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Atlassian, AgileCraft join to scale Agile development

With its acquisition of AgileCraft, Atlassian aims to help developers work better together, but also scale their Agile practices across an entire enterprise.

The latest acquisition in the DevOps space could help enterprises extend their Agile development practices to address companywide objectives.

Atlassian, a provider of team collaboration software tools, has agreed to buy AgileCraft, a provider of enterprise Agile planning software, based in Austin, Texas. The acquisition aims to help scale Agile development practices from a team level to departments, divisions and across an entire enterprise.

AgileCraft's software enables enterprises to create a master plan of their key projects, map those projects to the required resources, and identify the cost and expected value of the work that teams perform across the company.

Atlassian's enterprise customers want to use the company's tools to support collaboration and Agile development across all teams in the enterprise, said Cameron Deatsch, vice president of product at Atlassian.

The company began some internal projects to meet those needs, but noticed some big enterprise customers, such as Anthem, AT&T, Fidelity and Nielsen, used AgileCraft alongside Jira tools to meet their scaling needs. They used Jira for all of the team collaboration tasks, but everything above that -- including enterprise planning, portfolio planning and divisional planning -- was done with AgileCraft, he said.

Cameron Deatsch, vice president of product, AtlassianCameron Deatsch

Atlassian explored a partnership with AgileCraft, but decided an acquisition was a better fit, he added.

While Atlassian tools, such as Jira, help development teams collaborate, AgileCraft's software connects these teams' work to the strategic objectives of the overall enterprise and provides visibility into their work production. AgileCraft supports Agile frameworks, including the Scaled Agile Framework (SAFe) and others.

This move strengthens Atlassian, which is good at the team and developer level, but weak at the portfolio management layer, said Thomas Murphy, an analyst at Gartner.

"[Atlassian] provides AgileCraft with a huge audience as the chosen SAFe-compliant solution that will disrupt lots of different elements of the market," Murphy said. These elements include competitors such as CollabNet VersionOne, CA's Rally and services companies, such as cPrime, that implement SAFe for Atlassian.

The $166 million deal is expected to close next month. For fiscal year 2019, Atlassian expects AgileCraft to add up to $2 million to Atlassian's revenue.

Support for competing stacks

What makes AgileCraft interesting is the platform's focus on helping enterprises figure out how to replicate DevOps success by holistically looking at and correlating the business and financial side of things and DevOps process flows.
Torsten Volkanalyst, Enterprise Management Associates

AgileCraft's value stream management technology provides joint visibility for Atlassian's own stack into Azure DevOps Server, Rally and various continuous delivery tools.

"What makes AgileCraft interesting is the platform's focus on helping enterprises figure out how to replicate DevOps success by holistically looking at and correlating the business and financial side of things and DevOps process flows," said Torsten Volk, an analyst at Enterprise Management Associates, based in Boulder, Colo.

Atlassian's addition of a DevOps analytics platform could replicate the success of one or two high-performing DevOps teams across the entire enterprise, Volk said.

"Considering the lack of competition in this arena, I think the $166 million could prove to be money well spent," he said.

A key question is whether AgileCraft customers will face pressure to move to the Atlassian stack. Most enterprises use a variety of different products at the teamwork level. AgileCraft connects to Atlassian competitors' products, such as Azure DevOps Server, but Atlassian will not interfere with those relationships and plans to maintain and improve those connectors, Deatsch said.

"We want to make sure we can connect all that work, whether they are on the Atlassian stack or not," he said.

AgileCraft not only gives Atlassian a way to bolster Agile development teams that use its various tools, such as Jira, Trello and Confluence, but it also opens up longer-tail work scenarios that Atlassian hasn't traditionally served, said Chris Marsh, an analyst at 451 Research.

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