Stay Ahead Of The Competition

By Richard Adhikari

f you partner with a software vendor, will you lose your competitive edge? No way, say companies that have been involved in partnerships.

Take Hunt Manufacturing Co. The Philadelphia maker of office equipment is providing its world-class logistics and transportation management processes to software vendor QAD Inc. QAD will incorporate the processes into On/Q, its next-generation supply-chain and logistics system. While QAD needs to incorporate these processes to make its software useful to Hunt, transportation and logistics are not part of Hunt's core business, says Gene Stiefel, Hunt's VP of IS. "These activities don't differentiate us in the marketplace from a com petitive standpoint," he adds.

But if the tools developed do give a company a competitive edge, the company can always negotiate favorable terms. For example, some companies require their software vendor partners to refrain from selling the software to their direct competitors for a stipulated period of time.

Others do what Douglas Bott of Custometrics is doing. Custometrics markets to the electric utilities industry an application that its parent company, Wisconsin Energy Corp., developed for its own use. "This is the ideal competitive advantage," says Bott, Custometrics' CEO. "You know exactly what technology your competitor's running on, since you've installed it in your own company two to three years before they have."

That lead may increase because it takes a while to understand how a technology works. Says Bott: "Even if I give you the crown jewels to my company, it'll take you several years to tap their full value."

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