Objective will not be sold, despite ECM buying spree

Sharp downward movement in its share price in the past year caused by increased spending on research and development, says chief executive

A private equity buyout of Tower Software, which sells the Trim enterprise content management software, is the latest in a string of acquisitions in the sector.

The past few years have seen IBM buy FileNet, Oracle acquire Stellent, EMC buy Documentum, Interwoven buy iManage, and, most recently, Open Text acquire Hummingbird. One of the major drivers behind the purchases is the need to meet new, more stringent regulations such as Sarbannes-Oxley; another is the sheer volume of content that needs to be managed efficiently.

However, one company that won’t be bought, according to chief executive Tony Walls, is Objective Corporation. The ASX-listed company has experienced sharp downward movement in its share price in the past year, but Walls has a simple explanation.

“The two major shareholders (Walls is one) hold 85% of the shares. Two years ago, we increased our spending on research and development by 75%. That’s meant lower dividends, so there has been some sell-off. But we will never sell off,” he told Computerworld in Sydney recently.

According to research company Frost & Sullivan, Objective is the major ECM (enterprise content management) player in Australia, with 26% of the total market. In New Zealand, it has been dominant in the public sector in recent years.

New customers acquired last year include the Crown Company Monitoring Unit, Land Information New Zealand, and Parliament’s Office of the Clerk, as well as Genesis Energy. Objective had previously signed up the Ministry of Social Development, the Tertiary Education Commission, the Parliamentary Service, Land Transport New Zealand, Pharmac and Archives New Zealand.

Walls first established the company 20 years ago. He eventually came to the view that Objective could do better developing its own software, rather than selling US document management products, and, in 1993, the company sold its first software, after some years of development.

“We were one of the pioneers in this space in Australia,” he says.

The company’s “gold” is its workflow engine, which works at the business process layer, says marketing general manager Peter Kokinakas.

“The business process is what adds value to a CEO’s day,” he says.

“They see compliance as another cost; their eyes glaze over. But process is about how to get to market. Our workflow engine will also manage the customer’s key performance indicators.

“The CEO needs a repeatable quality process. Content is almost subsequent to that.”

Objective introduced version 7.0 of its software 18 months ago, a pivotal move to service-oriented architecture. At the same time, the workflow engine was redesigned to be case-centric rather than generic.

Version 8.0 is 18 months away. It is headed down the same path as most ECM software, to have a zero footprint. That means it sits with the operating system, reducing overhead at the client-end. Objective runs on disparate platforms, for example, Solaris, Windows on Oracle and SQLServer, or Linux.

Jackson travelled to Sydney as a guest of Objective

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Tags objectiveECMresearch and development

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