An accounting scandal, near-ruinous acquisitions, and a bankruptcy filing would kill off most companies. Fortunately, Peregrine, a market leader in enterprise technology solutions for asset and service management, isn’t most companies. Instead, it regained its footing by shedding non-core business units and product lines, paring back resources to bare bones, and shoring up lagging investments in its existing customer base.

“The way we characterize the company now is that we regained substantial momentum in the marketplace,” said Jim Zierick, senior vice president for marketing and strategy at Peregrine. “We shrunk to survive in bankruptcy, and we’re now growing again.”

Indications of the rebound include Peregrine’s license revenues, which grew about 49% in the first quarter of fiscal 2005, and total revenues, which rose 7% when compared to the same quarter last year.

Zierick points to another key industry metric, the maintenance renewal rate, which tracks the percentage of customers Peregrine has kept. It’s continued to increase, and Peregrine’s goal is to get it in the 90-plus range, putting it in the top performance quartile for software companies.

Zierick expects to get there with innovations like Optimal IT, which Peregrine is rolling out for its product and solutions line. But a renewed commitment to what made it successful in the first place is the hallmark of Peregrine’s revamped business model.

The pre-bankruptcy Peregrine had lost its direction and focus, not knowing how to sell its products or who to sell to, said Zierick. “We clarified that, focusing on large enterprises, knowing that people with the most complicated IT problems are the ones who get the most benefit from us.”

The company also realized its asset and service management nucleus had untapped potential. “We recognized these were now strategy topics for CIOs and would have growth rates above the industry average,” said Zierick. “We believe we can grow the company by showing clients how to get full value out of Peregrine products and getting the majority of our customers to buy our entire product range.”

Global branding
Peregrine’s 2005 plan is multifaceted, with a new global brand campaign, strategic initiatives, and go-to-market components—all of them closely interwoven.

John Mutch, president and CEO, came on board the same month Peregrine emerged from bankruptcy and made the decision to reposition the brand. “We heard from customers that they want us to be more of a solutions provider—not just providing a product but showing them the business value it can deliver,” said Zierick.

What emerged was the company’s Evolve Wisely branding, with an emphasis on the best ways for Peregrine to help customers improve IT performance. “The campaign captures the notion of us helping our customers manage the map of change and complexity in their IT environment,” Zierick said.

That dovetails with a strategy called the Peregrine Evolution Model, which Peregrine uses to help customers through the stages that normally accompany improvements in asset and service management processes. The market-ready complement to this is a series of solution bundles created by Peregrine. “They are appropriate for each stage of evolution and address the key pain points our customers identified,” Zierick explained.

Analytical approach
Peregrine differentiates itself from competitors in four ways. First, its analytical approach gives customers a quantitative assessment of their operating performance through products like BI Portal, whose business analytics capability lets customers use Peregrine data to identify IT performance drivers, problems, and solutions. Peregrine touts its next-generation version of its IT Business Analytics, which is part of larger vision called Optimal IT. With Optimal IT, Peregrine will adapt analytical tools and decision modeling capabilities specifically for IT infrastructure, so existing information can be extracted from operating systems to support decision modeling and predictive analysis.

Second, rather than insisting on being a one-vendor solution to their customers, Peregrine realizes it’s not feasible for most of its large customers to get all their products from one source. “We have to make our product connect with everyone else’s and be very open from a technical integration point of view,” Zierick said.

Third, Peregrine takes advantage of its flexible, responsive product line to adapt to bleeding-edge industry trends. One such trend is ITIL, the Information Technology Infrastructure Library begun as a resource of vanguard thinking in service management processes. “We were one of the first companies to offer an ITIL-compliant product line,” Zierick said. “In fact, our entire professional services staff is certified as advanced ITIL practitioners so they can consult with our clients on the best way to implement ITIL processes in their organizations.”

Fourth, Peregrine has a leading position in automating complex processes that its customers would otherwise perform manually. “Particularly in asset management, our procurement and financial management solutions have automation capabilities for those key process tasks that go far beyond any of our competitors,” Zierick said.

Although it might seem counter-intuitive, Peregrine is betting that a coming consolidation trend in its space will favor smaller players like itself. Its three competitors have much broader product ranges. “In many cases, as CIOs look to consolidate vendors, it’s tempting for them to go to the vendors with the largest product lines,” he admitted, noting he’s nevertheless confident Peregrine can meet the challenge posed by larger providers.

“We intend to be the product feature/functionality leader and the thought leader in our space: the people you turn to if you want leading-edge thinking.”

Ray Pelosi is a Decatur, Georgia-based freelance writer and speechwriter focusing on business-to-business and public policy issues. He can be reached at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it