A Bright Light in High Tech
Nice to see a tech sector bucking the economy
I recently conducted two different interviews on the BPM (business process management) space. One of these was with Phil Gilbert, President of Austin-based, Lombardi Software and the other with Regev Yativ, Americas CEO of Magic Software.
Phil told me a very positive story. His firm is doing quite well even in this economy. His competitors (e.g., PegaSystems) are prospering, too.
Businesses are, despite the hype of ERP vendors, still operating a lot of silo’d applications and even when business units are working more cross-functional within their business unit, the parent company is far from integrated. At its core, business problems (not applications) cross department, organizational, technical and other boundaries. Problems and information don’t stay contained to an individual application (e.g., fixed assets accounting). As a result, the solutions to business problems are going to be cross-functional as well.
BPM, by design, tackles cross-functional problems.
But apparently, not all BPM products are alike.
Lombardi has been doing extremely well selling into the Indian application development community. As more and more North American and Western European firms move their application development and application maintenance to Indian outsourcers, these firms have increased their use of independent BPM solutions. Why independent? It’s easier for these companies to work with a toolset that is ERP or hardware independent. While I thought that ERP-BPM offerings were supposed to play nice with competitor’s products, the end-user of a BPM-built application doesn’t necessarily want to assume the toolset of an ERP vendor when they don’t have other applications from that vendor. Moreover, some end-users want to lessen their dependency/footprint with some ERP vendors and the use of an ERP-specific SOA stack or BPM toolset achieves the opposite purpose.
Phil indicated that the Indian firms are ‘locking up the Global 2000 big time’ when it comes to application development.
When I spoke with Regev, he indicated that the market is indeed good for BPM and Platform as a Service (PaaS) providers. His firm has been around a while (approx. 22 years) and has long offered a development platform.
Regev discussed how customers are voting for ‘choice’. They don’t want to be beholden to proprietary BPM or development platforms. Moreover, they want solutions that deliver finished applications fast – they don’t want to wait months to get platform components installed. They want the PaaS environment and shave weeks/months off of the development timeframe.
We also discussed how end-customers are looking to enhance their ‘ROEI’ – return on existing investments in IT applications. A nice concept that should get more airtime in more IT shops.
What I learned from these execs is that:
- the market is definitely robust - buyers want independent solutions - buyers have business needs that BPM addressses beyond GRC (governance, regulation and compliance) - marrying a BPM with the immediacy that PaaS offers could be a real value creating boon to some - regulatory changes, will an earlier sales driver for BPM, isn’t the main driver. Integration and rapid application development are more pressing business needs.
I’ve covered the BPM space sporadically over the years. I’ve seen it meld with portal technology, knowledge management concepts, development tools, etc. I’ve also seen the space incur a lot of consolidation. ERP vendors, hardware manufacturers and others have bought up a lot of the earlier players in this space. However, it looks that BPM may actually be coming into its own now.