i4C Deal Adds to Accenture's Appeal to Line-of-Business Buyers

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Summary

With i4C Analytics technology, Accenture could offer a hybrid advanced analytics offering that encompasses established software and services. This will also add flexibility to Accenture’s build, buy and outsource options.

News Analysis

Event

On 30 April 2014, Accenture announced that it has entered into an agreement to acquire i4C Analytics, a Milan-based advanced analytics software platform vendor. The firms did not disclose the financial terms of the deal, but Accenture said it plans to integrate i4C into Accenture Analytics, as part of Accenture Digital.

Analysis

This deal helps Accenture advance toward becoming one of the few firms in the business intelligence and analytics software market with a "triple play" offering of build, buy and outsource solutions incorporating established products and services. Combining i4C technology with Accenture Analytics offerings will enable Accenture customers to choose among building custom advanced analytics solutions, buying apps based on Application Configuration Environment (ACE) from i4C's app store, or using Accenture's outsourcing services. This would enable Accenture to appeal to buyers in the line of business as well as those within the IT organization.

An Accenture offering could become a model for providers that are seeking to develop hybrid service and product offerings and attract line-of-business buyers. The lines between traditional software vendors and implementation services continue to blur as vendors vie for a larger wallet share. This acquisition further endorses Gartner’s prediction that by 2017, analytic applications offered by software vendors will be indistinguishable from analytic applications offered by service providers (see "Predicts 2014: Business Intelligence and Analytics Will Remain CIO's Top Technology Priority" ).

i4C has primarily catered to Italian customers; its top three are in the insurance, utility, and oil and gas industries. i4C ACE is a scalable platform that enables agile development of advanced analytics apps that are easy for customers to access, integrate with their workflow processes and understand. But i4C lacked the resources and expertise to broaden the appeal of its platform to other industries or geographies, and required a capital infusion or a strong sales partnership, which Accenture will provide. Accenture gains:

  • Predictive, optimization and forecasting abilities, which will enable Accenture to better streamline its production of new predictive and prescriptive analytics applications — particularly the latter, currently lacking in the analytics market.

  • Access to a solid technology base, enabling it to add i4C's analytics apps and analytics platform approach to Accenture's service offerings — in particular across its operations-related services, which could result in cloud solutions.

  • Complementary industry expertise in certain segments and targeted applications that could integrate with its technology platform offerings.

Deals like this confirm that advanced analytics is the fastest-growing segment within the business analytics and intelligence software market (see "Market Share Analysis: Business Intelligence and Analytics Software, 2013" ). The rise of big data and the business need to optimize operations have led demand for these capabilities to outpace the supply of expert users and created requirements for "non-data-scientist-friendly" tools.

Recommendations

  • i4C customers: Expect some short-term disruption as Accenture reassesses i4C road map priorities and integrates i4C into Accenture Analytics.

  • Accenture customers: Continue with planned or in-progress initiatives, as they are unlikely to be affected during the next three to nine months. Integration of the smaller-scale i4C with a global firm like Accenture will take time. In the longer term, prepare for new analytics applications based on i4C and for more choices and greater flexibility in build, buy and outsource options.

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