By: Neil Ward-Dutton, Research Director, MWD Advisors
Published: 21st August 2012
This work is licensed under a Creative Commons License
The announcement of Savvion’s divestiture was one of the biggest surprises within Progress Software’s strategic about-turn. The BPM vendor’s founder is busy building momentum so that when the divestiture happens it can hit the ground running. It will have to be smart, though; since it was bought by Progress in 2010 the market for BPM technology platforms has moved on.
A couple of weeks back I had a conversation with Dr Ketabchi, founder of Savvion, to get an update on what’s been happening in that part of the Progress Software business since the new strategy announcement, and to discuss his intentions for the company post-divestment. Some of what we discussed can’t be shared here, but I know that there’s a lot of interest in our community about the future of Savvion; so here’s what I can share.
As I published a couple of months back, Progress has long since signalled its intention to divest the Savvion business, and this seems to be proceeding apace. In the period since the announcement, Dr. Ketabchi has created a semi-autonomous Savvion business within Progress, sharing back office admin functions and, to a degree, sales and marketing with the rest of the company and with dedicated R&D, sales, customer support and services teams that are all well-staffed.
At the same time the company has revisited its development roadmap, and has three separate releases pencilled in for the coming 12 month period. Broadly speaking, the development trajectory it was on when it was acquired by Progress in 2010 remains intact: key focus areas remain hosted delivery of tools, together with industry-specific process application acceleration. Both are going to be important for Savvion if it’s going to survive and thrive as a standalone entity: they’ve become table stakes in an increasingly competitive marketplace.
One of the obvious challenges faced by Savvion once it cuts itself loose from the Progress mothership will be international coverage. As a standalone entity Savvion will clearly have fewer international sales and support resources at its disposal. However it appears that the core local Savvion sales and support teams in Europe/Middle East/Africa and Asia-Pacific regions will remain, and Dr K has also retained the former Savvion India subsidiary. Picking the right opportunities will be important: in the two years that Savvion was under Progress’ wing, competitors have expanded their international presences.
I can’t share the detailed status of the divestment of Savvion, but it does appear likely that the company will divorce from Progress significantly before the Progress stated deadline of mid 2013.
What happens after that? One thing’s for sure: the funding vehicle or acquirer (whichever it turns out to be) won’t be satisfied with Savvion coasting by taking maintenance revenue from its existing customers – it will have to grow within these customer accounts, as well as winning new accounts. The good news is that there’s still an awful lot of opportunity out there for every BPM technology supplier: the challenge is that as BPM technology hits the mainstream, customer expectations are higher and also more diverse. Savvion should be partially supported by an ongoing licensing agreement with Progress that allows it to continue to use the Savvion codebase (as the underpinning for its OpenEdge:BPM offering), but that has to be almost discounted for the purposes of business development.
I’m planning to spend some time looking in some detail at Savvion’s planned development roadmap in the coming months, and you can be sure I’ll continue to share here whatever I can.
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