Middleware vendor Progress Software this week announced its acquisition of business process management (BPM) provider Savvion for $49 million in cash. The move broadens the already wide scope of products offered by Progress, expanding its BPM offerings.
Newly minted Progress CTO Dr. John Bates said Savvion was attractive because its offering includes business rules and document management as well as event and analytic engines. Also important, he said, were Savvion's pre-built process models for a number of industry verticals, including financial services, healthcare, communications and others.
Ovum analyst Tony Baer said the purchase made sense for Progress.
"It's a logical move," Baer said. "They did have a loose relationship with Lombardi [Software], but that wasn't going to fly after the IBM acquisition."
Baer said Savvion had developed more sophisticated BPM software than Lombardi and has been historically more enterprise-focused. But because Savvion was a smaller company, Baer said, enterprises were hesitant to buy in.
Savvion's president and CEO, Dr. Mohammad Ketabchi, founded the company in 1994 while he was professor of computer science at Santa Clara Universiry. The company shipped its first BPM product in 1999.
Bates and Ketabchi did not know each other in the pre-entrepreneurship academic world. But Bates said that while running Apama he had a similar approach to staffing as the Savvion CEO.
"Both of us have the same approach, which is to bring in Ph.D-level people to complement the business people in our organizations," said Bates. "There certainly was a sort of cultural connection there."
Of course the major reasons for the acquisition were not cultural. Progress was looking for a BPMS that integrated well with a number of its products particularly in business transaction assurance and CEP.
"We liked the fact that Savvion could actually handle events and respond within business processes," said Bates. "We also liked that Savvion had other capabilities, like an integrated business rules management system, an integrated document management system and built-in analytics."
In the scope of the BPM space at large, Baer recently wrote that he is concerned that BPM's "pure-play days are numbered, if you expect executable BPM." With the news of this acquisition coming only weeks after IBM announced it was buying Lombardi, BPM appears to be a space hit by consolidation.
Baer's major concern was that, while BPM is typically a business user's software, consolidation with highly technical platforms would make BPM more of an IT decision.
"I think there's a fear that we're going to just turn it into BPM as part of a SOA system," said Bates. "We see more and more in talking to customers of the ESB that IT users have to become more business oriented."
Meanwhile, at Progress, one of Bates' first initiatives at CTO is to unify its internal divisions by technological area to orient sales strategy around business users. Bates as well said users want BPM to bring IT closer to the business.