ECM's Future Is In Automation

When I sat down to contemplate the events that shaped the ECM landscape during the last year and what should be expected in 2009, I had created illusions of grandeur in my own mind. I was hoping to reflect on earth-shattering announcements or unexpected advances in technology. However, looking back over 2008 I found myself asking, "What really did happen?" On the surface, the past 12 months in ECM didn't produce any news that I would label as 'earth-shattering.' But then, that shouldn't be surprising, since Business Solutions predicted this to be the case in last year's edition of Executive Insight. However, a lack of drama in the industry doesn't mean the ECM pool has gone stagnant by any means.

Expect Stronger Options For VARs
Vendor consolidation has continued this year, with recent acquisitions such as Oracle's consumption of Captovation and Open Text's purchase of Captaris being some examples. But, acquisition within the industry has become more than the cannibalistic approach of bigger, stronger vendors preying on those that are smaller or less financially stable. Today, acquisition has become one method of filling potential gaps within a vendor's ECM technology framework. For example, data capture vendor Kofax recently purchased Sweden's OptiInvoice for the specific purpose of gaining expertise in electronic invoice and EDI (electronic data interchange) in order to establish a foothold into that growing market. This type of acquisition strategy is great for vendors trying to maintain a competitive advantage. It also expands sales opportunities for VARs to target new market opportunities, as well. 

Hardware commoditization has also continued to impact on the ECM landscape. This is actually good news for VARs. Scanning manufacturers struggling to combat the effects of commoditization are desperate to differentiate themselves from the competition. As a result, some are providing more 'out of the box' functionality and integration flexibility by developing and releasing versions of their own proprietary data capture software. For instance, Kodak made its formal entrance into the data capture software market this year through release of its own Capture Pro Software and then followed through by offering a version compatible with the majority of scanner brands on the market today. It will be interesting to see how many vendors follow this approach and just how these new capture products will fare in the channel during the coming year. At the very least, these products add more choices to the already veritable smorgasbord of capture options on the market today.

ECM — A Great Solution To Sell In Challenging Economic Times
The current economic downslide shouldn't be viewed as all bad news, especially to savvy ECM VARs. Think about it. What happens when times are tough and finances are lean? Companies are forced to do more with less in order to survive. This will continue to drive the trend toward business process optimization and automation that has been on the rise over the last 18 to 24 months. However, unlike the past, where optimization and automation have been viewed as enterprise luxuries, companies of all sizes now will be looking to adopt these solutions. However, companies need solutions that can provide more than just capture, storage, and retrieval. The hottest sales opportunities exist for VARs that can streamline an entire business process from the point of information entry by integrating automated classification, recognition, and workflow technologies into a single, cohesive package.

That said, the ability to automate mission-critical business processes doesn't mean every solution sale will be easy in the year ahead. ECM VARs who have focused their efforts in the traditionally lucrative financial and insurance services sector should be prepared for the challenges that lie ahead. Obviously, IT spending in these verticals is likely to be tight in the near term. But the market crisis of buyouts, bailouts, and closings also means there will be fewer of these customers to go around. The best advice to VARs with most of their eggs in this basket? Don't give up. Concentrate more than ever on becoming an indispensable asset to your customer by continually educating them on the benefits of automating business processes and clearly illustrating the potential for ROI. This will not only build and maintain a loyal customer base, it also will increase your chances of getting that new project approved as soon as the money starts flowing again.