From the Top
- Executive to Executive -
RealMarket had the opportunity to catch up with Jim Grant, General Manager for the Remedy business at BMC. He’s been quite busy recently with a string of acquisitions as well as recapturing momentum lost during the Peregrine era of Remedy’s existence. Remedy has long been a player in the IT Service Management (ITSM) arena and is looking to further exploit the CRM opportunity.
Jim Grant,
Vice President and General Manager, Remedy
RealMarket: Good afternoon, Jim. I guess we should start the conversation talking about the current chapter of the Remedy story. How is Remedy now that you are a part of BMC?
Grant: I was hired to run Remedy about the time the companies were getting to know each other, back in March 2003. It was very obvious to me that the Peregrine acquisition of Remedy was very destructive. People felt Peregrine had done everything they could to dismantle the business since there was overlap with Peregrine technologies. However, Remedy sustained thanks to our very loyal installed base.
RealMarket: How much product overlap is there between Remedy and BMC?
Grant: BMC bought Remedy because they viewed the Remedy product line as an extension of BMC’s Business Service Management strategy. There were no overlapping technologies and the combination of the BSM strategy, complementary technologies, and artful integration by BMC made the acquisition successful. Peregrine had all the elements of an unsuccessful acquisition while BMC kept and cultivated Remedy’s intellectual property and the installed base. On top of that we now have strong development, sales, and marketing organizations backed by a successful, financially secure parent. The combination of the extended Remedy family of products, including Magic and Marimba, and BMC products, gives us an angle that HP and CA don’t have.
| As business processes take center stage, ITSM starts to bounce up against CRM, since both are focused on serving the “customer” – whether the customers is an employee or a paying customer. And in the future, there will only be one service desk. It will serve both internal and external customer support needs. |
RealMarket: You offer both ITSM and CRM solutions. Do you think you can be successful doing both?
Grant: Let me drop back a little bit and give you my perspective of the software market. We have been in the IT Service Management (ITSM) market for more than 15 years. In addition, we are in the CRM space primarily from a service and support perspective. As business processes take center stage, ITSM starts to bounce up against CRM, since both are focused on serving the “customer” – whether the customers is an employee or a paying customer. And in the future, there will only be one service desk. It will serve both internal and external customer support needs.
RealMarket: Why do you think there will only be one service desk serving both internal and external customers?
Grant: If the process of service is similar for internal and external customers, why wouldn’t you have one service desk? Over time, the lines blur between computer support and customer support. Now, integrated workflow across scenarios becomes the important issue. This is not a “block out the sun” idea. It is merely the recognition of accessing data in a common way, moving data in a common way and using common models.
| Siebel came from sales force automation, SAP from enterprise resource planning and PeopleSoft from human resources. They are all headed toward the same convergence but Remedy has been here all along. |
RealMarket: It seems you are putting quite a bit of emphasis on business process. Why?
Grant: We are developing solutions to solve a broader problem. Service Management, in BMC terms, is Business Service Management. It’s simply an extension of the business and how IT aligns to the needs of the business. If you ask an IT person what they do or how they view their career path, many times the answer is based on the technology they know, like Microsoft NT or Remedy Customer Support. But that is changing. More and more, the common answer will be a business function or business service they support, like an online ordering system or keeping the production line up.
RealMarket: Is this a Remedy or a BMC perspective?
Grant: It’s one in the same. Of course BMC has quite a bit of depth in infrastructure management. But they realize that they will eventually hit the proverbial wall, so they extended the solution to business processes. We know that companies need to manage a service, – a business service.
RealMarket: Does this perspective change business as we know it?
Grant: I’m not talking about a drastic event in the market. However, as more IT organizations turn their views about technology ninety degrees, they will start to make the move to convergence. When that is done, processes that are service oriented like ITIL become more important. I see it as one revolution comparable to Deming or Six Sigma.
RealMarket: Who do you find as Remedy’s primary short list competitors?
| Not everyone can afford a diesel truck when they only need a small pick-up. The point is that designing for mid-tier and large enterprise is different. The Magic acquisition allowed us to address a broader market. |
Grant: First, we need to ask, where does support start and IT end? It is a bit confused in terms of a short list right now because of that. For our customer support solutions, Siebel is the primary competitor but we occasionally see Peoplesoft or SAP. All these players came from a non-service perspective. Siebel came from sales force automation, SAP from enterprise resource planning and PeopleSoft from human resources. They are all headed toward the same convergence but Remedy has been here all along. None of them have the Business Service Management advantage. That is where BMC shines. We are creating things that can automate and balance a complete service.
RealMarket: So with all the different solution providers, what do you see happening in the market?
Grant: I see a post-2000 consolidation. Companies are unwilling to spend their budget among 50+ vendors and create a more customized workflow to patch it together. It’s just too big an effort. I call that “hot rod software.” Businesses don’t want to spend the money to create hot rods because they are in the business of something else. The major trend is that businesses have figured it out. Over time, there will be fewer and fewer vendors but there will still be plenty from which to choose. However the successful vendors will be those that offer more value by solving bigger business problems rather than an IT administration or application problem.
RealMarket: Does that mean the BMC and Remedy code base will converge?
Grant: The idea of one technology base is not appropriate for the technologies we’re discussing here. Yes, we are architecting more as one company. For instance, major elements like asset and change repositories and how you access, change, and manipulate elements will be common. Other vendors don’t provide one place for information and services. I include services in that statement because services are assets. Bottom line is that we have a tightly integrated solution with a great deal of common code. That can’t be matched by the competition.
RealMarket: In the last few months you’ve been quite busy making acquisitions. Tell us why you are buying companies rather than relying on internal development.
Grant: Yes, we have been busy. Let me talk about three acquisitions. The first one is Magic Solutions. They have a good technology set and have always been focused on the small to medium business segment. Traditional Remedy solutions focus more on the mid-range to enterprise market. Historically, we would bump into issues when we tried to go down market. Not everyone can afford a diesel truck when they only need a small pick-up. The point is that designing for mid-tier and large enterprise is different. The Magic acquisition allowed us to address a broader market.
The next acquisition is Marimba. They’ve been around almost 10 years and have a very active base of configuration and provisioning tools. We recognized that the vast majority of outages are based on availability and performance. So marrying change management from Remedy and BMC with the active provisioning from Marimba gives us the ability to provide true business change management. We’re well on our way to being the market leader of change management.
The third acquisition is Viadyne. They were a small company of 29 employees and they had built a high-end service desk, using Remedy’s Action Request System, for outsourcers by providing multi-tenant or multi-client capabilities from a single server instance. Viadyne makes for a nice extension to our product offering.
| Don’t fall in the habit of technology at the expense of process. Always ask yourself, “What are the most important processes?” |
RealMarket: What is the average size implementation? What is the range and what percent are implementation services?
Grant: It varies by application. Magic has the shortest implementation cycle typically measured in days to weeks. For Remedy implementation is measured in weeks to months depending on size. Acquisition cost of Remedy ranges from $30K to over a million dollars for some of the largest corporations in the world.
RealMarket: You’ve seen so many implementations. What advice do you have for others just getting ready to undertake an implementation?
Grant: If an IT organization does not have strong processes the software is not going to run well. If you don’t have a process, get a process. When you do that, make sure you are supporting a business not a technology. Don’t fall in the habit of technology at the expense of process. Always ask yourself, “What are the most important processes?”
RealMarket: What keeps you up at night?
Grant: I want to keep being better than our competitors. Vendors are always trying to bring out the next big thing from a competitive standpoint. We need to make sure that we keep providing value everyday from the technology and with good technical direction. We want to stay tuned to where our customers are and, most importantly, where they are going.
RealMarket: Looking to the future, what is the biggest change you see on the horizon?
Grant: I think it is happening already. The Internet was going to change everything, especially how businesses interact online. That happened in a relatively short time. Just consider what we can do now versus five years ago. The way businesses use the Internet to reach out has become quite artful and now we need to support businesses to in that effort. The promise lived up to everything it was supposed to be and more. It will be fun to watch the business world continue to evolve. I look forward to seeing Remedy’s and BMC Software’s solutions continue to change our industry. Basically, if you provide value, you win.
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