ECM Market Overview 2008

Software as a service (SaaS) options for ECM emerged—most notably through venture-backed SpringCM, and the focus of many midsize players (for example, Hyland and Xythos) is delivering SaaS options. The general hype around SaaS suggests that this delivery model is only likely to grow in importance through 2008, although it may not become the lifeline some mid-tier vendors hope it will offer.

For the buyer, Microsoft SharePoint is ubiquitous and represents a clear opportunity for collaboration scenarios, but it is an opportunity that has been massively overstated, and we would go so far as to say that Microsoft does not offer a full-scale ECM suite, even though that is what Redmond advertises. Buyers of Microsoft Office SharePoint Server (MOSS) should remain highly cautious this year (particularly when looking at larger deployments) and cognizant of the product’s shortcomings and strengths. Microsoft will have a full ECM offering at some point, but not yet. In 2008, we expect major changes to MOSS, but it remains to be seen how comprehensive those will be.

The year 2007 brought a much more competitive ECM suite market than we have seen for many years. The competitive options available will become stronger, and your ability to choose the right solution for you (not simply a generic "market leader") will increase, as will your leverage to bargain.

Market evolution

Indeed, the well-informed and cautious buyer will find many bargains in 2008, and in addition, there are some promising new technology solutions emerging—a situation only likely to improve throughout 2008. That is due in part to the huge amount of money now active in the ECM vendor community. With the massive R&D resources of Oracle, IBM and Microsoft, we can expect development to happen at a rapid pace, with seat pricing continuing to fall, putting ever increased pressure on smaller vendors to keep up.

Initially we will see the continued integration of acquired products into the acquiring companies’ product stacks, and, remember, it is a multiyear process. We will also see increased sophistication and use of services-oriented architectures (SOAs) in ECM. In fact, that is the number one area of focus for the MOI vendors, because it reflects the demands of larger enterprise buyers that are now considering content and process layers in their service-oriented enterprise architectures.

However, buyers should understand that by SOA, most vendors mean fairly simplistic Web services application programming interfaces (APIs), or the occasional representational state transfer (REST) approach. While all the larger ECM vendors tout loudly their SOA credentials and Web services-savvy approach, our research has shown that the reality is far from the marketing hype. In most cases, Web services are little more than a simple object access protocol (SOAP) layer to the old product set.

In 2008, we will see business process management (BPM, see related article on page 20) come to the fore in many situations, and the combination of BPM and SOA will be promoted as a means to process-enable more content-centric business activities. BPM has been around a long time, but what is different this time round is the focus on true enterprisewide approaches, based on standards such as Business Process Execution Language (BPEL), alongside integrated identity and authentication management. This offers the prospect that processes and content can potentially be managed across the entire enterprise in a holistic and consistent manner.

Change in the industry also demands a greater respect for standards, something that Oracle and IBM have traditionally emphasized, but an area in which niche ECM vendors have had a somewhat cavalier attitude in the past. That opens the door to open source suppliers who also love standards, and we witnessed in 2007 the emergence of credible open source ECM alternatives in the shape of Nuxeo and Alfresco. Standards will become ever more important in 2008/2009, but it remains an open question which standards will be of importance. Java Specification Request (JSR) 170 and now JSR 283 are gaining traction for repository services, and BPEL is gaining traction for process management. However, true ECM standards have not emerged, and may not do so. Initiatives are underway via the iECM standard (sponsored by AIIM) and an ECM standard from the British Standards Institute (BSI, bsi-global.com), but what those will cover and whether vendors and buyers will adopt them remains an open question.

Ongoing skills shortage

At the same time, there is a crisis in the ECM market that is unlikely to be resolved in the foreseeable future—one that most ECM technology buyers discover only too late. There is a chronic lack of specialist ECM skills in the marketplace.

The bottled-up demand for ECM technologies today is stymied and frustrated by the lack of appropriate skills and education to enable the tools to effect the profound and important changes necessary within many organizations. Finding a skilled and affordable EMC Documentum consultant or an ECM architect can be difficult, and your chances of locating a good ECM-aware business analyst can be near impossible. As the reach and impact of ECM grows, so too do the rotten projects: those that promise the world and fall staggeringly short of their intended aims. There is a need for vendors to be less proprietary about their products, encouraging both buyers and third-party consultants alike to want to embrace and learn in detail.

For those about to buy an ECM system, calculate upfront whether you can obtain and afford the necessary skills at technology and business levels to make a product work and deliver value. For many ECM buyers that will be the biggest challenge in 2008.

Near-term vendor risk profile

It is all too easy to select vendors for your shortlist based on their supposed "leadership" status in the market—status either given by analyst firms or by the vendors themselves. As this report describes, ECM represents a very wide range of technologies to solve and an equally wide range of business problems.

Our aim is to provide you with current and verified information to make the right "fit" for your specific needs. Once you have selected toolsets that meet your requirements, you also need to consider the status of the vendors. Again "leadership" status in a top right quadrant on an analyst chart does little more than tell you who has the biggest revenues in the sector, along with the widest array of technology to offer. It does not tell you whether the vendor’s corporate status is in a state of flux, or whether the product set is currently undergoing an overhaul, or whether both are in the process of becoming somewhat irrelevant in the marketplace due to a lack of innovation and investment.

All of those above factors involve risk to you, the buyer. The purpose of the chart on this page and analysis is to provide you with some key indicators to recognize and weigh the risks. It makes for interesting reading because the major brands do not always fare well and may, in some circumstances, represent an unacceptable risk.

To gain maximum value from the chart, consider two key factors: your own organization and the ECM marketplace. Each buying organization is different. What represents a high risk to one may represent a chance for innovation and a competitive advantage to another. What represents a staid, uninspiring and somewhat slow-moving product set to one may represent a solid area of comfort and low risk to another. Matching your appetite for change and risk against the vendors is an important element of the selection process. Equally important is the knowledge that this chart is in constant flux. Each edition looks different as new products and initiatives are launched and others mature. As many ECM projects stretch over many months (in some cases years), monitoring vendor movement is an important part of the project process.

Making sense of the chart

The chart on page 9 (KMWorld, Vol 17, Issue 2) represents four key dimensions that we believe should supplement functional and cost/value analyses in any major procurement decision. ECM systems will become integral to your business, and in committing to a purchase you are also by default committing to a long-term relationship with the vendor. Major ECM vendors dazzle, wine and dine your team, and appear to be a safe, conservative choice, but today, in fact, many are higher-risk partners.