It's good news in general. The marketplace needs single source vendors.

We had the chance to meet with Ed Koepfler, the new CEO of Icarian, a few weeks ago. A veteran of the ERP wars, Ed was brought into Icarian to make its visionary offering more market relevant while growing the business. The plan, as it was described to us, was to fill out Icarian's functional offerings so that it competed easily and naturally with other ATS vendors. The Workstream integration makes that vision possible.

The enhanced Workstream is an interesting operation. With a complex set of revenue producing candidate services, the firm is more balanced than most for the sort of economic downturn we are currently encountering. Offsets in margin, driven by a balanced blend of offerings, make for long term stock price stability.

The most interesting thing about Workstream's business model is that it makes sense as a "C" level sale in a way that other, more focused operations do not. By being able to solve sourcing and outsourcing problems, combined with the raw potential of the legendary Icarian workforce analytics, Workstream is the only vendor currently positioned to offer full service workforce optimization services that can be actually executed. In this way, they have created an extremely attractive acquisition target for Peoplesoft, SAP or Oracle.

The integration issues, from sales force to technical consolidation, are not small. Workstream will need to focus its energies on getting the story straight will delivering the "goods". Fortunately, the acquisition brings Marie Jackson onto the Workstream team. Marie is a tireless articulator of vision who has repeatedly demonstrated her ability to help her company rationalize and communicate its offerings. Assuming that the Workstream team has the necessary technical integration skills, the combination will be quite powerful.

The timing couldn't be better. With 90 days to go before the fall selling season starts in earnest, it's entirely possible that Workstream will join the top tier ATS providers in the competitions for early 2003 awards.

 -John Sumser

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