One Vendor’s Mission to Make Service Businesses Click - Part 3

Part 1 of this blog series introduced ClickSoftware Technologies (NASDAQ: CKSW), which until recently had focused solely on workforce and service optimization software solutions for large field service companies. Gradually, via both internal development and a few appetizing acquisitions in 2009, the vendor added a few important growth engines, such as mobile computing solutions, shift planning (rostering) solutions, and solutions for the Small to Medium Businesses (SMBs).

Part 2 then analyzed the individual modules and logical bundles of the vendor’s flagship Service Optimization Suite as well as a number of original concepts that have differentiated ClickSoftware in the field service workforce optimization market. One of these concepts is the so-called real-time service enterprise

There is No Real-Time Service Enterprise Without Mobility

Closely related to the real-time service enterprise is the company’s Mobility Suite, which came out in 2006 (as mentioned in Part 2). In fact, with tight integration to the ClickSchedule module’s optimization capabilities, the vendor is confident that it now has the best mobile solution on the market.

ClickSoftware’s mobility solutions support high-end devices such as Microsoft Windows-based rugged laptops and tablets and Windows Mobile-based devices, as well as more consumer-oriented smartphones. This device choice comes through separate product editions and technologies, including high-functionality local client software (i.e., ClickMobile Advanced) as well as a combination of online and offline functionality with very low-footprint devices, based on HTML5 (i.e., ClickMobile Professional)

The Mobility Suite does not require that the users commit to a specific MEAP (Mobile Enterprise Application Platform). Thus, it is a business application platform that may work on top of the user's choice of underlying mobile infrastructure (e.g. local database, synchronization, communication management, and device management). The suite currently supports both Microsoft's and SAP Sybase's mobile infrastructure.

Over the last 18 months or so, while there has been strong demand for ClickSoftware’s breadwinning optimized scheduling solution, the area of mobility has reportedly experienced even larger demand. ClickSoftware now has over 50 customers who have purchased and, in many cases, implemented ClickMobile. This includes companies with thousands of mobile users (e.g., Sempra Energy, Ericsson, and Cable and Wireless) as well as smaller customers with hundreds of users.

In some of these mobile deals, the vendor reportedly replaced Ventyx or Syclo (which until recently have dominated the mobility space) simply because the customer has recognized that ClickSoftware’s mobility solution would enable the organization to take a giant leap forward in its mobile capabilities. Conversely, these clients were deterred by their perception of Ventyx and Syclo as proprietary and/or mature mobile platforms, and by issues with development speed and flexibility as well as scalability.

Going Social Amid Mobile Workforce

My recent blog post briefly mentioned how ServiceMax (formerly Maxplore) uses’s Chatter social platform to drive workforce collaboration in the field. Well, ClickSoftware customers have been using similar capabilities for a number of years, although under the less catchy title of “Service Optimization Suite Messaging”.

ClickSoftware’s messaging solution includes direct messages (one-to-one), broadcast messages to groups (to, e.g., “technicians now on duty in my area” or “technicians with experience on device X”), messages to specific roles (e.g.,“dispatchers for my region”), etc. Itwas designed from the ground up for the needs of a mobile workforce. As the first example of this claim, message delivery is guaranteed – that is, a technician who does not have mobile network access (or signal) can still send a message, which will remain on the mobile device until the first opportunity for transmission.

As a second example, the mobile device lets technicians create pre-written messages, so that very little typing is required on the fly. ClickSoftware messaging also supports automation at the back-end – e.g. automated agents can send messages (e.g. traffic warnings) or scan incoming messages and trigger automated actions. Acceptance for the messaging system, as well as for other mobile collaboration (e.g. “peer radar” which shows, on the mobile device, the distance and direction of nearby colleagues), has been enthusiastic.

ClickSoftware continues to innovate around social media for field service and has presented a number of different ideas to some of its business-to-consumer (B2C) clients (e.g., the consumer’s ability to book service visits and appointments via Facebook). In many cases, companies are only slowly recognizing the impact that these tools can have on their business, but it is becoming clear that first-movers in this area will gain large benefits in customer satisfaction and in cost-cutting.

Interoperability as Another Differentiating Trait

As outlined in AMR Research’s 2006 book entitled “The Future of Enterprise Applications,” large enterprise application companies have long been in control of manufacturing and customer data. They then grew into the service space to expand their reach into the businesses of clients. They began offering a host of modular products aimed at responding to end-customer needs, such as call center management, order management, and contract management. Soon those needs evolved into scheduling and dispatch and parts management, ultimately culminating in strategic service management (SSM) suites that are capable of managing large installations such as oil rigs and manufacturing plants.

ClickSoftware is certainly not a complete solution for all facets of SSM or service lifecycle management (SLM). For example, the vendor’s solutions do not handle contracts, invoices, spare parts planning & pricing, preventive maintenance planning, customer relationship management (CRM), inventory management (although “last mile” parts management, including parts pickup and delivery and in-van stock, is supported and optimized by ClickSoftware’s solution), reverse logistics, and so on and so forth. Unless, of course, they are bundled with SAP ERP and/or IBM Maximo. ClickSoftware also has several customers for whom a full enterprise resource planning (ERP) and/or enterprise asset management (EAM) solution is overkill, and for these customers it has several modules which do provide the specific functionality required.

Aftermarket services are complex, spanning multiple corporate divisions, partners, geographies, and technologies. As such, customers are requesting that all vendors rebuild their systems based on a service oriented architecture (SOA) strategy. This should make it easier for customers to configure, deploy, and manage their systems. It should also help them respond more quickly to market and process changes.

In other words, interoperability with other solutions is a must. Thus, from the earliest versions, ClickSoftware delivered integration capability using Extensible Markup Language (XML) messages and Web services (for those customers whose IT strategy is based on SOA), with a large and well-documented set of APIs (Application Program Interfaces) for interacting with any aspect of the field service management process.

Who Uses ClickSoftware?

Today, ClickSoftware has over 200 customers covering numerous industries, geographies, and size of field force. Its service optimization solutions are utilized by leading organizations in a number of service industry segments, including: utilities and energy, telecommunications, retail, insurance, high-technology, computer and office equipment, industrial equipment, medical equipment, building automation, public security, and home services.

Depending on the solution, the ‘sweet spot’ varies. For the on-demand entry-level ServiceTycoon solution (mentioned in Part 1), any service business with 5 to 20 field employees would be a good fit. Conversely, for the vendor’s enterprise-class suite of solutions, any service organization with more than 100 field employees would be appropriate, and some customers surpass 20,000 users.

ClickSoftware’s largest vertical market traditionally have been the utility and telecommunications markets. The vendor takes great pride in the fact that its products were used to schedule the telecommunication technicians at one of the greatest spectacles in 2008, the Beijing Olympic Games.

The utility market, which has benefited from deregulation and modernization trends, has been a significant market in recent years. There are typically large field forces with complex scheduling and mobility requirements in utilities’ environments. ClickSoftware’s market dominance in the utilities industry is well reflected in the North American West Coast, where it serves companies all the way from Terasen Gas and BC Hydro in Northern Canada and Pacific Gas & Electric in the San Francisco area, to Southern California Edison in the Los Angeles and Orange County area, and the aforementioned Sempra Energy in the San-Diego and Orange County area. 

In terms of industry verticals, approximately 70 percent of ClickSoftware revenues comes from telecommunications and utility companies, with the rest coming from office equipment, home services, retail, insurance and others. The relative resilience of the utilities and telecommunications sector to economic cycles has compensated for the relatively weak business in other industries that have been more severely impacted by the economic downturn, leading to a remarkably consistent annual growth rate of around or over 20 percent since 2005.

Global Presence

ClickSoftware markets and sells its products mostly through its direct sales force located in North America, Europe, and the Asia Pacific region, as well as through reseller agreements with partners. As said in Part 1, the company has offices in North America, the United Kingdom (UK), Germany, Israel, Japan, Australia, and India. Most other countries are supported through the company’s partner network.

The geographic mix of the company’s revenues has been well balanced,

typically consisting of around 40 percent coming from North America, 40 percent from
Europe, and the rest from Asia Pacific, though this varies year by year. Out-of-the-box the product is available in four languages (English, Japanese, German, and French). However, the vendor can localize its solutions for any language in the Microsoft technology world, and there are many deployments in Spanish, Chinese, and Hebrew.ClickSoftware’s business relationships with large ERP, CRM, and EAM vendors enable it to use its partners' market presence and sales channels to create additional revenue opportunities. The vendor’s strategy is focused on establishing and maintaining relationships with approved certified standard interface adaptors that enable rapid integration and implementation of its products into other major ERP, CRM, and EAM systems.

The Important SAP Alliance

In 2008, ClickSoftware entered into a global reseller agreement with SAP, pursuant to which SAP has been reselling the Service Optimization Suite. ClickSoftware is an SAP Solution Extension (SOLEX) Partner, whereby SAP resells ClickSoftware’s Service Optimization Suite as the SAP Workforce Scheduling and Optimization application by ClickSoftware (SAP WS&O), thus helping customers meet the challenge of optimizing the mobile service workforce.

SAP Workforce Scheduling and Optimization Suite by ClickSoftware includes all of the ClickSoftware products broken down into four different bundles. ClickSoftware’s products are included on SAP’s global pricelist in specified bundles, and sold under the standard SAP end-user license agreement (EULA) and global support commitments.

With a rapidly growing number of customers thus far, the alliance with SAP has increased ClickSoftware’s presence in its existing markets and has assisted with introducing its products into new markets. This vote of confidence has also come via SAP’s own marketing efforts that have extended ClickSoftware’s reach into new geographical regions and vertical markets.

This partnership mitigates the notion of ClickSoftware being an incomplete solution for end-to-end service processes (i.e., the solution has been seen by some as an expensive standalone best-of-breed add-on, which often requires additional cost justification). In addition, given the prevalence of Java- and ABAP-based products in the SAP ecosystem, it is interesting to note that ClickSoftware’s Microsoft .NET Framework orientation was not a deterrent for SAP. This endorsement by SAP should thus also alleviate possible concerns by some prospects that are not inclined toward the .NET architecture.

The SAP Alliance, already strong and successful, has received another boost with SAP’s acquisition of Sybase. Since ClickSoftware’s Mobility Suite works on top of Sybase mobile technologies, this creates yet another driver for the alliance. As Terry Stepien, president, Sybase iAnywhere, said the following in the recent press release:
“By implementing ClickSoftware’s mobile applications on components of the Sybase mobility platform, the service industry benefits from an integrated offering from two industry leaders; proven mobility infrastructure from Sybase and proven mobile applications from ClickSoftware. This partnership will transform ClickSoftware’s customers through highly productive enterprise mobility solutions. We look forward to growing this partnership into 2011 and beyond.”

Keeping Its Eggs in Multiple Baskets

ClickSoftware has also established relationships with large system integrator (SI) and consulting organizations, such as Accenture, IBM, HCL AXON and Capgemini. These marquee partners provide various levels of resources to integrate, customize, and implement the vendor’s solutions.

Depending on the strength of the relationship, ClickSoftware has co-invested in jointly developing industry-specific solutions, training and certifying the partner's professional services teams, developing co-marketing programs, and incorporating into products into their marketing/referral strategies. In addition, in 2004 ClickSoftware formed a strategic alliance with IBM, pursuant to which IBM resells ClickSoftware’s workforce optimization solutions (often integrated to IBM Maximo). The final part of this series will recap the company’s strengths and point out some still outstanding challenges. Your views, comments, and opinions about ClickSoftware’s strategy to cater to both large and smaller customers in multiple industries, or experiences with any above-mentioned solution are welcome in the meantime. 
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