According to a recent Gartner report after years of double digit growth the total BPMS market declined by 1% in 2012 to £2.3Bn.
So what’s the reason for this decline? Gartner propose quite a few reasons including M&A activity in the BPM vendor market creating uncertainty and the hype surrounding other SMAC (Social, Mobile, Analytics, Cloud) technologies that has had the effect of putting the BPM baby in the corner.
While many of the reasons for the decline proposed by Gartner are valid in my opinion I think there have been two primary reasons for the decline:
BPM was late to the cloud market and remains today primarily an on-premise play. There were a variety of reasons for this delay and my own thoughts on this can be read here.
For IT leaders evaluating or executing on their cloud strategy a meeting with a BPM vendors pushing on premise deployments must raise some concerns. “Should I really be considering an on-prem BPM investment at this time when my gut instinct and my execs are telling me to focus on the cloud?”
In the long term there’s no need to panic. The BPM market is, I think, in the process of making a right hand turn. As more demand BPM and Case Management process applications emerge e.g. BPaaS and smart process applications, underpinned by a BPMS growth will re-emerge.
It’s the Economy Stupid
Many of the IT planning and funding decisions for 2012 will have been made in 2011 when the economies of both the US and Europe were still struggling to recover from the crash of 2007. The EU continues to recover extremely slowly and it’s noticeable from the Gartner report that the BPM market in Western Europe actually declined by almost 7% in 2012. The economic impact hasn’t just been felt by BPM vendors. Outside the BPM market the Business Intelligence market growth slowed considerably from the approximately 17 percent rate experienced in 2011 to 6.8% in 2012.
What do you think? Is this a temporary blip in the BPMS market or the first sign of a much bigger problem?