Calgary-based firm holds its own in competitive times

By Tom Keyser
Business Edge

Sure, David slew Goliath.

But how many international software vendors have slugged it out with heavyweight competitors such as IBM Corp., Computer Associates International Inc. and Serena Software Inc. and lived to tell the tale?

ISPW BenchMark Technologies, a Calgary-based featherweight with a stout heart and broad shoulders, has more than held its own in toe-to-toe sales combat against such behemoths.

Within the last few years, this modest but fascinating private company has beaten the Big Boys to major scores with such customers as ABN Amrobank of Amsterdam, one of the world’s 10 largest banks; the California Franchise Tax Board, an agency that collects more than $48.6 billion a year in state tax revenue; and Southern California Edison, a utility with more than 4.2 million customers. If you believe these were fair fights, think again.

With only 18 staff members (each a company shareholder), ISPW BenchMark generates less than $10 million in annual sales. By contrast, IBM reported second-quarter revenue of $21.6 billion U.S. last week. Computer Associates generates sales of $3 billion U.S. a year.

Serena Software? This 23-year-old California company is a relative midget, boasting “only” $95 million U.S. in yearly revenue.

“Those three are our main competition. We’re up against them every time we make a sale,” said 53-year-old Christina McGill, founder and majority shareholder of ISPW BenchMark.

“When we beat them – and believe me, it’s difficult – it’s generally because the customer’s technical staff have made the final decision,” she said.

And when ISPW BenchMark blows a sale?

“It’s often for political reasons,” McGill explained during an interview in her office, situated in a dignified and tree-shrouded older home near Mount Royal Village.

“(Customers) say: ‘Who are these folks from Calgary?’ We keep a very low profile.”

Though the company is 15 years old, its roster of international customers is exclusive indeed. And because the price of ISPW is so hefty (licensing fees range from $100,000 US to as high as $1.5 million), it can take up to five years to close a single sale.

For years, McGill and her partners relied on favorable word of mouth. ISPW BenchMark actually operated without a software sales division until 2001.

And McGill personally developed the product that evolved into such a reliable meal ticket. Known as the Integrated Software Processing Workframe (ISPW), she describes it as a sophisticated management system able to integrate a variety of applications.

“Typically, in a large organization you’ll have project teams working on different business systems, such as online banking systems, accounts payable systems, etc.,” she said. “This software allows these programmers to work together, to manage their work.”

Impressed by her initiative, the prestigious Calgary-based Ernest C. Manning Foundation nominated McGill for a 1992 Innovation Award.

A born techie who studied math and computer science at the University of Saskatchewan, McGill wrote the original program on behalf of a major Canadian energy company, which lost a significant percentage of its technical staff after moving head office from Toronto to Calgary.

“A smart manager in my department said: ‘You know, all the knowledge we had about our applications, how we run our business, walked out the door in the heads of those people (who wouldn’t move west),’ ” McGill recalled.

“He said: ‘What we need is software that manages our other software – so the knowledge stays with the company, not in the heads of our programmers.’ ”

McGill soon got down to work on what she still regards as her all-time dream assignment. She ultimately developed ISPW from scratch, at a cost to the company of about $1 million.

(For years after founding ISPW BenchMark, McGill and her small team were required to pay annual royalties for the use of the software she brought into the world.) And today, McGill credits her creative pricing philosophies, as well as a unique marketing attack, for ISPW BenchMark’s consistently strong performance.

Since each of its customers runs massive, IBM-based mainframes, McGill & Co. allow prospective clients to take an extensive – and free – trial run on ISPW’s own system.

“It’s very complicated to install a software product on a mainframe. So we allow them to log on our machine and play with the software that way,” she said. “They can test its performance, and that takes the risk out of the customer’s decision. None of the other vendors will do that,” McGill grinned.

There it is: how to become a giant-slayer in one straightforward lesson.