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How the evolution of cloud services is driving BPM vendors

Despite predictions about its impending death, BPM continues to grow. A major driver for BPM vendors has been the evolution of cloud services.

Despite many prognostications about the impending death of business process management (BPM) tools, the field continues to grow. A major driver has been the evolution of cloud services to help make BPM principles easier to leverage. In addition, by combining BPM principles with other emerging trends like cognitive computing, agents, and the age of the customer and big data, organizations are starting to develop intelligent BPM (iBPM) to create more business value.

Stefan Reid, who recently left Forrester, said the cloud's biggest impact on the implementation of intelligent business processes is that processes, not just infrastructure, will be much more hybrid. He explained, "This means that business processes might start in the cloud, be mashed up with business logic or data from on-premises, continue on-premises, and end up in the cloud again."

A recent Forrester survey predicts that the combined software markets around business process management, multichannel capture and information-intensive smart process applications are expected to grow from $7.1 billion in 2012 to $14 billion in 2016. One of the fastest-growing segments is expected to be packaged cloud services for smart process applications, which is predicted to grow from $600 million in 2012 to $3.9 billion in 2016, representing a 59.7% compound annual rate of growth.

Reid said, "SaaS is a lot about packaged business processes. Look at; more than 2 million sales reps use the lead-to-order process basically in the same way. It might be extended with add-ons or custom extension, but nobody builds such a core CRM process from scratch on the platform. Traditional BPM products are being pushed back to the areas where no good SaaS applications are available."

BPM vendors being pushed to the cloud

Along with the explosion of the Internet of Things and wearable devices, the cloud is making it possible to engineer improved business processes. This is mainly a big data and event management challenge that organizations need to address, said Reid. He believes the majority of business processes are no longer initiated by humans, but by event networks acting on big data. But beyond this, the basic principles of BPM have not changed.

Leading BPM tool vendors are rapidly expanding their offerings to take advantage of the cloud. John Reynolds, product marketing director at Kofax, a BPM vendor, said, "We are being pushed to the cloud. We have potential clients now that only want a cloud implementation because of the convenience and cost savings that are surfacing."

There is finally recognition that BPM is not just a technology that automates business processes, but that will also revolutionize the way development is done.
E. Scott Mentervice president of business solutions, BP Logix

Many organizations still need to keep some of their business process in-house for governance, risk and compliance reasons. Thus, BPM vendors are also implementing iBPM solutions that can efficiently cross firewall boundaries. Reynolds explained, "Many organizations have one or more BPM systems in-house. The thought that a complete, end-to-end process will be implemented on a single BPM is no longer the norm with the cloud. You might have a business process-as-a-service in the cloud acting as a subprocess of a proprietary process hosted on-premises or in another cloud service. This is leading to a hybrid BPM solution as an orchestration of business processes."

E. Scott Menter, vice president of business solutions for BPM vendor BP Logix, believes more iBPM solutions are leading to new development paradigms in many organizations. He explained, "There is finally recognition that BPM is not just a technology that automates business processes, but [one] that will also revolutionize the way development is done."

Part of the problem is that most enterprise architects have a narrow idea of BPM's scope. Many organizations buy packaged apps that solve specific problems like procure to pay or human resources processing. BPM is used only for custom processes. Menter expects a shift in the use of BPM technologies as organizations learn they can create more custom applications with less coding.

BPM process control decentralized

One thing that may be changing in BPM centers is the decentralization of control in BPM processes, said Jim Sinur, CEO of BPM consultancy Flueresque. Sinur, who coined the term iBPM while at Gartner and who is the author of iBPMS: Impact and Opportunity, points to the growth of smart devices with embedded intelligence at the edge of networks that can more efficiently make decisions for many types of business processes. "Now it is possible to have a process that goes where it wants and is governed by constraints instead of being rule driven," he said.

Distributed architectures also allow organizations to move some decision making into cloud services, which might more efficiently orchestrate it. This can make a lot of sense, particularly when these business process engines rely on data coming from outside the firewall -- such as business appliances, devices in the field or mobile applications.

Sinur also said organizations are striking a balance between a traditional planning culture and figuring out what the process is after the fact. The former is the status quo for larger organizations in highly regulated industries. But many nimble startups build an application first and then try to understand the business process after they are making money. Sinur said, "The idea of automated process discovery and process mining is growing fast, and that is where we are headed as we get more complex control models where some of the authorization is on the edge."

Ultimately Sinur expects the cloud to enable both better planning and modeling after the fact. When modeling is done before the process is implemented, the cloud can help users collaborate across geographic regions and disciplines more easily. With smart execution, agents can be available in the cloud as dynamic services waiting to get tickled. There might be a Watson agent that does blood analysis for insurance companies, diagnoses cancer for hospitals or decides on the merits of a particular investment.

Sinur noted, "With flexible processes, old companies can transform to compete faster with upstarts like Uber. It will hurt old companies in the long run if they don't take up these adaptable, constraint-based, decentralized approaches with proper governance. There will always be the upstarts with smarter business models out there. The tried and true institutions need to incrementally transform to use this."

About the author:
George Lawton is a journalist based near San Francisco. Over the last 15 years, he's written more than 2,000 articles on computers, communications, business and other topics. Find out more at his website.

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This was last published in January 2015

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