
That means prioritising products that apply directly to application performance. Although its mainframe management products are a ‘cash cow’, Hillman says, “we’ve picked the application performance space as our focus for the company, and we’re putting everything behind that”.
In November 2009, Compuware put its money where its mouth is and acquired web application optimisation vendor Gomez for $295 million in cash.
Hillman explains that Compuware’s existing tools, focused as they are on the end-user organisation’s own infrastructure, are insufficient for managing web-based applications.
“With a traditional application, the IT guys have control over all the infrastructure components,” he explains. “With a web app, there are a whole load of extra components involved, such as an Internet service provider or a content delivery network.”
That was a pressing concern for the company, he says. “All applications are moving towards a web model. We’ve seen it primarily with customer-facing applications, but now increasingly internal apps too.”
The software-as-a-service nature of Gomez’s offering allows it to manage a more federated set of infrastructure components, he says. However, it also presents a challenge when it comes to integrating the company’s technology with Compuware’s own, on-premise application management toolkit, Vantage.
“We are starting to work on how we can ‘SaaS-ify’ the Vantage product set,” says Hillman. “Some of the functionality we can easily convert into an external service, but there is other functionality that requires deep access to the infrastructure behind the firewall, and that will be more difficult.”
Another challenge is to bring the Gomez technology into the unified service model that Hillman claims makes Compuware’s one of the only truly integrated systems management toolsets available.
“We have spent a couple of hundred million dollars integrating our tools with a single underlying service model that defines the whole IT infrastructure in the same context,” he says. “We will integrate Gomez into that service model over time.”
Hillman makes bold claims for the toolkit Compuware will possess once this integration is complete. “When you add the single service model to applications both inside and outside the firewall, you’ve hit the Holy Grail of systems management,” he says.
And these hyperbolic claims are not without corollary. In a note appraising the acquisition, Ovum analyst Tony Baer remarked, “Compuware now has a capability not matched by any of its rivals, and the timing is auspicious given growing enterprise interest in use of the cloud, especially for SaaS-based applications.”