Wolters Kluwer Tax & Accounting announced today that it acquired Axentis. This acquisition further extends Wolters Kluwer role in the GRC (Governance, Risk, & Compliance) technology and content/information market.
Axentis, according to Corporate Integrity research, has a leading policy and procedure management platform. The company has done an excellent job at addressing investigations management and has specific addressed a broad array of GRC issues aimed to address corporate integrity agreements, risk management, ethics, code of conduct, corporate compliance, financial controls management, IT risk and compliance, regulatory intelligence/management, privacy, and vendor/supplier/3rd party compliance. Axentis has also been a pioneer of addressing GRC through a Software as a Service (SaaS) model.
Wolters Kluwer has been on track in acquiring a portfolio of GRC related products. Axentis adds to their line of acquisitions which include TeamMate, Sword, and MediRegs (ComplyTrack). Wolters Kluwer also has a range of other GRC related products that tackle issue of matter management as well as board & entity management. However, the most significant differentiator for Wolters Kluwer is the integration of content/information related to regulations and risks into these suite of products as they provide a competitive information and knowledge offering that competes against the like of Thomson, Lexis, and SAI Global. Some of these knowledge providers also see the value of GRC technology solutions integrating with content – Thomson Reuters acquired Paisley last November, and SAI Global acquired 80/20 Software among a few others.
The challenge now for Wolters Kluwer is to bring things together. To date they have focused on different solutions across their technology line and does not promote a single all-encompassing GRC application. This can work for as well as against them. If they can bring together a common back-end data architecture and deliver a consistent interface across individual products – I believe that organizations will buy this. If they fail to do this, other vendors will when the GRC game. Organizations do not necessarily need a single application interface for GRC – but they do need a common data architecture. I also see that many GRC vendors lose out because they try to oversell instead of addressing the specific needs set before them. Wolters Kluwer can sell to the specific need with the specific product and expand. This also helps penetrate deals as GRC involves multiple roles. Without confusing the buyer, Wolters Kluwer can sell the products to the meet the needs of the specific business buyer before them (e.g., legal, compliance, enterprise risk, operational risk, finance, audit).
As Thomson, SAI Global, and Wolters Kluwer have all demonstrated significant commitment to the GRC space, I am particularly curious about Lexis Nexis‘ reaction as to how they will approach this space.
The end game of the GRC market breaks down as follows:
- Enterprise technology providers. CA, Oracle, and SAP are all committed to the GRC space. These providers, as well as some to change focus to GRC again, will continue to expand and grow in the market. Their value proposition will be the integration of technology into a broader technology architecture.
- Information/knowledge providers. The likes of Wolters Kluwer and Thomson will focus on using technology to integrate with content – delivering on what I call risk and regulatory intelligence.
- Boutique providers. There will remain a number of GRC providers that utilize their smaller size to be nimble and react first to changing m arket demands and grow to be a solid GRC player, several of these players will differentiate themselves by delivering solutions aimed at specific GRC issues (e.g., environmental, health & safety, matter management) as well as roles (e.g., audit, legal, compliance, risk, IT).