IBM and Red Hat form strategic partnership with process mining startup Celonis

(Reuters) — Celonis, a fast-growing German process mining software startup, has struck a strategic partnership with IBM to help companies make the most of the digital transformation that many are undergoing at speed.

IBM’s Global Business Services consulting arm will weave the Celonis Execution Management System into its offering, adding the ability to analyse data thrown off by processes like supply-chain management, finance or procurement to identify weaknesses and recommend fixes.

Celonis will also shift its software stack to IBM’s Red Hat OpenShift platform, which enables companies to operate in an open ‘hybrid’ setting that can include public or private cloud data centres, on-premise servers and mainframe computers.

That represents a big step for the Munich startup, which last raised funds here from investors at a valuation of $2.5 billion in 2019 and counts Coca-Cola, Siemens, Uber and Vodafone as clients.

“This is the most comprehensive and committal partnership that I’ve been part of,” said Miguel Milano, chief revenue officer and co-owner of Celonis, who joined from Salesforce a year ago.

“We took the risk because we saw the opportunity and the value to re-engineer our full stack to run on Red Hat OpenShift. That is massive,” Milano, a 28-year software industry veteran, told Reuters in an interview.

A typical large company runs more than 1,000 processes with the use of technology, often in different computing environments, creating complexity that makes it hard to bring about change.

Weaving Celonis into IBM’s consulting offering can help clients to identify where the value can be found across a range of applications, making it possible to benchmark performance, deploy artificial intelligence or trigger automation.

“Every workflow in every organization is now fair game,” said Mark Foster, senior vice president at IBM Services.

Celonis has doubled bookings and revenues over the past year, and Milano said the partnership offered an opportunity to accelerate its growth further.

“Our breakthrough from a strategic perspective was to realise that Celonis alone cannot take our platform to every company, every industry, every process,” he said, explaining the attraction of the partnership.