Some of the company's federal government work in the past year includes jobs for the Food and Drug Administration, the Patent and Trademark Office and the Department of Energy. That work came without a dedicated federal sales staff, which Documentum now is putting in place in a new Fairfax, Va., office, said Larry Warnock, vice president for corporate marketing.
"We don't see any reason why our growth in the federal market won't mirror our growth in the commercial market," Warnock said. Documentum's revenue has grown from $2.1 million in 1993 to $75.6 million in 1997.
Federal sales accounted for less than 5 percent of the company's 1997 revenue, he said.
Documentum is considered the market leader for document management software over competitors such as Filenet Corp., Costa Mesa, Calif.; Open Text Corp., Bannockburn, Ill.; and PC Docs Inc., Burlington, Mass., analysts said.
The Yankee Group, a Boston market research firm, estimates that the domestic commercial and government market is expected to surge from $860 million in 1998 to $1.1 billion by 2000.
"We see 1998 as a building year," Warnock said. Part of that process will be to forge alliances with several federal systems integrators. Finding integrators with a deep knowledge of a particular market is an important first step into that market, Warnock said.
Relationships with integrators such as Science Applications International Inc. of San Diego and Computer Sciences Corp. of El Segundo, Calif., are a key element of penetrating a vertical market and have helped Documentum on commercial pro- jects, he said.
Documentum is looking to its commercial partners that do substantial government work to help it move into the government market, he said.
"About 85 percent of our work comes through systems integrators," he said.
Documentum develops software for managing documents that are critical to a company's or organization's operations, Warnock said. For instance, its products allow work groups to share documents while they are being developed and then to publish them via the Internet, intranets or extranets.
The company has "no weaknesses," said Chris Mortenson, an analyst with Alex. Brown & Sons, Baltimore.
While the commercial world generally looks to save money or gain competitive advantage through document management, one of the government's primary motiva-tions is dealing with a shrinking work force, said Blix Jones, Documentum's federal account manager. Document management plays a key role in streamlining processes, he said.
Documentum's closer federal focus "is really right up the alley of what it is known for," said David Hilal, an analyst with Friedman, Billings Ramsey & Co. Inc., an Arlington, Va.-based investment banking firm.
The company's approach will follow the pattern it has used to pursue other vertical markets, Warnock said.
Overall, the company wants to build replicable solutions, he said. This approach has worked well in commercial markets, especially the pharmaceutical world, where Documentum provides document management software for 19 of the world's top 20 drug manufacturers, Hilal said.
While taking a vertical approach to the market is not unusual, "Documentum has the discipline to stick to it," Mortenson said.
Documentum's success in the commercial marketplace drew government agencies to the company, Hilal said.
"The federal area is not usually high on anyone's list, but Documentum was getting a lot of calls from the government," he said.