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June 29, 2004 

eXtreme Networking Champaign 2.0

 Q&A: ADVIZOR Solutions CEO Doug Cogswell on Global Software 6/29/2004
The mission of Going Global is to educate and inform Midwest technology companies on what local technology companies are doing internationally so other firms can learn from the successes of like-minded peers.

DOWNERS GROVE, Ill. – If you asked president and CEO Doug Cogswell, the business visualization software from Downers Grove, Ill.-based ADVIZOR Solutions creates business intelligence solutions out of the glut of reports people deal with every day.

ePrairie international columnist Michael Muth sat down with Cogswell to glean how ADVIZOR Solutions spun into life, understand the dos and don’ts of local software going global and the hurdles associated with international advantages.

Michael Muth: What are the international advantages of spinning ADVIZOR Solutions out of Lucent Technologies and Bell Labs?
Doug Cogswell: I spun our core technology out of Lucent and Bell Labs in late 1999. Because Lucent and Bell Labs are marquis names that are known globally, this gives us credibility. It’s a stamp of endorsement around the world that definitely gives us an advantage over other small start-ups.

MM: How did your international partners find you?
DC: We’re trying to find regional solution partners in Chicago, New York and London who put in business intelligence systems. We’re looking for partners who understand this customer base. Two of our bigger OEM partners – business objects and information builders – have given us a lot of visibility. A number of our regional partners have found us through them.

For example, partners from South Asia will come to the business objects global partner summit and will be introduced to us there. Partners also find us through our Web site when they search on data visualization or dashboards. We are also proactive at seeking out leading partners in our core markets of Chicago, New York and London.

MM commentary: Because Chicago is a trade show Mecca, many potential international partners can be found visiting us here rather than having to seek them out in their country.

Last week’s SUPERCOMM show had almost 100 exhibitors listed with foreign addresses and 2004’s retail systems show had about 30 international exhibitors. Plus, each of those figures probably understates the number of foreign visitors because many foreign firms have already established local offices here and include that address rather than the address of their headquarters.

These are often better partners than those found in their home country because they’ve already invested in spending money to come here to find customers and partners.

MM: What hurdles do you have to jump over in screening potential partners?
DC: The challenge is you get a bunch of people who say they’ll represent you [and you have to weed out the right ones]. We ask a lot of questions. What’s your experience in business intelligence? What other products do you sell?

We get fairly specific that they’ve sold major brands, that they have an installed base, that we can reference those installed accounts and that they have 20 or more people who know business intelligence (BI). We’ll get into tech briefings. We screen lots of people out on our Web site. We quickly get to the bottom of it.

MM commentary: Qualifying a potential partner is one of the most difficult issues to address because there’s much less disclosure required in foreign countries. Therefore, information on foreign firms is much less available than on domestic companies.

Though it’s not always fail safe, one good way to qualify them is to ask the right questions and verify that they can back up their responses.

MM: Have you localized your software & training materials for particular markets?
DC: Because our software is internationalized, it’s Unicode compliant. Because our text files are all in resource files, it’s easy to localize. We actually don’t have that much of a local language problem.

Most of what you see in our dashboards is pulled from the customer’s database. If they have a local language there, that’s what we will display in our dashboard. We’re doing a Japanese version in partnership with one of our bigger OEM partners right now.

MM commentary: To clarify, software must typically be internationalized – broken down into its component parts and simplified – before it can be localized and translated into local contexts, languages and formats.

MM: Does your data visualization software have any particular advantages internationally?
DC: We are in a global market. The business problems we are solving are pretty consistent around the world. Our partners in other parts of the world often tend to be more sophisticated than those in the U.S.

They are used to working fairly independently with U.S. software companies and they need to be able to provide full support to their customers. They tend to come up to speed more quickly from selling all the way through the implementation.

MM commentary: ADVIZOR does have an advantage here. What a customer sees on his computer screen is the data he has submitted. That means ADVIZOR doesn’t have to deal with the translation of pesky text while many other more text-based software developers must.

MM: Does your software automatically account for foreign currency differences and fluctuations?
DC: Yes. For example, if we’re pulling the data from an Oracle database and the amounts are in Euro, that’s what we will track and display. The same thing applies if it’s in Yen.

The software will also appropriately use commas and periods based on the way they are used in the local country because some countries flip around how we use commas and periods in our U.S. numbers.

MM: How do you account for differences in levels of security that are required for foreign markets?
DC: Our solution doesn’t have security in it. We rely on the security of the database that’s there. We run on a desktop and we run on the server. Some environments won’t allow the desktop because you can’t send data anywhere. The database sits inside the protective environment.

That’s important for health care, financial services and banking because they aren’t allowed to distribute data to people’s desktops. This is one reason why we work only through leading partners internationally. They’re very sophisticated.

They’re selling our software along with software from others. It’s very important to pick a quality partner who deals with the right foundation and platforms underneath. They need to understand the security issues and make them work.

MM: Are your revenue streams any different internationally among product, services and training?
DC: In the U.S., we still tend to sell more directly. Therefore, we sell more services. Overseas, our partners perform more of the services for us and our product revenues are higher. We’re trying to get our U.S. partners to be more like our international partners.

Chicago-based Accenture is currently working with us in the U.S. While they take a while to get up to speed, they will be self service and pick up more of the services for us.

Our leverage as a software company is getting others to do the services. That enables us to expand much more rapidly. Also, the partners know the customers, the underlying data warehouses and the opportunities.

MM commentary: Revenues from services can be a great value add for foreign partners. They install your software and get to charge and bill their customers for the installation, maintenance and support of it.

MM: Do you ever set up exclusive arrangements overseas?
DC: No. We don’t do exclusives. We will, though, grant market restrictions if a partner is going to invest and build the market.

For example, if a partner invests $250,000 up front in market development for ADVIZOR products, we might say that we won’t bring on any other partners for 12 months that directly compete. We have done this in Japan.

These tend to be special cases. Most of our relationships are open. We often get asked in the United Kingdom if we can be exclusive. The answer is no. If Accenture, for example, comes along and wants to work with us in the U.K., we would have a problem.

MM commentary: While foreign representatives will typically ask for geographical exclusivity, it’s rarely worth granting. Unless there is some compelling reason (such as a dominant local monopoly position), it doesn’t usually make sense to compromise a competitive environment.

Tune in next Tuesday for part two of this Q&A where we will explore
international investors and which countries are hot for software synergies.

Michael Muth is managing director of GATA, an international business development consultancy that helps technology companies build international partnerships. He can be reached at mike@intlalliances.com.
Click here for Muth’s full biography.

Previous Columns:
Q&A: CEO Terry Howerton on Why Chicago, Ukraine Made FastRoot (6/22/2004)
Q&A: FastRoot CEO Terry Howerton on Blended Chicago Approach (6/15/2004)

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