FinancialForce.com acquires Less Software and Vana - sets up suite play

Profile picture for user gonzodaddy By Den Howlett November 18, 2013
Summary:
FinancialForce.com's acquisition of vendors in the HR and supply chain spaces sets up an interesting scenario around FinancialForce.com becoming a platform play of its own. Here's why.

In and among the gazillion press releases pouring out of Dreamforce, FinancialForce.com announced it is acquiring Less Software and Vana Workforce. Who? What?

I've known about the Less deal for some time since FinancialForce.com consults with me on product topics. From the blurbs re Less:

The cloud application suite allows companies to acquire, manage and sell inventory efficiently by automating the logistics and order fulfillment process. This acquisition represents a significant step in FinancialForce.com’s vision to build a borderless back office by eliminating barriers inside and outside an organization, including those that prevent companies from forming closer relationships with their customers and suppliers.

And from the blurbs re: Vana:

Vana Workforce, to be re-branded as FinancialForce Human Capital Management (HCM), provides integrated HRMS, talent management and recruitment capabilities, allowing a consistent user experience across these solutions. As a native application built on the Salesforce Platform, the new application will be instantly unified with FinancialForce Accounting and FinancialForce Professional Services Automation (PSA), creating a single line of sight across an organization. This will allow true, front to back office visibility and a single user experience across the entire enterprise.

Both of these statements signal the beginning of a suite play on the Force.com platform but with some added twists.

In a conversation with Jeremy Roche, CEO FinancialForce.com, we discussed the potential for FinancialForce.com to become a platform in its own right. It strikes me this is exactly what customers will want because the enlarged offering can act as the hub through which both customers and suppliers interact as part of seamless, end to end processes. An example illustrates.

Frictionless process

Let's say you make short run custom widgets that are price dependent upon the use of certain commodities. You will likely have contract clauses that include an express ability to change prices according to the spot price of those commodities. Suppliers could be brought into the quote process through price updates. These could in turn be put through an operational analysis tool designed to offer cost impact predictions. That in turn could be used to price adjust out to customers.

Having everything on a single platform significantly reduces friction and provides the kind of transparency that customers love. FInancialForce.com customers will likely be prepared to pay more to help their ecosystem partners gain access because the value add to decision makers is way beyond the cost of additional license capability.

Now - this example is very specific but having all the components to truly talk 'end to end' opens up the potential to develop libraries of industry specific process objects that themselves can be tweaked on an as needed basis. This is eminently do-able on the Force.com platform so why wouldn't FinancialForce.com be that platform? It just makes so much sense.

The opportunity

Apart from the fact we can see obvious opportunity outlined above, FinancialForce.com has a limited time in which to get this play in motion. I reckon the window is two years. That's about the time it will take SAP to refactor Business ByDesign and come back to market with the suite on cloud story. Regardless of what anyone else thinks, SAP has the means and money to out-market FinancialForce.com any day it chooses but by effectively being 'off the table' for the time being, it is dropping FinancialForce.com the gift of a lifetime.

What's interesting here is that FinancialForce.com is demonstrating a unique capability in cloud landscapes where a platform exists from which to build out offerings. In the conversation with Roche, I remarked that CODA, the UK based accounting solution that is also part of the UNIT4 parent, never managed this kind of breakthrough growth opportunity. Roche pointed out that while crucially important to customers as an accounting back end, CODA was always going to be limited in terms of user reach. These acquisitions totally change that reach issue. Now, FinancialForce.com has the potential to reach everyone inside the customer's company and beyond. That's a huge potential prize and a very powerful message for both existing and net new customers.

As a side effect, FinancialForce.com can now legitimately become a Salesforce.com reseller. With skin in the games of accounting, HR, supply chain and billing, Salesforce's CRM is a neat way to package it all up. Now - who would ever thought that possible a few years ago?

Disclosure: FinancialForce.com, Salesforce and SAP are premier partners.