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?
July 10th 2008 was a watershed date in personal computing. On this date Apple launched the App Store marking the first time that software applications could be purchased and installed onto a mobile device without having to sync with a PC or laptop. The App Store, launched with 552 applications, has now over 1 million apps. The launch of the App store wasn’t just a key moment for personal computing; this event also triggered fundamental changes in enterprise computing as well.
Our personal technology experience has changed our business IT expectations. The ability to download a game or a lifestyle software application in seconds and use it intuitively without recourse to a user guide is now taken for granted in our personal lives. When it comes to how we use software in our professional lives things have moved much slower. In the enterprise long software purchase lifecycles with large up front license and professional services costs still dominate. However this model is now under pressure from post pc employees frustrated with delays in software selection, approval, implementation and change timescales as well as business leaders determined to drive down upfront cost and total cost of ownership.
The consumerization of IT is the manifestation of employee desire to bring their personal IT experience into their working lives. Employees are increasingly creating their own technology solutions to address business problems. Bring your own technology (BYOT) has been most aggressively adopted by senior executives with Forrester reporting that 77% of executives buy their own hardware and 45% self-provision software. With this senior level endorsement BYOT is an issue that’s not going away for IT departments.
Into this brave new world steps the Business Process Management (BPM) suite. Established BPM practices are an anachronism in the post pc, consumerized business environment of today. Creation of BPM centers of excellence, the complexity of many BPM suites, heavy implementation, integration and professional services costs contrast greatly with the demands of the consumerized employee. Employees and executives are looking for a short term tactical play where previously BPM only offered a strategic one.
Rather than product or price, in the new millennium business agility and customer experience are the key competitive differentiators. Whether it’s a pop-up store or Instagram, where a $1Bn business was built on 13 people and scaled to over 14M users in little over a year using a variety of cloud technologies, the ability to rapidly deliver processes gives an organization the edge. Step forward consumerized BPM.
I was watching the current season of Mad Men last night and a bit of dialogue struck a chord. Ted Chaough was flying his new colleague Don Draper in his small private plane to a meeting with a client. After some bumpy weather Ted uses an airplane analogy, “Sometimes in life you think you’re the right way up when in fact you’re upside down. Gotta check your instruments.”
Mad Men – Ted and Don
This got me thinking about BPM. BPM has for a long time been regarded as a strategic play. It’s often said that successful BPM projects require both cultural and strategic change within organizations. Establishment of BPM centers of excellence, back office integration and the optimization of processes that cut across multiple departments all require that the organization and its employees are in sync and are willing to review established practices. But all of this takes time, effort and significant cost, creating barriers for widespread BPM adoption, putting the BPM suite out of reach for many smaller and medium sized businesses. All this time we’ve been recommending building this huge BPM ecosystem within enterprises and have then wondered why BPM has struggled to take off.
Maybe all this time we’ve been flying upside down. Maybe we should have been deploying rapid, pre-built or almost pre-built BPM applications, with clear business value and rapid ROI. Maybe we should have been searching for the quick win, to show off the potential of BPM suites before thinking about broader, more strategic process improvement.