Its déjà vu all over again. It was just under a year ago that I wrote about a massive restructuring at Progress Software, and here am I about to do the same again. But in the words of the song, this time I know it’s for real.
Progress appears to have finally thrown in the towel in a number of the market segments that it competes in. From the press release that accompanied the announcement, it is clear that some deep corporate soul searching has gone on over the past several months and that somebody finally had the balls to introspect and ask “What is Progress Software good at?”. Having the corporate balls to ask the question is one thing, but today it appears that Progress has decided to act upon the answer.
In a previous post I asked whether corporate DNA existed, such that an in-built set behaviours and attitudes exist and pervade despite the changing business models and staff. Well perhaps my DNA observation was prescient because Progress’ news release used the term, stating.
Progress Software Corporation (NASDAQ: PRGS) announced today a new strategic plan designed to enhance growth, profitability and shareholder value. Under the plan, Progress will become a leading provider of a next-generation, context-aware application development and deployment platform in the Cloud for the Application Platform-as-a-Service (aPaaS) market by investing in its core OpenEdge, DataDirect Connect and Apama Analytics and Decisions products and integrating them into a single, cohesive offering. The strategic plan leverages the Company’s inherent DNA and vast experience in application development and deployment established over 30 years.
Aside from the 10-15% of its workforces’ lives and careers that this announcement will impact, I am pleased that Progress has looked at its DNA, mapped that to what the market needs and has tried to structure a company that can thrive in the Cloud. For too long Progress forgot its core values and differentiators and instead aimed to ape other vendors. The result was that Progress often had superior technology that was built or bought as much for the intellectual exercise as any commitment to commercial success.
Progress watched competitors in the integration space build out broad SOA portfolios and felt it should do the same. But it was OK for the likes of Oracle to diversify and buy another product line because as a company a) it was doing it because it wanted to make specific commercial gain and b) it is brutally efficient at selling software. Having a piece of functionality in the product portfolio because other vendors also had it appears to have been more important to Progress in recent years than actually having the wherewithal to persuade customers to part with the cash.
As anyone that ever worked at Progress will tell you, this technically-led DNA ran deep within the organisation. No company that I have worked for before, or with since, has had such an imbalance in the control structures of the company. For Progress, sales and marketing were seen as support functions for the product arm of the company. Today we’re seeing the impact of not putting sales at the centre of its universe.
With my analyst hat on, It’s been a while since I had an update from Progress and perhaps I need to fix that. I’d better declare an interest here – well several in fact. I’m an ex-customer, an ex-employee, I’ve consulted to the company and worked with them since I left in 2006. I used to get updates from friends that were still at the company but time has seen many of those leave to take better opportunities or fall victim to another round of RIFs.
I think this is a good move for Progress and I hope it works out. I’m also very interested in the aPaaS product strategy that Progress is embarking upon because PaaS is an area that really interests me at the moment. I’m also keen to see what might be behind this claim…
Progress is poised to create the industry’s most capable and language-agnostic aPaaS offering with multi-tenancy, Big Data connectivity, and real-time analytics in a new generation category that is experiencing explosive growth.
…because on the surface each of those product areas looks like it already exists and, dare I say, is dominated by others. What will also be interesting is who will pick up the product lines that are being divested: Actional, Artix, DataXtend, FuseSource, ObjectStore, Orbacus, Orbix, Savvion, Shadow and Sonic?
So Progress has made some huge decisions here but I think the most telling part of the press release is that it highlights that Jay Bhatt is the company’s first external CEO. I feel positive for the company for the first time in a long while. Why? Because Progress Software needed some diversity in its gene pool.