BMC plans a 'simple' attack on the mid-market

BMC plans a "simple" attack on the mid-market

news analysis BMC Software is hoping that greater enthusiasm for process automation and ITIL will help it expand into mid-market businesses, but some analysts are questioning whether it can easily make the conversion even as the company weighs the pros and cons of open source for its business future.

At its recent user conference in Prague, BMC announced a series of updates to its business service management (BSM) products, which help businesses define dependencies between different IT applications and automate the management and provisioning of services.

"We are a long way from IT being a truly automated department," CEO Bob Beauchamp said in an exclusive interview. "It is still far too manual and far too reactive."

"We're on a long term simplification strategy to make our products faster time to value and easier to install," he said. "That naturally brings you down market."

In a recent analysis, Forrester Research vice president Thomas Mendel questioned whether BMC could successfully transition its products from large enterprises to medium-sized firms.

"BMC Software has tentatively reached into this market, but it is still using a derivative of the solutions aimed at larger enterprises," he wrote.

Beauchamp rejected that analysis. "We have 15,000 customers in 116 countries, so by definition we are fairly significant in the mid-market," he said.

A challenge for BMC and its rivals -- which include CA, HP's recently acquired Mercury division and IBM's Tivoli products -- was making the implementation of those products easier, Mendel said. "None of these are plug and play."

Beauchamp said further product releases would offer "significant improvements" in implementation, but said that technology could only go so far.

"The bigger problem for most organisations is process redesign," he said. "Automating a bad process just makes you do things poorly faster."

Beauchamp was also ambivalent when questioned about the potential for open-source products in improving service management technology.

"I'd say right now the jury's still out on how much impact open source will have directly in our space," he said. "We are not today seeing many of our large customers tell us that they intend to go open source for some of their management components."

"On the other hand, I think it's possible that certain layers of the stack could be commoditised over time, and we're looking at whether or not we want to lead that charge or watch it as it occurs."

The recent release of version 3 of ITIL (IT Infrastructure Library), which provides best-practice guidelines for service delivery, should stimulate interest in the sector, Beauchamp predicted.

"I'd say very few mid- to large IT organisations are unaware of ITIL now," he said.

"Just a few years ago, particularly in the US and some parts of Asia, they would have been ignorant. Now it's pervasive."

However, a recent survey of Australian mid-market IT managers by Brennan found that 60 per cent had never heard of ITIL, underlining the challenge vendors in the sector face.

Angus Kidman travelled to Prague as a guest of BMC.

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