Informatica Starts 2010 with a Bang

In a move that will send (pleasant) tremors in the world of data management, Informatica snapped up leading MDM vendor Siperian. I'm excited by this event, and here's why.

Informatica's acquisition of Siperian is far from unexpected. Not too long ago, I posed the following question: "What's stopping Informatica from acquiring an OEM partner like Siperian?" Others too would have had the same thought. Informatica CEO Sohaib Abbasi (indirectly) explains the delay in acquiring Siperian by stating that they are following a roadmap (read here for more). Well, ok, maybe. At this point, that's irrelevant.

So why is this great for Informatica and for customers and IT practitioners?Data integration and ETL (extract-transform-load) does not a business influencer make. For all its leadership in the data integration market, Informatica has remained a marginal player in IT shops, for the simple reason that ETL tools do not drive IT strategy, or even data management strategy... or even data integration strategy. IT strategy is driven by the need for business solutions -- and ETL is no more than a (relatively insignificant) component of the overall solution architecture. IT shops will buy Oracle applications and then buy the ETL tool that works with Oracle -- they won't start with Informatica (or another ETL tool) and then wonder which enterprise app to buy. For Informatica to gain more influence in IT shops, it needs to bring solutions, and not tools, to the table. Now, MDM isn't quite a strategy-defining solution either, but at least -- due to persistent and creative product packaging and marketing by the likes of Siperian and Kalido (aided and abetted by IT practitioners and media) -- MDM is seen as more of a solution than a tool. By acquiring Siperian, Informatica will gain the opportunity to be invited at more strategy discussions than before.

Siperian is a leader in MDM. If Informatica must get into MDM -- and yes, it certainly must -- then Siperian is an excellent choice. What stands out about Siperian, as with Informatica, is that it is an all-round MDM solution... and yet a strong leader in both technical and market terms. The companies are alike in their approach, and this creates great synergy in the merger.

ETL and MDM are joined at the hip. It's very simple: ETL moves data around and MDM is often right in the middle of all this data movement. When's the last time somebody implemented a large/significant ETL solution that didn't incorporate master data (whether packaged inside an MDM solution or otherwise)? I didn't think so. Remember, from one perspective, there are only two types of data: master and transactional, and Informatica is adept at moving both these data types around. The world of transactional data is dominated by vendors in the ERP and verticals space, and also by IT shops that develop in-house applications. That leaves master data, and it is greatly to the advantage of IT shops to get their ETL and MDM solutions from one vendor, reducing risk, cost and timescales. What's not to like about that?

Informatica has gumption. Although I've wondered from time to time about Informatica's lagging ways (e.g. see here and here), I've always admired Informatica's courage and persistence in going it alone, even when IBM and Oracle were going around town mopping up data management vendors. That takes guts, and that's what makes a leader. And it feels good to know that your data integration technologies are brought to you by a company that doesn't falter in the face of competition.

The upshot? It's time to reassess your EDM strategy. It will take me a full-length article (if not a few articles) to write on enterprise data management strategy, but suffice it to say here that your EDM strategy is a make-or-break factor for your business effectiveness and competitiveness. If you are already an Informatica or Siperian customer, the next few months is a great time to invite Informatica in for some strategic discussions -- remember, Informatica (together with Siperian) is STILL the only large independent data management tools/solutions vendor out there. Informatica doesn't come with the baggage that an IBM or Oracle or SAP does, and that bodes well for you. That would also be a good time to chat with Informatica about where they're headed in the future, and influence the direction and pace (which tempts me to write a follow-up blog on where I'd like to see Informatica go and which company I think they should acquire next).

On a parting note, is it time for Informatica to change its archaic title, "The Data Integration Company"? Please share your suggestions below.In a move that will send (pleasant) tremors in the world of data management, Informatica snapped up leading MDM vendor Siperian. I'm excited by this event, and here's why.