In Focus: Content and BPM Vendors Swim Among the "Whales"

Independent vendors in the content management and business process
Astute followers of the software industry know that there will always be room for "sharks and dolphins" swimming among the "whales" such as IBM, Microsoft, Oracle and SAP. That point has hit home for me recently, as independent vendors in the content management and business process management (BPM) arena have darted in new directions even as the giants have aggressively sought to swallow up their markets.

In the content management arena, FileNet, Open Text, Hummingbird and other independents have taken a "if-you-can't-beat-them-join-them" tack as Microsoft and Oracle have ramped up their enterprise content management (ECM) infrastructure. In the latest twist, Open Text has declared it will become the first ECM vendor to give up the repository and run its content applications on top of Oracle's Content Database.

Describing the move as a "watershed event," Forrester's Connie Moore commented, "this announcement is a realization of our long-held belief that basic, enterprisewide content management capabilities would become the domain of infrastructure providers like Oracle, while more complex, industry-specific content management would be delivered by ECM vendors such as Open Text."

Open Text was already in bed with Microsoft, declaring its support and pending integrations with SharePoint and the Office 2007 suite. And last week, the company was up to its old acquisitive ways, launching an unsolicited, $27.75-per-share bid to acquire Hummingbird, which had previously agreed to sell itself to Symphony Technology Group for $1 less per share. Hummingbird is another ECM vendor that has vowed allegiance to SharePoint and Office, and one analyst I spoke with hinted it was a Faustian bargain in which the vendor had shown Microsoft all the tricks of the ECM trade.

Of course, ECM vendors used to describe their technology as "platforms" and "content infrastructure." But if future customers will use their accounts payable support, claim processing and loan origination "solutions" and "applications" on top of more generic, low-cost infrastructure, there's a future for ECM vendors even if functions such as check-in and check-out have been commoditized. The real question is, will those solutions and applications be any less expensive if they're built on infrastructure from one of the giants?

Turning to the BPM arena, independent vendors are swimming along quite nicely, even as the whales are trying to gobble up process management and service-oriented architecture (SOA) in one giant gulp. Late last month, Savvion released version 6.8 of its BusinessManager software, and President and CEO Shawn Price announced the company's intention to build an open "ProcessXchange" community with more than 1,000 prebuilt process models by year end. In a one-on-one interview he told me the next step after streamlining processes will naturally be outsourcing them. To that end, he said Savvion has wracked up deals with four of the top five business process outsourcing firms, including India's Satyam and Infosys, whereby those firms will be ready to run processes built on BusinessManager.

Fujitsu Software and Software AG are among the largest software vendors in Asia and Europe, respectively, but they teamed up a couple of years ago to better hold their own in the worldwide BPM and SOA markets against the industry whales. On July 11, the tandem unveiled version 2.1 of its jointly developed CentraSite integrated SOA registry and repository. Although Systinet is the leading SOA registry provider--with OEM deals with both Oracle and BEA--Fujitsu and Software AG executives say the emerging SOA and BPM markets are "far from settled."

Taking a page from the open-source playbook--a strategy also recently employed by Sun--Fujitsu and Software AG are stepping up the competition by introducing a Community Edition of CentraSite as part of the 2.1 release. The basic edition is free to end users and will reportedly be bundled by software vendor partners including ILog and Amberpoint.

Metastorm "swam with the sharks" when it gobbled up competitor CommerceQuest last year, but with combined revenues of about $50 million, the company knows it must work with, rather than against, multibillion-dollar infrastructure vendors. In Version 7 of the Metastorm BPM Suite, announced July 11, the vendor introduced Web parts for Microsoft SharePoint while also upgrading integration and business activity monitoring capabilities. The Web parts will enable users to monitor, collaborate and participate in Metastorm-managed processes through SharePoint dashboards.

So how can comparatively tiny BPM vendors compete when infrastructure vendors monopolize the attention of IT executives? "IT organizations are smart enough to realize that there's a long-term, underlying middleware, infrastructure and architecture effort that's going to take a very long time and be very costly," says Laura Mooney, Metastorm's director of product marketing. "But there is an immediate need to make the business more efficient and to improve business processes in the areas of customer service, compliance or supply chain operations. That's where a BPM system can leverage existing systems and infrastructure components."

Read this week's "Analysis" story to learn how Austin Energy realized a composite-application-based (rather than end-to-end) process improvement within six months as part of a long-term SOA initiative that has been underway for two years.