Pilgrim Baxter & Associates is outsourcing the maintenance and management of its Web site (PBHGFunds.com) to Wayne, NJ-based Cutler Systems Management, a provider of Internet application management services. Cutler has already taken the reigns, administering the third quarter report updates to the site, and will help Pilgrim Baxter add multimedia functionality in the near future.
Brian Bereznak, manager of e-commerce for Pilgrim Baxter, explains that the firm decided to outsource the management of its site so that it could focus its internal IT resources on applications and functionality that would serve to distinguish it from competitors. "Web site maintenance is a resource-intensive area, and under this model, it allows Pilgrim Baxter to use its resources to focus on our core competencies, like developing our online strategy," Bereznak says. He suggests that maintaining a site will not distinguish the firm from competitors, and internal IT resources would be better spent on focusing on the future evolution of the site.
Cutler is primarily responsible for cyclical upgrades to the site that are made on a quarterly basis. According to Bob Petrie, chief operating officer of Cutler, the vendor will also aid in the development and addition of multimedia applications onto the site, including audio feeds from fund managers and possibly video. Cutler, which usually enters a Web project in post-production, is platform independant and will accommodate any technologies already specified by the original developer. Pilgrim Baxter will continue to utilize New York-based Agency.com for most of its future Web development.
"This is an example of the developer disengaging concurrent with us engaging with the customers," explains Brian Galle, Cutler's CEO. Although Cutler is one of the few vendors dedicated exclusively to site maintenance, Galle expects - or hopes - this to become more of a trend as companies with Web sites and third-party developers come to realize that site maintenance is not a routine that can be overlooked.
Petrie adds, "we're finding that clients have focused on what it takes to get an application up and running, but they then underestimate what it takes to manage that. Until now, clients have been trying to leverage the developers, but a lot of times, the developers don't want to focus on that type of business, and that's why we exist."
Pointing to the regular quarterly revisions that must be made to the Pilgrim Baxter site - which includes updating analyst reports and fund data - Galle says, "that schedule is not consistent with a Web developer which wants to work more on a project by project basis." He adds that there is a growing need for a firm like Pilgrim Baxter to identify who will respond to problems like system outages at 3:00 a.m.
Pilgrim Baxter has signed a one-year contract with Cutler for about $10,000 a month, that includes all services that were jointly agreed upon by the firms, but the price could rise if "customer needs exceed initial expectations," says Galle.
PBHGFunds.com currently allows clients account access and the ability to transfer monies between the firm's 16 mutual funds. Pilgrim Baxter manages approximately $6.3 billion in assets.