V Joe Nathan, chief operating officer of Compuware, has set a goal for the company. We want to be in the top five software companies worldwide, he says. Compuware, which took eighth place in this year’s CBR Software Top 50, made its name in software testing tools for the mainframe, but in its 23 years of business, has expanded its sphere of competence to include application development and, most recently, systems management tools. Systems management as yet constitutes a small portion of Compuware’s overall business. According to Nathan, systems management tools accounted for around 11% of the company’s overall product revenues last year, compared to around 22% from application development tools and 66% from software testing/implementation tools. However, he points out that the systems management business saw 70% growth, and he is confident that it is set to become a much greater part of Compuware’s overall business. The systems management products, EcoTools and EcoScope, he says, are the fastest growing products in the company’s history. Compuware began its drive into systems management in 1993, when it acquired Ecosystem Software and launched the EcoTools product, which monitors and manages the performance of servers from an application perspective. Its product range was expanded again in 1995, when the company bought Coronet, and began selling its Econet product, a tool for tracking network performance, which has since been renamed EcoScope.
Feet on the street
At the time of acquisition, both EcoTools and EcoScope were start-up products with a client base of less than five customers. Buff Jones, Compuware’s vice president of systems management, says that the strategy of acquiring competitive products in order to broaden the company’s portfolio will continue. We acquired in 1993, we acquired in 1995, that puts us on track for another acquisition towards the end of this year. Compuware is also working to establish a higher industry profile through its marketing strategy. The company, which has described itself as ‘the greatest company you’ve never heard of’, has historically made its money by selling new products directly to existing customers. It is now courting a wider market base for EcoTools and EcoScope, and last year, spent as much money on the marketing of these products as it did on the marketing of all of its other products combined, according to Jones. Another important factor in the growth of the company’s systems management business is the development of its direct sales force. This year Compuware is looking to expand the team working on selling systems management products by 70% to 80%. The more feet we put on the street, the faster we grow, says Jones. Compuware’s systems management business is continuing to show encouraging growth. In the first quarter, product revenues grew by a further 78% over the corresponding period of the previous year. Though it remains a small proportion of the overall business, the systems management momentum is fueling a significant part of the company’s overall growth, and will assist in the fulfillment of Nathan’s ‘top five’ ambition.
