Accenture Goes the Tailor-Made RouteDamian Joseph
Creating IT hardware on your own can be real chore. All that time and money spent researching and prototyping, and there's no guarantee it will do the job. But what if getting a custom-built device were as easy as making pizza? Start with a crust of a base module to run an operating system. Add a few toppings—a GPS unit, an accelerometer, a motion detector, or a 3G connection—and you've got just what your company needs.
Accenture (ACN) is now in this pizza biz. The consulting giant has teamed up with Bug Labs, a New York startup, to offer hardware and software packages unique to each customer. For Accenture the payoff is in getting these buyers to subscribe to its new software platform, AMOS, or Accenture Mobility Operated Services. As for Bug Labs, its wager is that Accenture will open doors to big companies that will put in multiple orders for its snap-together computerized gear.
The advantage for would-be customers is that the hardware can be tailored to fit an individual company. A shipping company might be able to buy a regular GPS unit at an electronics store, but what if it needs the device to have a 3G connection to send information over a cellular network? What if it also needs that device to have an accelerometer, so the company can track accidents?
A Break from ConventionAccenture's AMOS software then processes information taken from Bug's devices. If a shipping company uses the fleet-tracking device, for example, it could log onto the AMOS Web site that will produce mapped routes, accident reports, vehicle histories, and other calculations. Other industries can create devices unique to their own specs with components such as wireless Internet, a motion detector, a digital camera, or USB plugs.
The move is a break from Accenture's conventional business model. Before, the $25.3 billion company typically waited for clients to come to its consultants with problems. Now it's pitching products and services to any and all who might need them. "This is different for us," says Andrew Zimmerman, managing director of Accenture's New Business group. "Hardware was a little bit of an afterthought before. Now we're being proactive."
In another radical depature, Accenture's new venture does not charge clients a consultant fee. The cost for AMOS is transaction-based, with billing based entirely on volume of use.
The system is plug-and-play. A base module runs open source Linux software, on which a business application can be written in as little as two days. Modules range in price from $69 to $450 for individual customers, but Bug typically sells bundles of hardware with support services to companies, depending on volume and support provided.
Bug Labs and the Big BoysBug Labs was founded only two years ago. The 15-employee company won't disclose revenue or profits, but it recently raised $16 million in venture capital and is already doing business with Pitney Bowes (PBI), Sun Microsystems (JAVA), Orange, Antenna Software, and Human Rights Watch. Accenture came across the company several times researching trivergence—that is, a networked device that has its controls and data located somewhere else on the network.
Accenture has a five-person team that is pitching the service to potential users with presentations and research findings, and giving hands-on demos at its innovation centers in Murray Hill, N.J., and Rome. Also—and this is where Accenture's contacts and credibility come in handy—its individual consultants, most of whom work with the world's largest 2,000 companies, are selling AMOS to clients and networking for new ones.
So far, after six months on the market, Accenture has created devices and software applications in health care, transportation, utilities, and security. Thirteen clients have signed up for AMOS, either in pilot projects or throughout their business, including Poste Italiane and Fiat.