Over on our main blog you can find details of our latest MWD Insights event, launched today – Reinventing Customer Experiences with BPM.
Anyone can access all the content – the keynote and the accompanying (and really cool, IMHO) series of case study interviews – for FREE. All you need to do is ensure you’ve signed up for our Guest Pass registration.
Please visit the event – and I hope you enjoy it! It’d be great to get your feedback.
In the past week I’ve spoken to BPM technology customers of both TIBCO and Oracle about their current work and future plans. Both customers have expressed concern about the degree to which their existing BPM investments will be protected in future.
TIBCO has recently announced a heavily reengineered BPM technology offering, ActiveMatrix BPM; Oracle has been through a similar exercise in bringing Oracle BPM Suite 11g to market. Both products are significantly different from what came before in a number of ways. In Oracle’s case, I’ve already had the opportunity to look at the new offering in-depth, and I’m really impressed (here’s our detailed report). I’m hoping to be able to take a similarly deep look at AMX BPM in the next few days, but on early information I’d say the new TIBCO offering looks really promising.
Nevertheless it’s not necessarily the case that TIBCO and Oracle customers are punching the air with excitement about the new stuff. Both companies I spoke to have made very significant investments in earlier versions of these technologies and now see their investments as important to protect. Their investments haven’t only been in software licenses but also in skills – and protecting these sunk investments is at least as important for them as finding out what the new stuff can do.
In both cases there are question marks about how easy it will be to migrate existing investments from the ‘old’ platform to the new offering. Of course all enterprise software vendors say they’ll support previous versions of tools for existing customers, but there’s a difference between continuing to fix bugs and actually helping a customer protect the value of an existing investment into the future.
Now of course BPM technology is hardly unique in this; the issue of how to bring customers forward to new product releases, particularly when those new releases represent big changes over previous releases, has long been a thorny one for every enterprise software vendor.
In my experience, though, something that really helps minimise the risks of these kinds of product direction issues is regular and extensive communication with existing customers about the potential impact on them, and a willingness to listen to and deal with their concerns.
As I said, this is hardly unique with BPM; but seeing as successful BPM implementation typically involves excellent management of organisational change, you might think BPM vendors would be well-equipped to make these Product Management processes really sing.
What do you think?
I read a smart piece by Nimbus’ Ian Gotts the other day (”Putting the M back into BPM” [PDF at BPtrends.com]) and it made me think.
You see, the argument about whether “BPM means automation” often seems to be framed as a binary choice: either processes are automated, or they aren’t. I don’t think this is very helpful.
In practice, I can see automation through software playing a role in (at least) four ways in the context of BPM initiatives. I think it’s really important to be clear about how these levels of automation contribute in different ways to improving how work gets done in an organisation:
Four aspects of automation in BPM
It might seem like this is a bit of an academic way of looking at things, but it becomes particularly useful as a frame of reference, I think, in the context of discussions that are currently swirling around concepts like Advanced Case Management, Dynamic BPM, etc etc. I’ve seen a lot of debate about whether the scenarios described as being relevant in ‘Advanced Case Management’ can be addressed by ‘BPM technology’ and the only answer I can come up with is “it depends on how you scope your definition of ‘BPM technology’”.
In my mind (and I agree with Ian Gotts here, as well as with many others) the four aspects of software automation in BPM are independent of each other.
For example you can get value from having tools that combine support for the definition of work with support for the monitoring of work, and have the actual planning and execution of work be left up to individuals (as is the case with Ian’s company’s tools). You can also get value from having tools that focus primarily on supporting work monitoring and management, while allowing actual work to be structured dynamically and collaboratively, “just in time”.
My basic premise is that BPM isn’t a technology discipline, though technology plays a crucial part in it. My view is that there are a number of ways that technology can be applied in the context of BPM, and just one approach (simplistically characterised as “an analyst creates a BPMN diagram, deploys it to a process server and then watches graphs appear on a monitoring dashboard”) isn’t enough to cut it.
I’d love to hear your thoughts!
Am I way off the mark? Is this a useful way to map how different technology offerings help with BPM? One thing I was thinking of doing was using the above diagram as a “map” against which I’d highlight the different parts of the offerings of a spectrum of BPM technology vendors…
As I mentioned in our 2009 report SAP’s BPM play,
“SAP’s BPM play both opens new process improvement territory up for SAP to work on, and also helps SAP protect its position as a supplier in the face of other vendors with BPM technology offerings who threaten to make the value of its applications more opaque to customers.”
SAP was one of the primary beneficiaries of the BPR wave of business improvement that washed over industry in the early 1990s – and indeed this is still the case today. Most organisations that report an active interest in business process improvement today cite “implementation of packaged applications” as the chief route through which they implement process improvements.
Whether BPM specialists like it or not, SAP is a big part of the business process improvement picture, particularly when looked at from a business management perspective. Nevertheless, SAP has struggled to deliver technology and assurances that match industry expectations about the current BPM wave.
A big part of the challenge for SAP has been the variety of tools it had to offer: not only its core applications portfolio but also the relatively recent NetWeaver BPM technology as well as its partnership with IDS Scheer for solution modelling, NetWeaver Process Integration… and more.
Against this backdrop, the announcement of SAP’s new BPM Starter Kit (announced a couple of weeks ago at SAPPHIRE) promised to provide resources to SAP customers to help them figure out how BPM might apply in the context of their SAP investment. In light of the confusion that exists around precisely what BPM is and what it’s good for, the material is arranged around four “use cases”:
SAP positions the use case material as “enabling customers to understand how business processes can be enriched and extended” – but the truth is that right now the introductory material looks as if it’s been written in a real hurry, and you’re not going to learn very much at all from it. However the material does provide a handy jumping-off point for some in-depth SAP-specific resources as well as outlines of relevant consulting and education services and customer case studies.
SAP clearly has more work to do here, but by publishing this material it’s at least demonstrating that it’s serious about helping customers figure out what BPM means in a SAP context. It’s a fair start.
At its TUCON customer event this week TIBCO announced a new BPM technology platform, ActiveMatrix BPM. As usual Sandy Kemsley has a detailed blow-by-blow account of the event – I won’t attempt to replicate it!
ActiveMatrix BPM is the fruit of a couple of years’ hectic behind-the-scenes engineering work by TIBCO. It builds on TIBCO’s experience with its existing iProcess Suite and aims to deliver a rich BPM suite that runs on its strategic application platform technology, ActiveMatrix (now on its 3.0 release, and itself newly rebuilt around an OSGi core). Whereas the iProcess Suite brought together new TIBCO-developed tools (based around Business Studio) with the heritage process application runtime from TIBCO’s 2004 Staffware acquisition and a clutch of third-party tools, ActiveMatrix BPM is built from the ground up as an integrated platform and toolset.
Previous enhancements to Business Studio (support for organisational modelling and business object modelling) gave some hints at the direction TIBCO has been going, but nevertheless the engineering results are impressive. Here are some of the highlights:
Although some of these features are offered by other vendors (Oracle, Appian and Software AG all spring to mind) it’s clear that after an extended hiatus, TIBCO now has an opportunity to regain its former market momentum in BPM. With ActiveMatrix BPM TIBCO is positioning itself firmly against IBM and Oracle rather than aiming to compete directly with BPM specialists like Appian, Global 360, Savvion or Pegasystems, and this probably makes sense given the tight product and technology link between BPM and SOA infrastructure in TIBCO’s technology and positioning. However unlike some other platform vendors TIBCO hasn’t yet gone down the collaborative process discovery and design route (as IBM has with BPM Blueworks and Blueprint and Software AG has with ARISalign). According to TIBCO’s head of BPM product management, “we’re just not seeing demand for social BPM in our customer base right now”. This is interesting: perhaps TIBCO’s customers have different interests than other enterprises.
Now of course the next challenge is the execution challenge. Can TIBCO’s field personnel explain and sell ActiveMatrix BPM effectively? Although the company’s European salesforce has always had success selling iProcess Suite as a “standalone” BPM proposition to customers (thanks in part to the UK heritage of Staffware), the company has found this more difficult to do in North America. Here, BPM has been more likely to be sold as an add-on to a SOA infrastructure deal. This is something that TIBCO is going to have to work on.
As I mentioned upfront, ActiveMatrix BPM is definitely TIBCO’s new strategic BPM technology platform – but isn’t the only process management platform that TIBCO has in play; and in fact, iProcess isn’t the end of the story either. TIBCO also supports two other workflow technologies: InConcert and BusinessWorks Workflow. TIBCO has committed that iProcess will continue to be maintained and supported for the foreseeable future: however it’s likely (in my opinion) that InConcert and BusinessWorks Workflow will soon be end-of-lifed.
Within a day of each other, specialist BPM technology vendors Appian and Active Endpoints earlier this week both announced continuing strong market momentum.
Appian highlighted the growth of customer orders by 58% from Q4 2009 to Q1 2010 (and this isn’t a seasonal thing with Appian; in 2008 its Q4 was its largest quarter). Active Endpoints highlighted revenue from new customers: it tripled in Q1 2010 over the same quarter in 2009 – contributing to an overall doubling in revenue against the same period a year earlier.
Although these companies can’t be directly compared – they don’t compete very much in reality – they both share something important, and that’s that they’re at the forefront of driving specialist BPM technology to new audiences. Appian is doing this in part through its hosted Appian Anywhere offering, which is arguably now the centre of gravity of the company’s development efforts; Active Endpoints is doing this by targeting regular developers – helping them build process applications more quickly and cheaply using model-driven tools than they could by hand-building custom systems.
The distinction between “old school” and “new wave” process improvement approaches (I’ve called these “high church” and “low church” before) is just continuing to get stronger. 10 years ago, the vast bulk of process improvement activity used to be driven by the “high church” crowd: lots of ceremony, burning of incense, and so on. Scientific improvement efforts driven by highly-qualified specialists are essential in situations where there’s a lot at stake (for example when you’re reengineering an auto manufacturing line: get it wrong and it’s going to cost you a lot to put it right). And don’t get me wrong: there’s definitely a place for this.
But process management thinking and tools have now well and truly broken out of this niche – focus has shifted to being more about service improvement and knowledge work – and here the scientific approach isn’t the only game in town. If you’re looking to improve a customer service process, the cost and risk of a sub-optimal change is much lower than if you’re changing a manufacturing plant layout – for one thing, you can probably make further changes to tweak things relatively straightforwardly. What’s more, many customer service processes are so poorly understood that even sub-optimal improvement – “good enough for now” change – can be hugely valuable. Particularly if you have tools at your disposal that help to involve all the stakeholders in change as it’s being mapped out – helping ensure that the good enough changes stick.
Vendors serving the old-school crowd (IDS Scheer, Lanner and more) are reinventing themselves to be relevant against this broader new-wave canvas of “good enough for now”, where speed and agility are the watchwords and scientific accuracy driven by specialists can be balanced against successful organisational change management driven by inclusivity. Companies like Appian and Active Endpoints have been able to stand on the shoulders of those that came before, and are taking these ideas to a mainstream audience.
It’s easy to get carried away with this, of course – the truth is that in Europe at least, the organisations actively taking advantage of new-wave, “low church” approaches and tools in process improvement are in the minority. Nevertheless, this number is growing daily – and I’m consistently seeing organisations get ROI in months rather than years.
What do you think – are you seeing the same split between old-school and new-wave approaches? Do you think that this is a good thing – or maybe you think that a scientific, structured approach like Six Sigma is always important to have in place? I’d love to hear from you.
A week or so I made a lightning-fast trip from London to Boston to attend Progress’ industry and financial analyst day – primarily to hear about how the company’s acquisition of Savvion might affect (positively or negatively) its “One Progress” transformation.
As I blogged about previously, Progress has – by design – long been a bit like Unilever: a more-or-less invisible brand hovering behind the scenes, managing a portfolio of niche middleware brands (Actional, Apama, Sonic, DataDirect etc). With the instalment of Rick Reidy as CEO last year, however, Progress stated publicly that all this would change – and that by transforming to bring its brands together into a coherent set of propositions based around the idea of “Operational Responsiveness” it would position itself to grow to $1 billion in revenue. As I mentioned at the time the acquisition of Savvion was made public, Savvion’s BPM technology has the potential to be the keystone that holds its new vision and mission together.
So… where is Progress now, and what can it do?
Well, as others have covered very well (Forrester’s John Rymer has a great take [UPDATE: as does Sandy Kemsley, over a number of in-depth posts]) Progress has done a decent job of weaving a story that ties Actional, Apama, Sonic and Savvion technology together underneath the idea of Operational Responsiveness. Central to the story is a new Responsive Process Management (RPM) technology suite – combining products from the aforementioned brands and providing a unified process/event/transaction monitoring and management console called the “Control Tower” (based on existing portal technology from Savvion). If products come to market as planned, Progress will be able to stack up (pun intended) well against Oracle, TIBCO and IBM in this space.
So far, so good. But there is a danger lurking here for Progress, which is that in its quest to differentiate, it’s painting itself into a corner.
The idea of RPM is to help customers optimise offers and experiences for customers at the point of interaction to drive competitiveness. It’s about helping customers “change and tune their business operations without disruption, when the conditions are right, to increase revenue, maximise profit and prevent loss” (as Rob Levy, ex CTO of BEA and now Progress’ Chief Product Officer, said at the event).
This sounds sensible, if a little in advance of where most organisations are today. What made me nervous, though, was this statement combined with comments from Dr John Bates, Progress’ CTO: “the new frontier is to drive continuous process improvement in real time… companies have done everything they can do to analyse their business statically“.
He’s perhaps right that this is a new technical frontier: but how many organisations in the real world are in a position to take advantage of it? Some, certainly (customers like Southwest Airlines, on stage at the event, would be a good example). But many organisations I speak to are still struggling to work out how to apply BPM technology and get a handle on how to go beyond process modelling. As Dr Ketabchi (former CEO of Savvion) noted: “If 90% of enterprise processes need improvement, why aren’t they being improved? People think it’s too difficult and too costly.”
It’s difficult to see how advanced, real-time business optimisation capabilities are going to be less difficult to realise than ‘vanilla’ BPM capabilities. The largest pure-play BPM technology providers have managed to build annual revenues of a couple of hundred million dollars. If Progress paints RPM as a “leap beyond BPM”, it’s hard to see how this will get them to $1 billion.
I think I know what Progress is trying to do with RPM – it’s trying to show how CEP, transaction monitoring, SOA infrastructure and BPM taken together can make the business value of each investment more compelling.
Think about it as adding probabilities: 0.2 + 0.2 + 0.2 + 0.2 = 0.8. (to use some random numbers).
The danger with the tack it’s currently taking is that it could end up multiplying those probabilities, not adding them. (0.2 x 0.2 x 0.2 x 0.2 = 0.0016).
Key to Progress succeeding in its endeavour will be its ability to lay out the RPM vision to industry in a non-threatening way – showing how customers and prospects can get from where they are to ‘RPM nirvana’ and showing how value can be added at each step on the journey.
I’m watching with interest!
A couple of days ago I listened into Pegasystems’ annual earnings analyst call to find out what the company – the largest specialist “pure play” BPM technology provider by revenue, by my reckoning – managed to make of 2009.
Off the back of 50% license revenue growth in 2008-9, the company achieved another year of 50% license revenue growth this year – with overall revenue growing 25% to $264m. This is a company on a strong growth path, and let’s not forget: Pega is not a fresh-faced VC startup growing from zero revenue. Turning 2 consecutive years of 50% license revenue growth is a pretty spectacular result for a company that’s been going for 27 years. As CEO Alan Trefler said on the call: “it’s been a remarkable year”.
I’ve long said that BPM is one of those areas of business-IT investment which is both cyclical and counter-cyclical from an economic perspective: in bad times people look to BPM to become more efficient; in good times people look to BPM to bring products to market faster, integrate acquisitions more quickly, and so on. Bearing in mind that Pega’s heartland is financial services, it’s fair to say that the company has succeeded in a pretty chaotic environment.
What’s the secret of Pega’s success? Well, of course it’s not the only company in this space doing well – most of the pure-play vendors have been turning in very healthy growth. And its technology certainly isn’t the sexiest to look at or most instantly-consumable.
But the technology is very flexible and powerful – and on top of this foundation Pega has maintained a very tight focus on building up competence, credibility, reusable functionality and referenceability in a few key process areas – many of which relate to customer interactions (sales, service and support).
Pega is definitely “going for growth” – last year it added 60 sales & marketing staff, and 60 R&D staff. This year it’s set to do the same, with particular focus on international expansion, growing partner relationships and broadening its pre-built frameworks across more process scenarios and industries.
As part of our forthcoming set of BPM offering assessment updates, I’ll be revisiting Pega’s offering in detail in the next month or so. In the meantime if you’d like to read our free Capability Summary and Overview of Pegasystems’ BPM software offering you can get it here. Advisory service clients can read the Full Capability Assessment for Pegasystems here. For more analysis of BPM trends and best practices, click here to download free Guest Pass reports, and click here for more on our premium BPM advisory service.
Yesterday I had a briefing from Paul McNamara* and John Carione of Adobe regarding the recently-announced LiveCycle Managed Services offering.
LiveCycle Managed Services is powered by Adobe’s LiveCycle ES2 BPM suite, hosted on Amazon’s EC2 platform. The company had previously introduced LiveCycle Developer Express, also hosted on Amazon’s EC2 platform.This offering provided an online subscription service aimed at developers, helping them get started with LiveCycle quickly. What’s interesting here, though, is that Adobe is positioning LiveCycle Managed Services as a production-strength platform for customers which should be considered as fully equivalent to on-premise deployment.
Adobe has wrapped the basic Amazon hosting service with a set of management services – provisioning, support, maintenance, upgrades, backup and recovery. Support is provided 24×7 by a dedicated team of NOC staff (the staff are actually part of the team that supports the recently-acquired Omniture service). In delivering the service Adobe has traded off flexibility for security, based on what it says are customer requests: it reserves Amazon computing resources as single-tenant instances, dedicated to each customer – and additionally it encypts all data before it’s written to Amazon’s S3 or EBS storage resources.
This is not a “pure Cloud Computing” offering – with utility pricing and flexible subscription – and Adobe has wisely steered clear of trying to position it as such. It’s a set of managed hosting services that Adobe is delivering on top of Amazon’s Cloud Computing platform (and just because a Cloud Computing platform is used in some part of the supply of an end service, doesn’t make the end service also a Cloud Computing service).
The pricing model is in line with what you might expect from such an offering – the model is based on an annual subscription. Customers pay for the components they use; annual pricing is set at 85% of the cost of a perpetual on-premise license for the same components. Adobe can offer customers a staging environment as well as a production environment; staging resources are priced at 50% the cost of production resources.
Adobe is pitching this as a way for customers to get started with new LiveCycle projects quickly, proving the value internally before potentially investing in on-premise infrastructure and management services to support internal deployment. However it also believes that LiveCycle Managed Services will be attractive as a continuing alternative to on-premise deployment for prospects in industries like retail, construction, mining and utilities where the geographic distribution of users and/or the lack of appetite for investment in-house IT infrastructure makes on-premise deployment difficult to sell. It’s too early to tell how strongly this new model will be taken up by customers, so we’ll be watching Adobe’s progress with interest.
*As an aside Paul is titled “Entrepreneur in Residence” at Adobe, and is responsible for Adobe’s “enterprise Cloud” business. He’s ex-CEO of innovative application-development-in-the-cloud provider Coghead, which was absorbed into SAP at the start of 2009 when its venture funding commitments fell apart.
Today Salesforce.com formally announced the availability of a new element of the Force.com platform – Visual Process Manager.Visual Process Manager is a toolset and platform for modelling and executing workflows that’s integrated into the Force.com platform. It’s based on technology acquired from call-centre automation specialist Informavores in 2009. Prior to this, Salesforce.com only had a *very* limited workflow capability on-board.
There are four main pieces to this newest element of the Force.com platform:
Although Salesforce.com pitches Visual Process Manager as something that will “help companies rapidly automate any business process”, it’s important not to get too carried away: Visual Process Manager can’t currently be reasonably compared to the tools and platforms of best-in-class specialist BPM providers. Nevertheless, that’s not really the point.
There are plenty of specialist BPM technology providers out there forging ahead with plans to create scads of innovative new features for those customers with heavy-duty process improvement and automation requirements. The general software platform providers (IBM, Oracle, SAP, TIBCO, Software AG, Progress) are getting in on the act too, and they’re looking to extend today’s market by offering large enterprises BPM functionality alongside lots of complementary software infrastructure.
But the real untapped opportunity in the market for BPM-related technology is in addressing the needs of organisations that don’t currently express requirements for specialised BPM tools – but they do want tools that can help them work smarter. They’re more likely to be attracted to low-cost, lightweight process improvement tools that can easily fit into their existing environments without requiring big commitments or culture shifts.
Visual Process Manager looks like being a really interesting development not because it’s an arse-kickingly advanced BPM toolset, but because:
Lastly – let’s not also forget the very likely integration of Salesforce Chatter (about which, more here) with the Visual Process Manager runtime. One of the hot developments in BPM right now is “social BPM” (see our recent free webinar) – well Salesforce has probably just side-stepped into that arena with a deft shimmy. (This is one of the areas I’ll be keen to dive into when I hear more from Salesforce in a few days).
