Informatica Analyst Event: Matter-of-Fact

As part of Saugatuck’s ongoing and growing work in the role(s) of data integration and Cloud (1024RA, Cloud-based Data Integration Changes Business for Enterprises and Providers, 16Feb2012), I had the good fortune to participate this week in Informatica’s annual analyst briefings in Silicon Valley. After two packed days of give and take on Informatica’s vision, strategy, tactics, plans and offerings, it’s fair to say that the company understands where it sits, where their real opportunities are, what their business goals should be, and how to approach and achieve those goals.

Granted, that sounds rather “business as usual.” But that’s what makes Informatica rather unique in a market environment rife with hype about Big Data, Cloud, mobility, social IT, and so on. There’s a company strategy roadmap that was really developed years ago, and which has been tweaked around the edges a few times, but which has remained largely intact and carefully followed as the markets have changed and evolved around it. Informatica does not ignore those market changes, but continually seeks and works to redefine how the market perceives it and its offerings within the latest paradigms. It does not ignore important changes and trends, nor does it pander to them. At its own bottom line, Informatica resolutely remains the same: Focused on data integration.

This means that Informatica finds itself well-positioned to take advantage of the current renaissance of data awareness. We see the company doing so very pragmatically and matter-of-factly. For example: The Informatica Cloud offering, which we reckon to be the fastest-growing and apparently the most profitable group within Informatica because it follows an almost ingeniously practical sales strategy: Sell to partners that have already educated and sold prospects on Cloud-based, data-generating, business applications that could be made more beneficial to the customer via data integration. It’s like selling napkins to diners at a rib restaurant.

Though its vision is clear, Informatica has room to improve in many areas. For example, they have a spot-on vision of how and why mobility is generating some revolutionary uses of data for business – but still have a ways to go when it comes to articulating their mobility data integration value proposition for enterprise IT. Another example: While useful and valuable, the Informatica Cloud offering right now can be considered “table stakes,” a first layer in what should be a growing stack of Cloud-based data integration services, including eventual offerings of integration-as-a-service embedded in Cloud platforms and/or SaaS applications. But the current entry is more than adequate for what the vast majority of likely and potential users could benefit from at this point in time.

Saugatuck’s net take on the company and its event: Data integration ain’t glamorous, and INFA ain’t trying to make it so. There’s no hype, no glitz, just figuring out how and where the company delivers value through customer’s use of data. Therein lies one of Informatica’s greatest challenges: The value of data.

Hours of discussion on the subject were generated in large part by Informatica’s own repetition and emphasis on a theme of “return on data,” including a nifty but unquantifiable formula: Return on data = Value of data / Cost of data. Several analysts, along with Informatica MDM SVP and GM Dennis Moore, went ‘round and ‘round with ideas and models for quantifying the value of business data. Saugatuck’s own research team is having its own internal discussions on the topic, which should be presented over the next week or so for our premium CRS subscription clients.

But the net for Informatica is that it really needs to find realistic means of quantifying that business value of data in order to get customers, partners, and analysts to buy into its theme. Intuitively, the concept makes sense and feels right; but when a concept is used to get customers to invest in an offering, it has to be factual as well.