Friday, 8 May 2009

The Captain of any ship knows the danger of seeing just “The Tip of the Iceberg”

So Open Text have bagged Vignette and the last large, independent ECM player is about to melt away!

Is that good news or bad news for the industry?

For the industry analysts it is probably bad news, since the small visible tip of the industry that they viewed (and most other industry "experts") has just got smaller.

Is that good news or bad news?

If you’re a senior executive in this industry, managing an ECM, EDM, BPM or document centric BPO company and you have previously used these "experts" to keep you informed, perhaps setting your future strategy by their analysis, I suppose that could give you some cause for concern. Their analysis will now be even more skewed and extrapolated.

Is that good news or bad news?

Actually, I think the fact that the pontificating, crystal ball gazers will now be rightly exposed as talking eloquently out of their "hulls" for the past few years is actually a very good thing! There are many good executives in this industry who don't need the "Mystic Megs" to create a profitable company. They especially do not need experts who see just the tip of the iceberg and, based upon such a limited overview, extrapolate theories for where this industry is heading.

In the same way that the Captain of the Titanic got his bearings wrong, it is just as likely that the crystal ball gazers have too. The most annoying thing is that they are selling something based on what will happen in the future and is consequently, hard to challenge. How many analysts are held to account for their reports of five or ten years ago?

“It says here in your report that this industry would be worth $450 billion by now. Well where is it? Can I have my money back please? By the way, don’t let the door hit your backside on your way out!”

There is a lot more life left in this industry and I suspect that we are about to enter probably one of the most exciting stages for this technology sector. New companies are now free to emerge above the waterline as the new shining vessels of success. There will be a lot more acquisitions but not of the size we have seen in the past, until we start to see some multiple acquisition roll-ups.

What is evident to just a few, is the real size of this industry, globally. What has been seen by the many is just the tip of the iceberg. The few big players, sitting proud above the waves, attracting the attention of the analysts and the media. That tip has now melted away to just a few now!
What has previously only been appreciated by just the few, is what lies beneath the glare of the bright sun of publicity. Innovation is there and thriving. Technology, talent and passion that, with the right nurturing, will make it into the sunlight.

The time has come for the entrepreneurs from the SME's to make their way to the surface. (Note to self: I may be carrying this analogy too far now) There is a lot of talent, innovation, value and not an inconsequential amount of profit, hidden away in the companies that have been lurking in the shadows below. This is where the new stars of the industry will arise from. The business world has changed and it will continue to change at an every increasing pace. The big boys can disappear quickly in one brief storm and new players can quickly rise to prominence, due to increased access to information and better communication.

The ECM iceberg has not melted away as the crystal ball gazers had predicted, it has just disappeared from THEIR view. The weight is below the waterline.

Is that a good thing or a bad thing? Who knows? Personally, I can't wait to find out! Good Bye Mystic Meg and let's bring on the party. This is when the fun really starts for those that can see below the Plimsoll line.

If you would like to come diving below the waves and find out what potential treasures are hidden below for your company, please get in contact.


  1. I think all the M&A activity is a good thing. It reduces the choices and allows smaller players to be seen. The problem is that the analysts are simply blind to the fact that their 'markets' i.e. ECM or BPM, do no longer exists.

    Where do you put and rate a company like ISIS Papyrus that is ECM, BPM, CRM and BI in one product and offers a lot more value than any standalone silo player. Even those like EMC who try to play the consolidation game by acquisition face the strong headwind of practical integration. I see OpenText plus Vignette as a lesser competitor because their offering just became more complex and more difficult to innovate.

  2. Thank you Max for your comments. It is not always easy to pigeon hole companies and to be frank why should we want to? It tends to be just the analysts that need to do that for the purpose of their own analysis.

    I agree with your comment that the acquisitions reduces choice but only if you are talking about the big players. Document Boss has monitored the WHOLE industry for ten years. There are now more companies in this sector than at any time in the past. The exciting prospect is there are bountiful opportunities for some of the SME's to make some significant growth spurts.

    History has taught us that generally in business that the big and powerful will eventually dominate and takeover. Is this now still true to the same extent when companies achieve the growth seen in such examples as Google, Facebook, eBay etc. we are entering a new age of business. Perhaps we are entering the age of the "technological cottage industry" where smaller companies that can respond to market and client demands more quickly will have a strong hold on the market!

    Who knows? I know I don't but it will be interesting to see but in reality not in my crystal ball :-)

  3. Mark:
    Don't forget that Open Text is still a "large independent ECM vendor," so until SAP or someone buys them, there is at least one standing.

  4. That's true Ralph well spotted. I should have written "apart from Open Text". Perhaps I will now :-)

  5. Good piece, I say that even though I am a "Mystic Meg" myself, leading the ECM research at the analyst firm CMS Watch.

    A couple of points is right and fair to have a go at analysts, and to hold us to account. I have ten years in the industry and hae published literally hundreds of papers. I haven't got it right all the time, and when I get it wrong its right and proper for that to be pulled up and noted. But I think you throw all analysts into the same bag here, and that seems a little unfair. Not all analysts agree all the time, and not all analysts are good. Some are not very good at all, some do a very good job.

    From my side of the equation, I only work for and advise buyers of technology. (Previously at Ovum I advised vendors). Currently I cover 30 ECM vendors, and CMS Watch (focused only Content technology software) evaluates about 200 products in total. Yet there are many vendors out there that we do not, or simply cannot cover. The market in our eyes is not small, it's huge and highly fragmented.

    Bucketing vendors into categories such as ECM, BPM, CMS etc is messy and innacurate (even unfair sometimes), but frankly nobody has come up with a better way to do it, and buyers recognize and respond to those categories.

    The acquisition of Vignette (and Interwoven by Autonomy) does not shrink the market at all - as the products live on, and if anything it complicates it further. It's my job and priveledge to help buyers make sense of it all - and that is no easy task at times. For not only do we need to make sense of the market, we also need to make sense of the product offerings, figuring out what works, what doesn't and everything in between - and trust me vendors are only interested in showing what works, its our job to dig deeper.

    Anyhow, I shan't write an essay - I like the blog and I love the newsletter. I am also thick skinned (I have to be in this job). All I ask is that you look at the analysts as you would the EDM/ECM sector - there are lots of opinions and approaches, you need to pick the one that seems most accurate and works for you. And yes, hold them (or me) to account when we get it wrong.


    CMS Watch

  6. Alan thank you for your comment and the gentle slap on the wrist. :-)

    As you can probably read from some of my sweeping statements that I have over the years become quite disalussioned by the real value that analysts have brought to my clients businesses.

    However, you sound far to reasonable and level headed. I can see you might spoil my fun the next time I have a pop at the "Mystic Megs" of our industry I might start to feel a little bit guilty.

    Maybe we should have a chat off-line as I would like to know a little more about CMS Watch. See my contact details below.

    All the best
    Mark Edwards | CEO | Document Boss
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