Technology One's flagship product, Finance One, has been recognised as one of the most successful financial information management systems for the mid-range market in Australia, with the likes of Tattersalls, SportsGirl and The Salvation Army using it alongside some 200 customers at 400 different sites throughoutAustralia, New Zealand and Southeast Asia. This is not bad for a company that only a few years ago had its "oxygen supply cut off" by some of the financial market big guns, forcing it to embark on the second start in the cutthroat race for a piece of the financial market pie. Today, the Brisbane-headquartered company has an annual turnover of $25 million and is preparing to take its product overseas. Remarking that every first innings is hard, Adrian Di Marco, Technology One's managing director shares his thoughts on the financial management market with Tamara Plakalo.
ARN: What makes Finance One "the number one" financial product in Australia?
Di Marco: Quite a few things come to play. I think the product has been so successful here because we have targeted what we call the mid-range financials, that is the companies which are doing turnover of between 15 and 800 million dollars.
We picked that market niche and developed a product to suit it. SAP dominates the top-end and they've done a wonderful job in developing a product for that marketplace. But no one has really ever targeted the mid-range, which is quite interesting. So we developed a product that is ideally suited for the mid-market.
What were the main issues you had to address in developing your product for this particular segment of the Australian financial market? How different are mid-market requirements to those of top-end customers?
Functionality is important. In the mid-range, people are interested in a product that is not so much about processing the data. They are more interested in getting the information out - that is the key thing in the mid-market. Our product is architectured with the concept which we call "information at fingertips" in mind and that is something that our competitors are still trying to come to terms with, which gives us a product advantage over them.
Part of the information at fingertips concept is that people want their information - not only reports and enquiries, but also other formats with a simple point-and-click capability. Information at fingertips is also about mobility. People want to have access to information in their Sydney office today, at home tomorrow, in Melbourne the day after and in LA the day after that. Well, we do that. It is all based on the concept of dynamism, basically, people don't know today what information they will need tomorrow and they need to have access to it anywhere, anytime.
The other thing about companies in the mid-range market is that they are very conscious of getting returns on their investment, whereas at the top-end that is a secondary issue. At the top-end they'll spend a dollar for a licence fee and then another five to 10 dollars to implement it. With the mid-market, that is not the case. If they spend a dollar on a licence fee, they will not want to spend another dollar to implement the system.
So, implementation cost is a big issue.
Also, in the mid-range marketplace they want a "total relationship" with the company. We develop a product, we market it, we sell it, we implement it, we support it - it's a one-stop shop and we will take responsibility to make the whole process successful. That is again different to the top-end where, typically, the people who develop a product are different to people who sell and implement it, so, that's a quite fragmented relationship.
What are the driving issues in the development and management of financial software at the moment?
The thing that has really driven the financial software market over the last four or five years and will continue to drive it is the need to get information out of the system. We think that is the overriding requirement of this marketplace. We all process the data much the same way - it's getting the data out and into the manager's hands and empowering users by allowing them to make decisions they need - this is what's really driving companies today.
Their businesses are changing very quickly and they insist that we respond to that. So, we continue to grow our development process through the "information at your fingertips" concept.
Do you see smaller players like yourself being more able to mobilise resources and respond to the evolving needs of the financial market than the tier-one players?
If you look at PeopleSoft, they've been hugely successful. They've been in business for 10 years and they turned over close to one billion dollars. Their success is based on one factor alone - in 1987, when they started, they decided that client/server computing was the way of the future and they developed their products around this technology before SAP or anyone else, for that matter. And they have been hugely successful because of that, which just shows you that if you get in early, you can roll that way.
So, yes, the opportunity for smaller players lies in their ability to see where the technology is going, not to become self-focused in what they're doing. Microsoft and Oracle, for instance, are so entrenched in their view of the world that they don't see the next paradigm shift in computing and that's where the opportunity for new players to come into the marketplace is.
So, what will the next paradigm shift in computing be?
Aaaaahhh, well, that's the thing - we're not telling! We believe that the fundamental nature of systems does not change, but the way that you deliver them has to change and we have to redevelop our systems so that we can take advantage of it. People see bits and pieces of it, but the secret is to envisage the whole picture. Also, Australian software developers need to take a risk and use their intellectual capital in more adventurous ways. There is a lot of money to be made in this market and going against the big boys and winning has always been fun. Every time we win a deal, it's against Oracle or SAP or PeopleSoft and, hey, guess what, it's an Australian company winning the deal!