Process for the Enterprise » News

Brakoniecki on OpenText Q2 Call

Scott Francis — Mon, 06 Feb 2012 16:10:27 +0000

David Brakoniecki has some good commentary on OpenText’s Q2 results on his blog. Not about the financials of the call, but about implications in the BPM market:

In their core market of electronic content management (ECM), the Opentext world is neatly divided in two: Microsoft/Sharepoint and SAP are allies and ECM Documentum and IBM Filenet are the enemies.

At least this simplifies their strategy. They know who their friends are and who their “enemies” are. Companies rally around relatively simple strategies and objectives.

Also interesting were the comments about BPM integration (two BPM suites integrating, not to mention integrating them with the rest of OpenText’s offering):

2012 will be a year of product development to bring the products together and create a coordinated roadmap

The combine BPM product line will be integrated with the rest of the Opentext business in 2013

So far David’s blog has been the best way to keep up to date on OpenText’s BPM developments.

More Good Employment News

Scott Francis — Mon, 06 Feb 2012 05:32:09 +0000

It was great news when the unemployment rate dropped to 8.5% last month. But there were still enough zigs and zags in the data to make it unclear whether the trend would continue, and how real that number was.

Then the numbers came out Friday morning, as reported by the Austin-American Statesman and other outlets:

In the most impressive surge for the job market since the middle of last decade, the United States added 243,000 jobs in January, far more than economists expected. The unemployment rate dropped to 8.3 percent, the lowest in three years.

Hiring accelerated across the economy and up and down the pay scale. The high-salary professional services industry added 70,000 jobs, the most in 10 months. Manufacturing added 50,000, the most in a year.

Not only did the jobs report come back nicely, but an extra 200,000 jobs were added via revisions to the 2011 statistics. The economy may not be screaming back, but it is slowly but surely improving. Most surprising was that the hiring was really across the board, across a wide range of industries (including manufacturing and construction). Let’s hope the economy continues to mend.

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Targeting iOS First in the Enterprise

Scott Francis — Fri, 03 Feb 2012 05:19:42 +0000

A new blog post from Forrester‘s Frank Gillett inadvertently illustrates why it makes sense to focus on iOS first when building mobile apps for the enterprise. Already 1 in 5 (20%) of the global workforce is using Apple products (for work)!

Have you noticed an increased presence of Apple products in public spaces and workspaces in the last few years? Turns out that 21% of information workers are using one or more Apple products for work. Almost half of enterprises (1000 employees or more) are issuing Macs to at least some employees – and they plan a 52% increase in the number of Macs they issue in 2012.

But that’s just Macs. The numbers are actually more stark for iPads and iPhones. 11% of the workforce using iPhones, 9% using iPads, and 8% using Macs. The trends are most highly supported by execs and managers – who use Apple products at twice the average rate (over 40%), and with the youngest workers, who also use Apple products at twice the rate. Great trends for Apple products in the work place. Think about that – you can reach the most influential members of business – 40% of them and growing – via Apple product-focus.

So the debate of which mobile OS to target first for your mobile app has been an interesting one. Last year (actually late 2010) Fred Wilson came down on the side of Android first. But while this might have been a good “by the numbers” recommendation, there are some subtleties that I would have argued made iOS still the place to start for most mobile apps:

iOS device owners spend more money on apps (and content in general).
iOS device owner demographics trend toward higher income brackets ( desirable demographics to sell to and advertise to )
Apple’s iPhone and iPad had healthy halos around them that made them attractive “launch” vehicles for an app. Wherever you look at ads for an institutions “mobile app” the premier imagery features a prominent iPhone. Later on these institutions started including Android phones that look… well, they look just like iPhones anyway.

Finally, regardless of which OS you target first, or even if you’re cross-platform from the beginning, you might as well release on each platform one at a time – and get the press release mileage out of it.

Articles like the Forrester article, and of course Apple’s amazing Q4 performance, are reminders that the iOS platform is still the one with cachet, with the halo.

Appian 2011 Results

Scott Francis — Fri, 27 Jan 2012 22:16:44 +0000

There aren’t quite as many independent BPM software vendors to report on these days, but I still try to keep track of their financial performance because it still seems that the overall trend is up and to the right – apparently the market still hasn’t gotten too crowded for more than one vendor to be successful. And of course I’m always looking for confirmation (or exceptions) to that trend.

Appian reported “record growth in 2011″ the other day with some key statistics:

90 new-name customers
219% YoY license order increase for Appian BPM Software
Appian Cloud represented 37% of their total license orders in 2011
Highlighted new customers include several government agencies.

The press release goes on to describe Appian’s mobile BPM offering and several industry awards they won over the course of 2011. Appian’s press release and blog certainly support the thesis that BPM still has room to grow.

But what I find interesting is the wordsmithing of what seem like otherwise healthy numbers:

“90 new-name customers” – how is a customer defined, then? As a department, subsidiary, purchasing group, or corporate entity? (the use of new-name rather than just “new customers” makes one wonder what the caveat is).
219% year-over-year license growth sounds fantastic. But then they added another word – they didn’t actually say license dollars, they said “license order increase”. An increase in orders could happen if you lowered the price to free, which isn’t nearly as interesting as a 219% year-over-year revenue increase in license dollars.
I’m surprised the 37% cloud customers is as low as it is.

My beef isn’t that the numbers are good – they’re great numbers, but part of the value of a number is the context. If Appian grew license revenue 219% why didn’t they just say so? So if they didn’t just say so, then why did they feel the need to trump up the numbers by obscuring which metric they’re really reporting? It just isn’t necessary.

This isn’t a problem unique to small private companies though. Just the other day Google reported some misleading vanity metrics about Google+. The effect of using these misleading figures though was to undermine their credibility rather than enhance it.

This odd cherry picking of metrics isn’t new however, 6 months ago Appian reported “Sales orders for the Appian BPM Suite grew 158%” – again, orders, not revenue.

Of course, as a private firm, they don’t have to report anything, but if your business is growing it is hard to resist crowing about it at least a little! But I would encourage private companies reporting metrics to use plain words in what ever language you need to get through to your audience. Finessing the terminology only undermines credibility.

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SXSW: Startup Village + Lean Startup SXSW = Value

Scott Francis — Thu, 26 Jan 2012 06:57:01 +0000

The highlight (for me) of last year’s SXSW-interactive conference was the Lean Startup SXSW – a whole day of planned content, mainly in one room (in the AT&T executive center) focused on the idea of “the lean startup”. Eric Ries and team did a phenomenal job bringing together a set of topics and speakers that you just normally wouldn’t get exposure to in a single day.

Leveraging the success of that forum, SXSW has created the Startup Village this year. The 4th floor of the Hilton will be converted to startup mecca. I thought the “Lean Startup SXSW” track might have gone away in favor of this modified (and bigger billing) approach. Apparently not so. Today SXSW.com announces that they’re bringing Lean Startup SXSW back – and some of the chief instigators are involved again – Eric Ries, Dave McClure, Steve Blank, 500 Startups, et al:

The Lean Startup SXSW will take place on Saturday, March 10th from 9:30am – 6:00pm at the Downtown Hilton (across from the Convention Center), and the most up-to-date agenda can be found here.

So, more central location, same Saturday location in the schedule (good call). The agenda already has enough speakers identified for me to plan my Saturday schedule.

Once again, good evidence of how SXSW adapts and co-opts good ideas from the outside. Congrats to the organizers, I’m looking forward to it.

ACM and Product/Market fit

Scott Francis — Fri, 20 Jan 2012 04:36:45 +0000

David Brakoniecki chimes in on ACM’s product/market fit problem, and hopefully he won’t mind me quoting liberally from his post. On the one hand, there is the rock: free or nearly free software from various providers that addresses the freelance/collaboration use case…

Freelance Web designers and developers need a tool to collaborate with clients and to manage projects. They simply can’t afford to pay much for it but there are thousands of them. Basecamp pretty much plays perfectly to this market. It’s SaaS delivery model and freemium pricing makes it easy for users to get started quickly.

On the other side is the hard place: difficult integrations that must be completed before something like ACM or BPM can be successfully implemented…

If your target market is hospitals or insurance companies then just setting up the integrations and data migration is a massive upfront investment. The promised business agility depends on getting the set-up right and the compelling difference with other case management and BPM technologies is less.

And in this latter market, you find yourself up against established technology companies with robust BPM and separately, robust integration offerings (often well-integrated into a single suite).

This doesn’t shoot holes in the “methodology” side of the ACM pitch, but it sure points out a problem for the technology side of the house. And there is some market evidence to support this view. A few of the “ACM” vendors have run into the reefs – e.g. ActionBase (which I still think had the best articulation of a product that reflects ACM values, and yet was clearly not a BPMS).

BPM Lives On

Scott Francis — Mon, 16 Jan 2012 17:52:16 +0000

After all the mergers and acquisitions in the BPM space over the last 2+ years, you could hardly blame people for thinking the BPM space was going to be dead or at least lacking innovation.

However, some of us argued that innovation would continue – both within the independents that were left standing, and even somewhat among the biggest players. We have some evidence of that today with BonitaSoft’s press release – 350% growth year over year with their open source BPM platform.

First, the positives:

This is a great achievement for BonitaSoft
It shows that there is a wider, deeper demand for BPM software than what the big commercial software packages are addressing. This also indicates there is likely an umbrella underneath current commercial software pricing where a lot of the demand is dormant.
An open source package can get real adoption (200 customers+).
Innovation and market shifts continue in the BPM market

Now, for the questions (the answers to which might make these positives or negatives):

Where does the revenue come from? The site mentions subscriptions and I assume one can get pricing but prices aren’t on the website (note: BonitaSoft manifesto includes “transparency” as a core value :)
Is it all open source or just some of it? One thing I note is that BonitaSoft, while flying the open source flag, says in its overview: “Bonitasoft is already developing additional versions of Bonita with professional grade technical support and advanced features to facilitate collaborative work and to industrialize Bonita deployments. BonitaSoft reserves the right to give access to these versions on a subscription basis to its customers only.” That sounds like closed-source on top of open source to me. The fact that it is subscription based is a minor tweak to the traditional commercial model. There’s nothing wrong with this, per se, it just means that these subscription packages don’t benefit from being open source in the same way that a truly open source project might.
350% year-over-year… starting from what number? $1? $1000? $1MM? Without context it is really hard to put this great performance in context. According to one source, revenues were under $10MM as of June 2011.

Regardless of the answers, 350% is a great number to put up, the answers just put color around it. It is great to see the BPM space still producing growth numbers that surprise. Looking forward to more updates from BonitaSoft in 2012!

In Case there were any Doubts about Austin’s Economy

Scott Francis — Thu, 12 Jan 2012 15:49:57 +0000

A series of articles to kick off the new year show that Austin is a bright spot still…

Just today, OtherInbox announced it is selling to ReturnPath for an undisclosed amount. Based on the smiles from the OtherInbox team, this was a good sale, at a good time, for the team. Looks like a great fit with the parent company. It marks another success for Joshua Baer, who (along with a few others) has really re-energized the startup scene in Austin. Interestingly, part of the value ReturnPath perceived in the deal was getting a good footprint in Austin, TX:

“The decision to acquire OtherInbox was based on its technology and its broad customer base, but separately we’ve been talking about where we might expand operations, and Austin was on that list,” Forman said. “The cost of living, the tech scene and the talent pool were very attractive to us. The opportunity to get that as part of the bargain with OtherInbox is awesome.”

Socialware just landed an investment from the CrunchFund. I’ve known Chad Bockius since ’99 and I’m impressed at how he’s been able to get visibility for the company with investors outside of Austin (note that Austin Ventures is also an investor in the company, however).
The Austin office rental market is tightening up. This trend has been going on for some time. Locally, in our office building, this is noticed as I have to drive one extra floor up in the parking garage to get parking these days. There just isn’t any vacancy. Prices are moving more gradually but they are starting to move. I saw a lot of growing firms in Austin reach for bigger space in 2011, with designs on growing headcount, and a belief in the stability of their businesses.
There are IPOs on tap for Austin as well. Bazaarvoice is the most likely candidate with a strong growth track record and a strong product offering. Chuy’s, a Tex-Mex restaurant chain based in Austin is also planning to go public to fuel expansion (if a location comes your way, two recommendations: DO order the “macho burrito”, and DO order the tres leches for dessert – but find a friend to share it with). 3 other companies are up to bat this year, having already filed for an IPO.
All of this really has me looking forward to the Angelou Economic Forecast. I took a look back at my notes from last year, and it looks like he pretty well nailed the economic forecast for Austin and Texas. Not only does AngelouEconomics provide some of the best economic development consulting, it is also a local Austin startup-made-good story itself. Quite a local success story.

Here’s to 2012!

I Guess I’m not the Only One

Scott Francis — Wed, 11 Jan 2012 15:05:19 +0000

I guess I’m not the only one who thinks Google is making too many enemies at once. John Gruber of Daring Fireball, riffing off of an MG Siegler post on the Serach+ announcement:

It also occurs to me that there’s no company in tech with as many enemies as Google. Apple, Amazon, Microsoft, Facebook, Twitter — Google has taken the fight to all of them. In this sense they’re like Microsoft 15 years ago.

This just doesn’t seem smart. I like Google, and I like the services I use from Google. But they’re running the risk of alienating people who otherwise would like them – a lot. Not to mention, they’re creating competitive risks where there might not have been any before.

I sense there will be a lot of damage as things settle out, but I expect Google will continue to reap huge profits from Search, regardless.

Brakoniecki on OpenText Competition

Scott Francis — Tue, 10 Jan 2012 06:16:57 +0000

I liked Dave Brakoniecki’s analysis of OpenText’s December comments on their BPM strategy. Like Dave, I find it interesting that they think they’ll be most often running into Pega and IBM. Dave’s thoughts:

OpenText probably need to acquire some rules technology to really compete with Pega and IBM. Shame that Progress snapped up Corticon a few days ago.

His analysis is spot-on in that without a rules engine, OpenText has a chink in the armor that the other vendors can exploit. And they’re not exactly a pure play vendor that can appeal to the “best-of-breed” argument with their customers. It just looks like a tough hill to climb.

Rules engines aren’t that complicated, per se. It is thinking through the design of user interface and maintenance of these rule systems that is where the value is, and where the challenges are. Incorporating them with a BPM suite is another interesting problem to solve, though one option is obviously to leave them loosely coupled. I think OpenText has their work cut out for them to differentiate themselves in this market, but we’ll certainly have a chance to see how it develops.