IBM recently announced its acquisition of Salesforce Platinum Consulting partner, Waeg. The company, whose name means “wave” in old English, expands IBM’s Salesforce service presence in Europe and is IBM GBS’ second Salesforce services acquisition in 2021, following 7Summits in the U.S. It is also GBS’ fifth acquisition since IBM announced the intended spin-off of its managed infrastructure services business last October, highlighting how IBM Services is shifting its portfolio to digital offerings.

Waeg has, we estimate, around 160 employees. It has two primary strengths: specialized skills and its delivery network.

The company has a background in strategy consulting, business process re-engineering, and B2B Commerce Cloud (the former CloudCraze products, acquired by  Salesforce in 2018). Over time, Waeg expanded its B2B Commerce niche to B2B marketing automation (the Pardot products), Service Cloud, and ERP/back-office integration. The company has been investing in its MuleSoft capabilities, following the API-based product integration strategy of Salesforce. Waeg highlights that it has developed connectors for B2B Commerce with product management systems, such as handling promotions and coupons and logistics firms’ systems, to shipment tracking.

A particularly distinctive aspect of Waeg is its delivery network, which comprises a small local consulting presence combined with nearshore delivery centers within the EU. While the U.S. and the U.K. have adopted global delivery for traditional IT services and digital services, Continental European firms have preferred a more onshore approach, especially for digital projects such as Salesforce.

Waeg brings in a delivery organization that is primarily based in Warsaw, Lisbon, and Dublin. Meanwhile, Waeg continues to deploy its sales office network onshore in Amsterdam, Brussels, Copenhagen, Lyon, and Paris. Waeg is also building some onshore project management and business analyst presence to interface with clients with the same culture and language.

Waeg highlights that the pandemic and the adoption of WfH have deeply influenced European firms. Client demand for B2B Commerce Cloud has accelerated, while at the same time, the appetite for Service Cloud has remained very solid. Indeed, Salesforce’s earnings over the last year have shown high client traction for Commerce and Marketing Cloud along with a more traditional product such as Service Cloud (used in contact centers).

And, with WfH adoption, Waeg sees that nearshore delivery for digital projects, still in the EU, is now more acceptable to Continental European organizations for data privacy reasons. As such, Waeg provides IBM GBS with a foundation for scaling its Salesforce delivery presence rapidly.

We believe that Waeg will help IBM target new Salesforce opportunities in the manufacturing and life sciences sectors in Europe. The company brings a client base in manufacturing and CPG, OTC distribution, and animal health products. Significant clients include Novartis, Baxter, MSD, Biomérieux, Moet Hennessy, Friesland Campina, Barry Callebaut, and Dawn Foods.

Waeg is also expanding its Salesforce capabilities to supplier relationship management, where it sees significant client interest in the wake of COVID-19 and interest in sourcing locally and identifying new suppliers.

With Waeg, IBM GBS is expanding from its  Salesforce strength in the U.S. and now has a decent presence in growth markets in Europe. APAC will be IBM GBS’ next priority, though there may be further inorganic growth in key European markets.

As well as geographic expansion, IBM will further expand its portfolio specializations: field services, quote-to-cash, and Vlocity/Salesforce Industries are likely candidates. Given Salesforce’s growth and aggressive acquisition strategy, IBM GBS has plenty of options for further development.