With its acquisition of Gelco Expense Management complete, expense reporting supplier Concur will roll out tools integrating the two companies' product capabilities in the coming months and plans soon to announce further innovations to come this year.
Redmond, Wash.-based Concur in July announced the agreement to acquire Eden Prairie, Minn.-based Gelco, with about 625,000 on-demand users, for $160 million
(BTN, Aug. 13, 2007) which it completed in October. Since then, the focus has been on back-office consolidation and acclimating Gelco clients to the new ownership, Concur CEO Steve Singh said.
"We have completely integrated the sales organization, support team and research and development," Singh said. "We couldn't have asked for a better cultural fit. People on the Gelco team have been able to meld into Concur, and both sides are very pleasantly surprised."
Concur also is ahead of schedule in integrating Gelco's CardLink capabilities, a reimbursement control system that ties together corporate card and expense reporting data, into Concur's platform, Singh said. The original plan was to complete the integration by September, but the company now is on track to do so by March, he said. Concur also has reported intentions of integrating Gelco's auditing services.
Although some analysts have raised concerns about pricing with one major expense management competitor effectively off the market this year, John Van Decker, a research vice president with Gartner Consulting, said in a note following the acquisition that the pricing effect would be minimal. "This deal continues the rapid consolidation of the travel expense management market," he said. "While this consolidation could possibly result in higher prices for on-demand services, we believe the presence of enterprise resource planning and paper-based solutions will continue to stabilize prices overall."
Van Decker also advised Concur and Gelco clients to "stay the course" and for Gelco clients to consider a software replacement with Concur when available. A handful of Gelco customers already have decided to switch to the Concur platform, Singh said. At Gelco's user conference in October, Concur assured Gelco customers—particularly those who only recently adopted the platform and have yet to see a return on their investment—that Concur would continue to support the Gelco platform for several years.
When Concur acquired expense management supplier Captura Inc.
(BTNonline, Aug. 1, 2002), it allowed Captura customers five years to migrate onto the Concur platform. The vast majority, however, did so in the first two years, Singh said, and Concur hopes that Gelco clients similarly migrate.
So far, many Gelco customers have been receptive to a switch, Singh said. Concur demonstrated its platform to Gelco users at their conference, and about 300 Gelco users also showed up to Concur's user conference in November, he said.
Singh said the integrated online booking and expense capabilities, created following Concur's acquisition of Outtask
(BTN, Feb. 6, 2006), and further movement toward true end-to-end T&E reporting is the continued focus and draw for clients. So far, Concur and Paris-based technology firms KDS are the only players in the expense reporting field to release single-company consolidated booking and expense tools.
"The technology industry in general has failed, so it's about time we got it right," Singh said. "We're innovation-starved, so we have the opportunity to drive the innovation curve for the next couple of quarters. Customers benefit when suppliers are driving innovation, because it forces them to be accountable to the customer."
Business Travel News' Fourth Annual Expense Managers' Survey indicated that while a small percentage of companies have integrated online booking and expense tools, about two-thirds said they prefer a single supplier for both
(BTN, Oct. 22, 2007). Still, Concur's major competitors, including CyberShift's Necho and Databasics, are sticking to a flexible consolidation route, forging alliances with online booking suppliers and other elements of the supply chain, with claims that expense managers prefer to have a choice in putting together the components of their expense management process.