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EXACT’S U.S. APPS ON THEIR OWN

Erik van der Meijden, ExactExact has turned its products in North America into independent businesses. The products lines - Macola, Max, JobBoss, Longview and Lohn - each have their own P&Ls and management. "We decided to have five independent businesses. Each has a managing director and they are arms length with Exact,” CEO Erik van der Meijden in last week’s webcast regarding 2012 results.

Exact is not providing any money to these organizations which must each fund their own research and development. If the units can generate more business than agreed upon, they can pump that money back into the operation. If the U.S. businesses need money in the short term, van der Meijden said there could be discussions. This seems to be tailored to support the introduction of Exact Online into the U.S. this year. It's obvious that if any of these products falter, Exact has established a structure that enables them to be sold or folded quickly. That always seemed implicit when Exact lumped them into Specialized Business in last year’s major organizational revamp and housecleaning. That housecleaning included dumping the American management and closing the central office in Massachusetts. The R&D funding is particularly telling as during the same presentation, the CEO said that in 2014 the company is increasing spending in that category for the rest of the company to 14 percent of revenue and to 15 percent in 2015 and thereafter. The money will go primarily into the Cloud Solutions unit. It was also telling that in showing the American products, van der Meijden quipped it was like "looking at a 1970's tie."
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