Downturn spells opportunity for Nexala


20 Mar 2003

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With the outlook for the economy looking increasingly gloomy, organisations will freeze new IT projects and instead look to squeeze the maximum value from their existing IT infrastructure. At least that’s the fervent hope of Dun Laoghaire-based start-up Nexala Technologies.

Nexala was formed in January by three experienced software executives – Karl O’Connell (president and CEO), former executive vice-president of business development and CTO at CRM (customer relationship management) developer Norkom, his brother, Marcus (chief technology officer – pictured), the former CTO of Japanese tech firm Jeecom Inc, and Paul Lowry (head of sales and marketing) who was previously responsible for building the UK and US business at both Norkom and Iona Technologies.

Nexala is funded by private investors, Enterprise Ireland, Venture Point as well as investment from the founders themselves.

Nexala has already launched its first product, appointed two distributors and signed its first customer – not bad for a company just weeks old. The key to this rapid progress was its acquisition of Enterprise Java-based technology from Jeecom, which forms the cornerstone of Nexala’s software applications.

Nexala’s products come under the umbrella of business activity management (BAM) software. BAM technology is pitched at large organisations. It sits on top of existing large-scale CRM and enterprise resource planning systems and hoovers up relevant information to enable the organisation to manage its business activities more effectively.

If it sounds complex, it is, but according to leading analyst firm Gartner, BAM will be one of the top four initiatives driving IT strategy and investment in enterprises by 2004. And Nexala is one of the first Irish companies to be active in this emerging market.

“There are some companies focusing on specific areas but we’re focusing on the whole intelligence or decision support aspect, which involves analysing information and making recommendations to users,” says Marcus O’Connell.

The decision-making aspect of Nexala’s technology is its key feature. In other words, it doesn’t just select relevant information, it analyses it, weighs it up and then takes action. It is early days for the technology but a number of niche applications are beginning to emerge. Supply chain assurance is one.

O’Connell explains: “If you have service level agreements and you see a service level is about to be breached, the system will look at that and find the root cause – a supplier problem for example. It will then look at other suppliers that can supply similar components and will issue a recommendation saying, ‘there’s a problem with a particular supplier; here is a list of other suppliers you can switch to’.”

In addition to supply chain applications, Nexala is focusing on three other areas: self service, which allows customers and employees to request information they may need on any product or service through any channel – SMS (short messaging service), web or email; key performance indicator monitoring and management and sales force mobilisation – providing sales staff and other mobile employees with timely and relevant information via PDAs (personal digital assistants), laptops and mobile phones. The system supports two-way interaction in that information can either be pushed out to employees or they can request it.

It is regularly observed of Irish technology companies that while their software is world class their selling skills can sometimes let them down. So how is Nexala going persuade companies that its technology is going to make a big difference to their business and put their hands in their pockets?

“I think the bottom line is that you can see the return on investment and the value of the solution very quickly,” O’Connell remarks. “We’re not going in and saying you have to replace your existing systems; it’s about taking the existing systems and now that you have all these information silos in place, look at what you can do with them.”

In terms of competition, can Nexala expect to come up against business applications giants like Siebel and SAP which might feel threatened by the whole concept of BAM software? O’Connell emphasises that Nexala applications are not intended to compete with existing systems but to enhance their value: “The real value of Nexala technology is being able to bridge across multiple vendors’ products – SAP being one of them – and overlay real-time decision support on top of them.”

Nexala’s first customer is well-known UK leasing company
Fleet Management, which uses Nexala’s software for inventory analysis. The company has also signed French consulting partner Muir International and Spanish distributor Big Wireless to expand Nexala’s European presence. The company is not neglecting the US either. O’Connell says there are “definite plans” to enter the US market later in the year by way of a local sales operation.

All product development takes place at home in Dun Laoghaire where Nexala currently has six staff.

By Brian Skelly