40% BPM Initiatives use Cloud Computing for 10+% of BPM Business Processes
Recent surveys by analyst firm Gartner revealed that cloud computing is now a firm component in business process management (BPM) initiatives. The data shows however that cloud computing is not used in the same way within these initiatives.
Specifically, one of the research studies, the 2010 BPM-end-user adoption survey, found that 40% of organizations with BPM initiatives were using public or private cloud services to support at least 10% of their business processes within those BPM projects.
“Many business process improvement (BPI) leaders are looking to understand how cloud services and cloud platforms can help them improve business processes within their organizations, as well as inter-enterprise processes that touch partners, suppliers and customers,” said Michele Cantara, VP of Research at Gartner. “Managers of shared-service centers who are tasked with standardizing business processes are investigating cloud-enabled BPM technology platforms as a foundation for business process services in a private cloud. External service providers (ESPs), particularly business process outsourcing providers who want to improve their margins, are also interested in using cloud-enabled BPM technology platforms to deliver one-to-many business process services in a cloud-enabled outsourcing delivery model.”
Ms. Cantara explained that BPM platform as a service (PaaS) and cloud-enabled BPM platforms are often confused. ‘BPM PaaS’ refers to the delivery of a BPM technology as a service by a cloud service provider while ‘cloud-enabled BPM platform’ refers to a BPM platform product that supports cloud services.
Seen from the demand side, the growth in public business process services and the increasing availability of BPM PaaS for constructing those business process services is fueling increased demand for BPM cloud-enabled platform capabilities. In addition, buyers are using BPM PaaS in pilot projects to build a business case for on-premises BPM solutions; in development and test environments to avoid additional capital expenditures on software and hardware; and as an elastic deployment option to address spiky and unpredictable demand.
Buyers are using cloud-enabled BPM platforms (BPM CEAPs) to support shared business process service centers in their own private clouds. This trend is spurred by a desire not only to consolidate applications and standardize business processes to reduce costs, but also to better control and manage the work of the organization.
The 2010 Gartner BPM end-user adoption survey showed that 13 percent of organizations that were doing BPM viewed BPM PaaS/BPM CEAP as one of the top five BPM technology capabilities critical to the success of their BPM efforts. Compared with North American and European organizations, significantly more Latin American and Asia/Pacific organizations considered BPM PaaS/BPM CEAPs to be among the top five most important BPM capabilities. These findings are consistent with other Gartner user surveys, which show Latin America and Asia/Pacific with the highest investments in public and private cloud services.
In all regions, more respondents in IT roles view BPM PaaS/BPM CEAP as one of the top five most important BPM capabilities. However, in North America and Latin America, a nearly equal percentage of both business and IT respondents within those regions viewed BPM PaaS/BPM CEAP as important to their BPM success. This suggests that business leaders in these regions are becoming increasingly aware of BPM PaaS/BPM CEAP.
The survey also showed that two-thirds of organizations fund BPM efforts out of a line-of-business (LOB) budget, and 47 percent fund BPM out of IT. Multiple responses were allowed, and 7 percent of organizations use dual business and IT funding streams for BPM. The preponderance of LOB funding means that business process leaders are more empowered to seek out solutions that may not involve IT. BPM PaaS, combined with consulting and system integration services, and managed services from an ESP to support the entire solution on an ongoing basis, is not uncommon.
From a vendor point of view, the 2010 Gartner survey of BPM PaaS and cloud-enabled platform vendors revealed that a vendor that offers BPM cloud-enabled platform products is also likely to offer BPM PaaS. In fact, only 8 percent of vendors offered only their BPM platforms as a product while 59 percent of vendors surveyed offered the same capability both as a service and as a platform product.
A third of the vendors surveyed only offer BPM platform capabilities as cloud services. These ‘BPM PaaS only’ vendors tended to be newer and smaller entrants to the BPM market, underscoring that cloud reduces barriers to entry for new vendors. Nearly 75 percent of these BPM cloud-related services offered by these vendors are available worldwide, demonstrating that cloud services are an effective mechanism for enabling a worldwide reach, even for smaller vendors.
Notes to Editors:
* Note 1: 2010 BPM adoption survey: August 2010 through September 2010, Gartner conducted a worldwide primary research survey of 593 end-user organizations using Web-based and computer-assisted telephone interviewing (CATI) methods. The objective of the survey was to understand their preferences, practices and investment plans related to BPM.
* Note 2: BPM PaaS and cloud-enabled platform vendor survey methodology: In July 2010, Gartner compiled a list of software and service vendors who were known to offer cloud software or services. More than 90 software and service vendors participated in two studies:
Cloud-enabled BPM platform and BPM PaaS capabilities
Separate questionnaires were developed for each study, and the studies were conducted July 2010 through September 2010.