Why has the BPMS Market Stalled?

The BPMS MarketAccording 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:

The Cloud

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?

BPMS - No Need to Panic

BPMS – No Need to Panic

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Are Bosch the First Mover in the BPM Internet of Things?

Earlier this year I posted an article on BPM and the internet of things. I suggested that it’s pretty pointless having smart devices unless they can trigger business processes and to do this smart devices will inevitably be linked to BPM applications.

Internet of Things Ecosystem

Internet of Things Ecosystem

A number of companies Philips, Rest Devices, and Bosch have now started combining process management with the IoT. Of the established BPM vendors Bosch seem to be making the first move with yesterday’s announcement of their integrated BPM, Rules and Device Management software suite.

While traditionally BPM has focused on the automation and optimization of human centric tasks integration with smart devices will see BPM increasingly used for the orchestration of machine to machine and human to machine based business processes.

Much of recent BPM vendor and analyst focus has been on the extension of process to mobile devices with BPM being used to bridge the gap between what has been termed Systems of Engagement (Mobile, Tablets, App Internet, Social Media etc.) and the organization’s Systems of Record (ERP, CRM, legacy databases etc.). The systems of engagement v systems of record debate however ignores the role of smart devices. Many, many more smart devices will be connected to the internet than smart phones. GSMA estimates 24 billion devices will be connected by 2020, while Cisco and Ericsson think we will hit 50 billion.

The internet of things isn’t just a major opportunity for BPM it’s an opportunity for business intelligence, analytics and automatic capture vendors as well. Increasingly we will connect processes to smart devices in the same way we connect processes to CRM, ERP and legacy databases today.

BPM and the Internet of Things

For a while I associated the term “internet of things” (IOT) with some pretty depressing applications such as fridges that automatically order food or televisions that recommend what to watch based on previous viewing behavior thus trapping owners in death spiral of both eating and watching rubbish. In the past year or so IOT appears to have left its teenage years behind and begun to develop some maturity..

From insurance to medicine IOT applications are starting to spring up and deliver some significant benefits to users. For example in car telematics devices which monitor driver behavior and adjust the insurance premiums accordingly are becoming widely adopted, especially as a way of reducing premiums for young drivers. Some telematics providers include an accident service with the black box device alerting the insurer in the event of a collision.

In medicine we are seeing perhaps the most rapid adoption of IOT from smart pill bottles that can alert patients and can notify care providers if the bottle isn’t opened to heart monitors that allow health providers to continually monitor a patient’s heart rate, transmitting data to remote application where it can be interpreted by a doctor or consultant.

So how does all this apply to BPM? Fundamentally all of these smart devices are capturing data, whether it’s about themselves or their users. What’s the point of capturing all this data on whether granny has taken her pills, your driving performance or your personal health if it still takes ages for someone to find, analyze and route the data to the right person. As we can see from the telematics use case what is necessary is for the IOT device to trigger processes.

This is where BPM and the delivery of IOT process solutions come in. Just like with enterprise social networks the BPM tool has the potential to turbo charge IOT adoption. By taking the captured data and applying it directly to processes we can significantly enhance the value of IOT devices. What if the data from the heart monitor automatically triggered a new medical case or doctor’s appointment once a certain threshold was exceeded? What if the pill bottle alerted a carer or next of kin? Could we soon reach a point where an ambulance arrives to pick you up before you knew you were ill?

In reality IOT process solutions will be a mash up of multiple technologies from BPM and Case Management to Business Intelligence and Data Analytics delivered by multiple horizontal and vertical solution providers depending on their area of process expertise.

Once regarded as a back office application BPM is now firmly established in the front office through integration with CRM and ERP and increasingly through the delivery of mobile process applications BPM has also started to invade the customer realm. IOT integration simply represents the next phase in this journey.

Alert me when I’ve drunk too much!

Forrester v Gartner and the Future of BPM

Long regarded as the software equivalent of the offside rule in football, BPM might just be starting to get interesting. At long last there appears to be some debate happening in the BPM world with a gap emerging between analyst firms Forrester and Gartner on how they see the future of BPM (and Case Management).

First of all Gartner applied the paddles to the BPM corpse earlier this year with the announcement of their iBPMs (intelligent Business Process Management suite). They state that a iBPMs suite has all the features of today’s BPMS complemented with more advanced technologies like advanced analytics, business intelligence, social media and mobile applications. iBPMS use cases will integrate more analytics, social and mobile capabilities into processes making them more intelligent.

Confusingly though Gartner describe iBPMs as a new usage scenario, stating that it should not be compared with their previous BPMS MQ, yet they go on to state; “Our research indicates that the IBO use case represents the future of BPM tools and is experiencing rapid adoption.”

If Gartner have revived BPM Forrester might just have lobotomized the patient, completely changing its personality and how we will view BPM moving forward.  In contrast to Gartner, Forrester have a leaner, packaged, application vision for BPM and have defined a new process category called Smart Process Applications (SPA). These are packaged process apps that encompass many of the characteristics we associate with case management business processes including collaboration and variability. SPA characteristics include ease of use with the ability to be modified rapidly in response to changing business and market conditions. Crucially they expect the cloud to be the primary delivery infrastructure for SPAs making them easier to deploy, support and continuously improve.

Forrester’s confidence in the SPA market is such that they have put their neck on the block stating that they expect Business Process Management suites to be renamed “smart process platforms”.

So what’s my view? Who’s right Gartner or Forrester?

The cloud and the app. internet, as is the case for many SW applications, is a game changer for BPM. In our personal lives we are used to obtaining SW on demand, with little or no configuration required. We will and increasingly are expecting the same of our business software.

Like the software equivalent of Mr. Creosote Gartner’s iBPMS vision sees BPM moving in a different direction, continuing to expand and devour every new or emerging business trend its path. But is a BPMS really the best place for advanced Business Intelligence, Analytics and Social media capability or is it better to integrate with best practice elsewhere?  By adding all of these capabilities are we not continuing to make BPM more complex? Gartner’s iBPMS is a useful BPMS capability reference but iBPMS fails to address many of the issues holding back the wider adoption of BPM suites.

Gartner View of BPM

             Gartner View of BPM

Business process on demand, whether we call it BPaaS or SPA is the future of BPM.  BPM suites will continue to play an important role but increasingly as a cloud based engine for the delivery of on demand pre-built process applications rather than as an on premise application.

BPM in the cloud and BPaaS/SPA transform the business case for BPM applications extending the target market to small and medium sized organizations.  Increasingly organizations will look to these pre-built, good enough, on demand process applications rather than deploy and design their own in house processes. As a result I think Forrester’s leaner SPA vision rather than Gartner’s bloated iBPMS view represents the real future of BPM.

Forrester View of BPM

                                                              Forrester View of BPM

 

Can Process Improvement Eliminate Showrooming?

Showrooming is a relatively new phenomenon where a customer uses a bricks and mortar store to test and evaluate a product before buying it cheaper online. You’ve probably done it yourself. It can’t be long before, like a shoplifter, we see people thrown out of a store for using their smartphone to compare prices. It may already have happened.

The high street is suffering the double whammy of both the recession and the rise of ecommerce. While ultimately I think legislation will be necessary to protect bricks and mortar stores from their web based competitors the high street can begin the fight back by improving its business processes.

Retailers worried about showrooming can fight back but to do this they need to be clear on how they differentiate themselves from their online competitors. Many people for example will pay a small premium to get a product immediately rather than having to wait a few days for delivery. What this means is bricks and mortar stores must focus on their supply chain business processes. In addition the high street stores can offer customer post sale support, product training and immediate warranty replacement or returns that are more difficult do online. Again this requires a focus on post-sale business process.

It would be naïve however to ignore pricing. The recession has raised the importance of price to high levels and most people showroom to do a rapid price comparison between the price in store and the price they can get the same product online. Again this is an opportunity for business process improvement. Bricks and mortar stores can do price comparison as well.

Many high street stores are wedded to out of date, expensive to produce, catalogues of products whose prices are probably uncompetitive as soon as they are printed. There is no reason why bricks and mortar stores cannot automatically monitor competitor pricing and update point of sale prices in real time or produce a mobile app, with pricing that changes in real time, instead of a product catalogue.

Retailers are correctly looking to customer experience as a life raft for the high street yet incorrectly see customer experience in terms of gimmicks such as offering customers free wifi or a coffee shop without addressing their core business processes and the reasons why customers shop online.

When a customer enters a store the business has already done the hard part by getting the customer interested enough to get off the sofa and to visit their store. Improved business processes give them a better chance of converting that visitor into a customer and getting them to put away their smartphones.

Is the 360 Degree Customer View Still Valid?

In a nutshell the 360 degree customer view is the ability to provide your service agents with all of the information they need to make a decision. At a basic level this means presenting the agent with all of the data relevant to the case on which they are working, as well as historical data on the customer e.g. previous incidents, other account information, purchase history. Multiple business applications and customer databases mean that even today for many organizations a basic 360 degree customer view, showing current and historical customer data, has been difficult to achieve.

In order to make the best decision on behalf of the customer and their organization agents need more than just historical and current customer information they also need future projections for the customer for example their estimated lifetime value and their potential to churn. Agents also need to be aware of current organization business targets as well as real time competitive information to for example validate customer claims about a competitive offer. Thus the 360 degree customer view is evolving extending beyond current and historical customer data to encompass future customer predictions, an organization perspective as well as competitive information.

As Data Analytics, CRM, BPM and Case Management applications begin to coalesce we will see new attempts to deliver the 360 customer view. CRM applications will continue to be used to manage the customer data and are today being be extended using BPM applications to automate and remove the mundane customer processes from the agent workload and Case Management applications to allow agents to handle complex customer cases and integrate with multiple data repositories. Add analytics tools that deliver predictions about future customer behaviour and real time data on your competitors and we begin to see how the service desk of the future will look.

The 360 degree customer view remains a valid if poorly executed concept.  With CRM, BPM, Case Management and Data Analytics we might however be on the verge of reaching the holy grail.

The Ideal Customer Service Agent