So the new Forrester Wave is out.  What’s that? you hadn’t heard?  If not, you haven’t talked to anyone in the analyst or BPM vendor community in the last 24 hours!

As usual, there are a raft-load of vendors declaring victory:

Appian: “Appian Still Leading the Pack”

Pega:  “Pegasystems ranked #1 as one of two BPM vendors that ‘lead the pack with the best overall combination of modeling, design and development features for business and technical roles driving process improvement’ “  (bonus, their article includes the image of the Wave graphic itself)

Metastorm: “Metastorm Recognized as a Leader in Business Process Management Suites Report…”

IBM has several congratulatory tweets about being in the leader quadrant, but I haven’t seen a press release yet.

Judging by the wave, I should be able to add links to Progress and Software AG press releases or blog posts by this time tomorrow.

Every one of these vendors will crow that the analysts have confirmed that they’re as smart as they thought they were – that they’re leaders (or even, “number 1″).

So, I’ll let you in on a little secret.  The Wave won’t tell you which BPMS makes the most sense for you.  Some of these offerings are actually so different that they rarely, if ever, compete for the same customer projects, and often corporations own more than one product because they aren’t viewed as doing the same thing.  For example, Appian’s strength in SaaS means that will compete more often for SaaS deployments – the decision “to SaaS or not to SaaS” was probably made before any vendors were called.   Metastorm’s strength in EA may play well with customers who are doing a lot of modeling, but for projects that are more focused on implementation, or who already own other EA tools, that offering won’t be as compelling as something more targeted at executing processes.  Even Pega (apparently depicted as #1 on the Wave), isn’t as often in competition for general-purpose BPM platform purchases – they tend to be in the finals for more vertical processes, where their investment in specific templates or verticals or applications can really pay off.  A friend once described Pega as more a company that sells rules- and BPM- enabled applications, rather than BPM itself (it wasn’t a criticism, my friend thought it was good strategy for the company).

Of course the meat of these things is in the written words inside the report, but it is hard to get there when there is that tasty graphic that everyone can look at.  I wonder what would happen if Forrester withheld the scoring and the graphic for a couple of weeks, and just revealed the more in-depth analysis.  Another interesting data point would be the number of times (that Forrester can determine) any two vendors were finalists in the same evaluation – which would allow for a 2×2 grid/heatmap that shows you who is competing with whom.  I was happy to see Forrester give up on separating BPM into various different flavors of BPM – that approach never really worked for me, personally.

So everyone is happy now.  But in the morning, we’ll humbly get back to work and get some processes built and deployed, and improve some processes.  Which is, after all, the whole point of BPM.

Update: as expected, a few announcements today:

Software AG announces their leadership status here.

And Progress’ blog entry can be found here.

Ben Farrell of Appian notes on their blog recently:

Dealing with varying levels of security requirements in ramping up new federal employees and contractors is a common pain. It is usually handled through manual, paper-based processes involving lots of documentation to be passed around, verified and tracked across multiple systems. This means major time and effort for the staff performing the processing, and delays in getting new hires into a productive work mode.

Other process areas common across government organizations include things like Procurement and Sourcing, Program Planning, Budgeting and Management, Grants Management, and a variety of HR processes. Not coincidentally, these are areas where Appian is seeing great success.

BPM software helps the federal government solve pervasive cost and productivity problems – and not in the “tried-and-failed” approach of commercial off-the-shelf software packages that cause as many headaches as they solve thanks to rigid coding. While attacking an area of common concern, BPM solutions are easily configurable – by business users – to the unique requirements of an individual agency.

I’m not an expert on which BPM vendors have market share in the Government space (it is hard to measure this kind of “market share”), but being based in or near DC doesn’t hurt Appian’s chances.  And as probably every BPM practitioner has noted, BPM is what the government needs – processes that don’t get lost in the paper stack on someone’s desk, processes that proactively notify participants about progress within the process, and processes that have consistent performance.  Ask anyone who has gone through the green card application process and you will get a story of broken processes – or at the very least, broken visibility (the applicants rarely have any sense how far along they are in the process).

One interesting note from Ben’s post on cloud computing:

There will be more to come on government adoption of BPM in the Cloud. For now, I’ll close with a reminder about why BPM in the government really matters: every one of us, as taxpayers and consumers of government services, benefits when government operations are conducted more efficiently and effectively.

Government adoption of cloud computing is interesting.  I think most people assume that most government functions won’t be in the cloud – but clearly some could be.

I’d been looking forward to hearing what Appian would say about their “Technical Case for Case Management”.  Part 1 was just a teaser, and Part 2 promised to get into more details.

But when I read part 2, I could just hear Keith Swenson’s dismay (or actually, share it).  Appian describes it thusly:

The first and foremost feature in a Case Management solution is “Ad-Hoc”.

While I appreciate the effort to explain how Appian addresses case management,  that is a very underwhelming start.  The use of ad-hoc activities in BPM and BPMN is well-known (and well supported by at least some of the tools that aren’t BPEL-based).

But this is *not* what Keith (and others behind the ACM movement) are talking about when they talk about case management or ACM.  While the “ad-hoc” activity may happen at any time or place or sequence, what the ACM crowd are after is that not only is the “when and where” undetermined at design time, but also the “who, what, and how” is ad-hoc – determined *at* run-time.

Hopefully we’ll see someone step up with a better explanation of the technical attributes of their case management solutions.  I shouldn’t be too hard on Appian – at least they’re trying to explain the underpinnings, and this was only part 2 – perhaps in subsequent articles they’ll have more to say – but part 2 was not encouraging to me.

There’s been a lot of gnashing of teeth about the state of BPM vendors, and the BPM segment, ever since IBM announced its acquisition of Lombardi (and followed quickly by Progress’ acquisition of Savvion).  Even before then, there was much discussion over whether BPM really was a bright spot in the enterprise software space – could it really be growing when everyone else was struggling to tread water?

And since these acquisitions, the attention has often turned to case management (or, the nom du jour, “Adaptive” Case Management), and some have argued that “BPM” as imagined by advocates of BPMN is in trouble.   Of course, as with many things, one way to measure “success” is by whether the businesses advocating a particular approach are doing well – and doing well is typically defined as increasing revenue (and/or profit).  Ironically, if such a firm makes money, critics will say this only proves that the firms are good at making money, not that the software or approach to BPM is adding value for customers.  But we have to accept that in the long run, averaged over *many* decisions, the market assesses value by assigning dollars (or euros, etc.) to the products that are perceived to add value, and starving the products that don’t add value by not making purchasing decisions.

Dennis Byron says the big enterprise software firms are well-positioned to take advantage of the BPM “explosion.”  Meanwhile the independents don’t appear to be suffering.  The latest report from MWD summarizes results from Appian and Active Endpoints, two vendors who wholeheartedly support BPMN (Appian with a SaaS model, and Active Endpoints with a BPMN-up-front and BPEL-in-the-back approach).

Key data points:

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.

Bigger firms like Pega are doing just fine as well, according to their quarterly reports.  So this is a good indicator of increasing demand for BPM software.  The increased demand for BPM skills, education, and even consulting is sure to follow.  It is an exciting time to be in the BPM market. Congratulations to these firms for having good Q1 results.

Well, after much celebration before announcing the details, we now have some (just some) facts about Appian’s 2009.

It sounds like it was a good year – as MWD reports, its license revenue was up 59% (but we don’t know from what base, much like Lombardi’s reported numbers before it was purchased), and customers doubled.  Of course, another way to phrase this is that ASP declined by 20% (if my math is right), or that revenue mix has shifted from prepay (enterprise license revenue) to either post-pay or subscription revenue.

MWD’s assessment is that international revenue will grow faster than domestic revenue.  And while this argument makes sense, having worked at more than one company Appian’s size in my career, I can attest that international revenue can be very erratic.  For a few reasons:

1. When starting from a small base, a single deal (or two deals) can dramatically affect the percentage growth internationally or in a region.  However, with so few data points, it may say next-to-nothing about going forward revenue.
2. Even off of a bigger base, international revenue has so much to do with your sales operation, and so little to do with your product.  There are other products out there.  There are big consulting shops out there. Whether you capture the money (revenue) that is being spent to solve the problems your software solves depends almost entirely on your sales and marketing operation.
3. American companies of this size rarely understand the international markets well enough, and make mistakes which cause big revenue swings up and down.  This is true because the executives usually lack field operational experience overseas, and though they may hire that experience, they may not be able to successfully evaluate those international experts and may end up throwing good money after bad.
4. I’ve seen a single sales rep bring in 30% or more of a small company’s revenue for a single year, only to bring in zero revenue the following year.  Individual sales rep performance is crucial to small enterprise software companies.

Appian may well overcome all of these pitfalls.  But revenue in both the US and Internationally is coming off of a small enough base that we should expect to see high beta for any of the smaller vendors.

The conclusions that Appian’s results really drive home:

• BPM is growing, not dying.  And growing faster than enterprise software generally. (Not just from this datapoint, but from Lombardi, IBM, Savvion, Pega reported results)
• The BPM pure plays were doing well in 2009.
• The remaining pure plays may still have legs and room to run while Lombardi and Savvion acquisitions are digested – even if those acquisitions are quite successful.

There’s been a lot of coverage of what it means for IBM to buy Lombardi.  Jaisundar proposed that this would upset the balance of power and cause more acquisitions… But perhaps the side effect he (and others) didn’t foresee was the positioning of the remaining BPM vendors (pureplay or otherwise) for the benefit of their suitors.

First we have Appian’s CEO posting here.  I don’t blame him for putting a stake in the ground that Appian is going to win, and positioning that the only two vendors left that matter are Appian and Pega.  Savvion might disagree, as would a few others, but nevermind.  He states that they’re the only ones strong enough to survive (by which, I would suppose he means financial strength, but he leaves that as an exercise for the reader’s imagination.  I don’t blame him for slagging IBM as killing innovation – in any acquisition like this, that is a very real possibility, and will determine whether this is a successful buy or not (at least, for folks who don’t work for IBM).  But methinks he doth protest too much, and may be trying to make sure that potential suitors remember that Appian still exists in case they want to get in the game by buying something.

Next, we have ActionBase, one of my favorite non-traditional BPM offerings.  In a previous post Jacob Ukelson made the argument that Sharepoint should be a better BPM tool than it is.  Now he argues that Sharepoint + Actionbase is that BPM dream team:  unstructured content + unstructured process… If that isn’t a pitch for Microsoft buying a nice Sharepoint add-on I don’t know what is.  Analysts are frothy thinking about how Microsoft or SAP might want to counter IBM’s move, and this is one option.

I’m not sure that unstructured process + unstructured data is the dream of every IT shop, but it is certainly a combination prevalent in many processes and organizations.  And of course those two offerings could work well together.

So it looks like everyone is putting on their finest Holiday Sweaters and looking to make a good impression for their potential sweethearts.  It’ll be interesting to see if there really is a wave of acquisitions or if this is it.

Its the creative destruction process of capitalism at work.  I just hope BPM doesn’t get lost in the woods in the process.

If you can’t make it to a BPM conference, Sandy gives you your best bet to keep tabs on it from afar.  According to her posts, nearly 300 attendees (customers, partners, analysts) attended, proving a point I made in a previous post, that there is a demand for conferences that are reasonably priced and a bit more tactically focused – and vendor-focused conferences are one way to achieve that focus. Look for more on that subject in this space soon…

A quick run-down of Sandy’s coverage:

• Don’t underestimate BPM, a keynote by Jim Sinur of Gartner
• Appian Corporate Update, in which Appian discloses a 150% revenue increase and 58% customer increase (I’m not sure if the latter is including or excluding their Appian Anywhere service, however).  This is significantly faster growth than Pega has reported, for example, and a good sign of the health of the BPM market.
• Appian 6 Product Update, with a focus on portal-building and being able to export all of the process as xml, so that it can be versioned in a source control system (this process sounds familiar to me from some other vendors).
• Customer Panel. Most interesting point Sandy reports is that the four customers cited all advised small projects to start – either because that’s what they did, or because they had bad experiences going with bigger projects first.

In a breakout session at Lombardi’s Driven 2006, I was paired with a gentleman from BearingPoint to discuss BPM vs. SOA in our session.  My central thesis at the time was that the value-proposition of SOA was primarily directed at IT – while the value proposition of BPM was focused on business drivers (including ROI) – and as a result, SOA projects were much more likely to be successful if driven by requirements from BPM projects.  After all, work tied to ROI is more likely to get funded and get finished than work that… isn’t.

Recently I commented on Keith Swenson’s post, and then saw this ebizQ article by Glenn Smith, of Appian: “SOA needs BPM”.  Glenn articulates a series of excellent points to support the premise that SOA really needs BPM:

BPM can succeed, albeit more expensively, without SOA, but without BPM SOA is only an internal technology initiative which does not directly address any business problem.

I couldn’t agree more – SOA is grease for the wheel, but it is not the wheel. And then Glenn describes SOA as it was initially defined: as an architecture, not a product.  Again, it is nice to hear someone else saying what we all know to be true despite millions in marketing spend by stack vendors:

SOA is an architectural style for developing distributed systems. It is not a specific technology, but can be applied to many technologies. It encourages loose coupling of components and enables flexibility. Individual services can be modified with no impact on the consumers of those services. Services support reuse, and can help preserve and extend the value stored in legacy systems by making their capabilities more widely available.

He then goes on to explain why BPM benefits from the use of SOA, and why the traditional tensions between this camp aren’t particularly problematic because the very nature of the loose coupling of a Service Oriented Architecture (SOA) allows for the teams to operate largely independently and interact through well-defined service interfaces.

Appian just announced the launch of Appian 6 (which will be released in a few weeks).  Among the benefits touted are a further refined design interface (aligned with the theme of process acceleration), which appears to offer better re-use of various components within Appian:

New BPM Application Design interface, allowing customers to quickly navigate all shared components and form these components into logical BPM Applications for simple management and quick migration between environments.  The re-usable library of components includes Processes, Rules, Groups and Roles, Reports, Content Management Structures, Documents, Portal Pages and Collaboration Areas.

From what’s described in the release, it isn’t clear how this feature set compares to other BPM offerings, but at least on paper, this functionality would bring Appian 6 up to par with best-of-breed BPM Software.  Of course, the devil is in the details, and would reveal whether their implementation of the new design environment is more or less productive than another environment (which is why we recommend customers actually try to build something and lay hands on the tools they are buying).

Next, it looks like Appian is extending the XML definition of the process to include all the artifacts defined by the design environment, rather than “just process and rules”.  This allows for versioning the XML in source control tools, and makes it easier to migrate the process definitions without losing assets.  However, I have to say that I would have expected Appian to support this well before version 6, and this is a feature that at least some other vendors have supported since circa 2003.  Still I’d rather have it than not, and hopefully it is a stepping stone to additional functionality for import/export in the future (BPMN2? XPDL 2.1? native support for a version control system?).

The new user interface approach sounds (to me) like an improvement over the old, as well as something possibly differentiating to quite a few other vendors’ offerings – including the ability for particular “process applications” to have good meaningful URLs.  This is a seemingly simple innovation but it can be *important* for adoption of BPM in an organization.

We’ll have to check out the beta and/or general availability release and see how some of these features manifest in the coming weeks, as time allows (or, perhaps someone else will do it for us and we can read their review instead!). I’m also curious what, if any, impact Appian 6 has on Appian Anywhere, their SaaS solution – is Appian Anywhere moving to Appian 6, or have they split the codebase?  Or is Appian 6 incorporating improvements introduced into Appian Anywhere?

There’s more information in a release from MWD, a pretty reliable source of information in the BPM market.  The main point of emphasis in MWD’s report is that the product release is focused on bringing together the methodology and the technology to deliver BPM applications more easily – which I think is one of the real strengths of a good BPMS.

A pretty compelling demonstration of Google’s collaborative features in this article about “Gravity”, which is essentially a mashup of the ARIS modeler and Google’s Wave.

Its a great demonstration.  The biggest surprise, I think, was that this was something built by SAP- not exactly known for pioneering things like this.  There was a lot of buzz over twitter and blogs about how cool this is and how impressive it is – and I agree the demonstration is impressive – but maybe not for the reasons people think.  It isn’t, for example, an impressive bit of software engineering.  Mashups are, technically, relatively easy to execute compared to many other software applications – which is why there are so many mashups with Google Maps, for example.   I imagine Google has similar designs for Wave – and this is actually what I find impressive…but more on that in a minute. Right at this moment, Google Wave integration won’t help much – its not even in public Beta yet, so it isn’t something most companies or users could take advantage of.

If I’m not mistaken, what we’re seeing in this demo is that some folks at SAP have added collaborative features to their modeler (ARIS), by mashing with Google Wave.  That’s a great idea, and we can see how simple/straightforward it looks to be.  I can imagine other tools – Blueprint, Signavio, Appian Anywhere, Blueworks – can easily replicate this from a technical perspective.  There are some issues – like security- that these tools would have to consider if Google was going to be the means for collaboration – but at least one of these tools already has collaboration features at least as good as those shown in this demonstration (live chat, invitations, mutual simultaneous editing) – just not using Google Wave to do it.

What impressed me was Google Wave.  If one of the ideas behind Google Wave is to make it easy to add collaboration to enterprise applications – that could really enhance the quality of work going on in many collaborative business applications and processes – and it strikes at the heart of what Microsoft Sharepoint does for organizations, without the infrastructure requirements and “administrative” requirements.  And whereas Sharepoint is difficult to integrate into your business applications, Google Wave has an opportunity to lower the barriers and steal a march.  If anything, watching this demonstration made me hope our beta for Google Wave arrives sooner than later-  can’t wait to try it.

UPDATE 10/4/2009: Well I know I’ve been submitted for “consideration” for getting a Wave account, but I haven’t received an email yet from the Wave team inviting me to join.  There are some interesting early comments from people who have gotten access, however.  In particular Oscar Berg had an interesting and thoughtful take on Google Wave.

Update 10/6/2009: I just saw this article and youtube video. The article’s premise is that SalesForce is here demonstrating the value of Google Wave.  But it also proves the limitations… Good read..

Update 10/13/2009: A few more websites/ pages are up with useful and interesting Google Wave info.  Although, I have to admit, some of it sounds pretty funny like, “11 tools for Google Wave you’ve never heard of”  – well, that would be about any 11 tools for most people, wouldn’t it?

Google Wave 101 – this is a list of shortcuts, etiquette.  Its pretty basic, and a bit premature for my taste.

ActionBase Blog (have to add that to my reader) had a good post about how the BPM community has largely ignored the impact Wave could have on end-users… however, I’d point them to this post for evidence to the contrary… as well as mentioning the needed enterprise features to make this reality for large enterprises. ActionBase takes a different approach to process,  which I think is highly complementary to the traditional structured process approach.  I’d love to see them paired up with other BPMS offerings to really complete the picture.

Tips and Tricks from Techie-buzz.com.

Update 11/8/2009: More thoughts from ActionBase about Google Wave; primarily with regard to Wave potentially being a disruptive BPMS-like force in the BPM market.  I’ll post some more thoughts on that possibility this week, but I don’t see it as likely to disrupt established BPM vendors so much as the unstructured or user-driven vendors, as well as to further fragment the market currently served by Excel, Sharepoint, and Notes.

Update 11/30/2009:  The creator of Gmail chimes in with his view on Google Wave – and his best point is that it just isn’t ubiquitous like email, and therefore is unlikely to displace it.  He also has some good suggestions about preserving linearity or compartmentalizing some of the threads inside a wave.  Read on right here.

Update 1/24/2010: Anatoly comments on Google Wave, concluding that it is useful, and listing pros and cons. The cons he points out are interesting:

• No email/RSS notification of wave changes.
• No permanent address for the wave
• No numbered lists
• The requirement to register for google wave to participate. This last one is a big barrier to adoption because it means that you can’t arbitrarily include people in your waves. If you can’t include them, then you’re not likely to use Google Wave to collaborate with them…

Please feel free to add additional google wave links in the comment section… I’ll try to keep a compilation without working too hard at it.

Looks like BPM companies are starting to crow about their growth and reveue prospects.  Savvion announced that it won every competitive deal they were in, Appian announced the best first half in their history, and Pega announced 1Q earnings of $9M, though they havent (yet) announced Q2.

However, outside of Pega, who of course is publicly traded, the results lack enough meat on the bone.  If Savvion won every competitive deal they were in, and Pega‘s license revenue was up 60%, then that statistic tells me that Savvion is missing a lot of deals (maybe north of $50M worth).  Appian quotes statistics about customer acquisition and “new orders” but leaves us wondering how that turns into revenue – ie, if orders are up 67%, does that mean that Revenue is up a similar amount?  bookings?  or did the ASP (Average Selling Price) decline?  Can’t tell.  Further muddying things is the fact that Pega doesn’t break out any of its non-BPM revenue from its BPM revenue.

I haven’t seen Q2 or 1H announcements from Lombardi or Intalio yet – but if I missed them please chime in here and help me out!

UPDATE: Pega’s Q2 results came out, and it reported 25% increase in revenue from Q2 2008 to Q2 2009.  Pega’s CEO reports that they are growing faster than “the market” though I’m not sure if he means the software market or the BPM market in particular. 25% growth is a pretty good result in the 2009 economy.

UPDATE (8/25/2009): Lombardi issued a press release on its 1H2009 results.  In the press release, Lombardi reports double-digit growth (though 10-99% is quite a range), and it also reports being profitable and adding to its cash reserves.  Lombardi goes on to tout its historic growth rate, market share gains, analyst reviews, product releases, etc.

Appian has just recently announced updated Sharepoint support on their website.  Support for wikis, and other bottom-up IT technology like Sharepoint, is likely to gain relevance in BPM deployments, in my opinion.  ActionBase takes one approach – allowing more adhoc processes to be defined in Microsoft Office documents.  It looks like Appian is enabling task lists to be treated like process steps in Sharepoint.  From Appian’s release:

Of course, many other BPM companies offer their own version of SharePoint integration, but I would like to think Appian has offered a unique spin on this integration that raises the bar for all other BPM vendors.  Appian not only allows SharePoint users to easily publish task lists and process reports in native SharePoint dashboards as webparts, but also Allows process designers to control and orchestrate all objects in SharePoint in an Appian process model.

Some of the other features discussed, such as creating a sharepoint site to support a process or process instance, are more similar to offerings from Lombardi, which also offers a Sharepoint integration.  I’m curious which BPM package offers the best Sharepoint integration capabilities, but I haven’t the time and resources to do the research on that front!  Opinions welcome in the comment section -

Coghead just closed its doors a couple days ago.  I first saw the news on techcrunch in this post:  Coghead Grinds To A Halt, Heads To The Deadpool.  And then the following day the news that SAP acquired Coghead’s IP and hired on some of their staff:  SAP Acquires Coghead’s Technology As It Looks Towards The Cloud (hopefully this means SAP will actually incorporate some of these ideas into its products).

Coghead may or may not be an example of a SaaS BPM tool.  It has typically been described as “a web-based enterprise software editor that featured an unusually intuitive interface”, and typical competitors were seen to be tools like Intuit’s Quickbase, though I imagine some others might consider Coghead a competitor.  I believe Intalio‘s BPEL engine was used under the hood at Coghead.

Part of what got my attention on this matter though, was TechCrunch reporting that Coghead received $11M in funding.  It reminded me of a previous discussion on Sandy’s Column2 blog regarding Appian’s funding round of $10M to fund the SaaS model Appian is increasingly moving to.  At the time, I felt that $10M might not be enough for a company to develop a successful SaaS solution.  Although SaaS seems like a low-cost way to get a business started, and it *is* in many respects, customers also don’t sign big up-front checks in most cases- a few of which can solve lots of funding problems: specifically cashflow problems.  Spreading that cashflow over 3 years, for example, may be sensible, but it is really a transfer of risk from customer to vendor (the increased risks: customer can cancel before paying the full amount, customer may be purchased/merged/forced into a failure to complete the transactions, vendor has to provision all equipment, vendor has to maintain a happy customer for 3 years to continue to collect the money).  On the other hand, once this model gets going, it can be very successful and sticky (see: Salesforce).

Regardless, Coghead shows that $10M may not be enough.  I think there are people in the business who could make that work, but if you are figuring SaaS out as you go, $10M can disappear all too quickly.

(PS-  I love the crunchbase widgets.  now all I need to do is find a wordpress widget/plugin that will add them auto-magically for me!)

Monday was a pretty big news day in the world of BPM.  Gartner just released a new version of its BPM Magic Quadrant for 2009.  Its been nearly 2 years since the last Magic Quadrant came out, so the interest and anticipation were a little higher than usual, and no doubt the jockeying was pretty fierce!

One of the complaints oft-voiced is the inclusion/exclusion of various vendors.  Dennis Byron contends that the language for inclusion isn’t really clear:

The companies covered are said to be “the top 22 vendors offering multiregional, cross-industry business process management suites (BPMSs) that interest Gartner clients and nonclients the most. These vendors account for most spending in the BPMS market. See (Gartner’s) Market Share: Application Infrastructure and Middleware Software, Worldwide, 2007.”

I am not sure how to parse the qualifier. Is AuraPortal one of the top 22 vendors as measured by spending-based market share? Spending may be the operative words; turn it around to revenue and I find it hard to believe that Aura is larger than Sun (nee SeeBeyond) in BPM. I also don’t see how Sun would not make the cut based on the capabilities criteria. No content maybe? That’s a little too granular for my taste.

Gartner does explain why it does not include Autonomy, Handysoft, Magic iBolt, NewGen, Vitria and a few others as well as why it dropped a few suppliers previously included in its previous BPM MQ such as Captaris and SunGard.

But I guess I give the analysts a pass on this one, as I’ve been in the BPM space for long enough to know that Gartner is already including *too many* vendors in the space, which legitimizes vendors who really aren’t in contention, rather than too few vendors.  From my time on the vendor side of the fence, most of the vendors on the quadrant were rarely involved in competitive sales cycles with the top couple of pure plays.

There are also some hidden nuggets of irony in the report, such as the note that IBM has a Smarter SOA compaign about how SOA and BPM work better together… this is a message that BPM evangelists have been expounding for years, while IBM and fellow SOA (stack) vendors argued vehemently that SOA didn’t need BPM or that BPM did not, in fact, better inform SOA efforts… (no fault of Gartner here, it is just a single bullet on a list of quick-hits on the various vendors).

I was also pleased to read the assessment that Lombardi customer references “are among the most advanced in BPM maturity. They demonstrate broad adoption of BPM across an organization that yield transformative business results.”  Process maturity is like a tree, whose seeds are planted and nurtured over a long period of time in order to yield a tree that will bear fruit (savings).  Several of us at BP3 were senior members and management of Lombardi’s professional services staff or within deployments of Lombardi’s software, and can rightly feel pride in fostering a culture of BPM adoption at a great number of Lombardi’s customers, as well as within Lombardi itself.  It is always gratifying to read that someone else recognizes the fruits of your labor (even if they don’t know of your efforts!).   Gartner also points out a few Lombardi weaknesses, around smaller deal-sizes and support for case management, and templates and frameworks.  These are weaknesses that can be addressed by working with certain independent professional services firms!

There are notes, of course, on all of the vendors, that are well worth reading.  In particular I thought the assessments of Appian and Intalio (the written part) were fairly spot-on to the feedback I’ve heard from our prospects and customers (both pros and cons).

One other thing I liked:  on the Ability to Execute axis, Gartner (appropriately) reduced the weighting of the “viability” part of the ability to execute evaluation.  I’ve always felt that that part of the quadrant received too much weight, to the benefit of very large software vendors, and to the detriment of perfectly viable, but smaller, independent vendors.  (Viable was generally synonymous with large revenues, and a bit self-reinforcing)

Appian had their first user/customer forum this week, and so far the best writeups of the sessions I’ve seen are on Sandy Kemsley’s blog.  We’ll have some thoughts to share as well, but for a session-by-session low-down, this is the place to go.

Looks like Appian has started up a new blog. Only two posts so far here, but hopefully we’ll get some better insights into their product strategy and direction going forward.

If it carries forward with interesting posts we’ll add it to our blog roll.

Like everyone else, I’m reading a lot of press about the economy, and most of it is negative. But in our little bubble of BPM, things are cooking along pretty well. Sure there are ups and downs but the trend-lines are up.

As if to underscore that, we’re starting to see the 1H2008 press releases from BPMS vendors. Lombardi’s is here (not to mention that it was well-covered by Bruce Silver’s blog, Sandy’s Blog, and the BPM in Action blog) and Savvion just released theirs here (if other vendors posted similar announcements I haven’t seen them yet). We’ve also seen some interesting investment news from Appian (a $10M investment round). Lombardi points to some impressive growth, especially regarding the license bookings (85% growth year over year). All indications are that the number could actually accelerate next year since they have seeded a much larger user base with Blueprint (their SaaS process mapping tool)- users that are likely to have positive impressions of the software and that may translate into more buys for the execution software (Teamworks).

Savvion also points out some nice gains- most profitable quarter yet (operating profit). However, in comparison to the Lombardi release it lacks a lot of detail. We don’t know how much profit grew year over year or by how much it exceeds previous profit numbers. And we don’t know how they’re doing on key metrics that might point the path toward growth (license growth, maintenance revenue renewals, consulting $, etc.). Not that either of these companies are required to disclose numbers, as they’re private firms, but the amount of disclosure from Lombardi is clearly greater so far. That speaks volumes about their confidence vis-a-vis the other pure-play vendors which are not putting out the same level of detail. And it puts pressure on the other guys to start putting up the same details. Hopefully with the Metastorm IPO filing, we’ll start getting at least two sets of more complete numbers to look at for trends.

Regardless of the shakeout in BPMS vendors, we believe the BPM segment is growing – the need for Process-oriented services is growing.  And we’re well-equipped to help customers with process-oriented solutions.  However, as an independent consulting firm, we keep our eyes open for this kind of trending data because we want to be playing good defense – we want to be where the ball is likely to go. That’s where the work will be, and that’s where we’ll make our investments. As a consultancy, we’d like to see all of these vendors grow at the kind of rates Lombardi is growing at, but we don’t have the numbers yet to know if Lombardi is typical, or the standout.  I think we have the most experienced Lombardi BPMS implementation team on the planet right now, but that’s another subject, and another post!