FileNet: Something Old, Something New

By Baselinemag  |  Posted 2004-11-01 Email Print this article Print
 
 
 
 
 
 
 

FileNet's software appeals to customers that need to handle both paper and digital forms, though its older products can be tough to upgrade.


Sometimes a foot in the past helps a company spring into new markets. That's true for 22-year-old FileNet, whose business process management offerings are descendants of its original software products for scanning and storing paper documents.

Toyota Financial Services (TFS) Canada needed to incorporate an existing paper-based process to help it handle about 110,000 auto loans and leases a year. This February, the company began rolling out a system based on FileNet's eForms to process applications from dealers; now, 90% of its contracts are submitted electronically.

One reason it picked FileNet was that "FileNet enabled us to use existing fax machines that linked into the whole electronic process," says Larry Baldesarra, senior vice president at TFS Canada. As for working with the company, he says, "In any project like this, there are always ups and downs," but FileNet "understood their product well enough to help us solve the business problem."

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Other customers, though, have felt utterly ignored by the company. In 2000, AAA Missouri, a regional automobile association serving six Midwest states, deployed FileNet's Acenza workflow software to help distribute insurance claims. About a year ago, FileNet discontinued selling and developing that product; Bob Schreiber, AAA Missouri's vice president of insurance, says the company didn't notify him. "FileNet tends to play with the big boys," he says. "We always felt they weren't really interested in us." A FileNet spokesman confirms that the Acenza product was phased out but claims the company informed all customers.

Even happy customers note that FileNet's older software can be tough to upgrade. The Los Angeles County Employee Retirement Association (LACERA) has used FileNet's Visual Workflow software since 1997 to automate about a dozen processes related to handling member inquiries, such as estimating retirement benefits.

The company is now contemplating upgrading to FileNet's newer Business Process Manager—but the move will be cumbersome, says Robert Whitten, LACERA's chief technology officer. "It's almost like a brand-new product," he says. "All the things we customized with the previous product will have to be changed." FileNet acknowledges that migrating from its older workflow software is "challenging" but says the more recent eProcess is much easier to upgrade.

Still, says Whitten, "FileNet has proved to be a reliable partner, so we'd be reluctant to bail."

Business Process Management Filenet
3565 Harbor Blvd.,
Costa Mesa, CA 92626
(714) 327-3400
www.filenet.com
Ticker: FILE (NASDAQ)
Employees: 1,720

Lee Roberts
Chairman, CEO
Before joining the company in 1997, he spent 20 years at IBM in various sales, marketing, product management and general management roles.

Ron Ercanbrack
President
Also joined FileNet in 1997, after working 19 years at IBM in various sales positions.

Products
Business Process Manager (previously called eProcess) software provides process design, simulation, tracking and analysis. Forms Manager (previously called eForms) lets customers design, deploy and process electronic forms that are Web-based or in a proprietary format. P8 is Windows-based server software that underlies the latest versions of FileNet's newest products.

Reference Checks

LACERA
Robert Whitten
CTO
rwhitten@lacera.com
Project: Provider of retirement and disability benefits to 80,000 active and 42,000 retired L.A. county employees has used FileNet's workflow software since 1997.

Park University
Sara Freeman
CIO
sara.freeman@ark.edu
Project: Parkville, Mo.-based university with 22,617 students initially deployed eForms to process student applications and manage the enrollment process.

Occidental Petroleum
George Otott
Mgr., Corporate Systems
(310) 208-8800
Project: Oil and gas producer uses eProcess workflow software to route 65,000 invoices per month through a chain of approval, based on factors such as dollar amount.

Toyota Financial Services Canada
Larry Baldesarra
Senior VP
(905) 513-5405
Project: Car financing group in Ontario, Canada, allows 261 dealers to submit loan and lease applications electronically with eForms.

AAA Missouri
Bob Schreiber
VP, Insurance
(314) 523-7350
Project: Regional auto association in St. Louis uses the discontinued Acenza workflow product to help 500 agents process insurance claims.

Wescom Credit Union
Mary Sagerman
Mgr., Workflow Systems
msagerman@wescom.org
Project: Credit union in Pasadena, Calif., processes between 100 and 150 weekly customer surveys with eProcess, which routes those needing immediate attention to the appropriate staff.

Executives listed here are all users of FileNet's products. Their willingness to talk has been confirmed by Baseline.

Filenet operating results*

2004YTD20032002
Revenue$193.58M$364.51M$347.02M
Gross margin74.8%72.9%69.6%
Operating income$5.52M$11.08M$5.54M
Net income$6.16M$10.92M$8.27M
Net margin3.2%3.0%2.4%
Earnings per share$0.15$0.29$0.23
R&D expenditure$39.81M$77.05M$71.74M

* Fiscal year ends Dec. 31; YTD reflects first six months
Source: company reports

Other Financials** Total assets - $434.09M
Stockholders' equity - $313.41M
Cash and equivalents‡ - $281.96M
Long-term debt - None
Shares outstanding - 41.10M
Market value, 11/1 - $1.09B
** As of June 30, 2004, except as noted
‡ Includes short-term investments



 
 
 
 
 
 
 
 
 
 

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