It was the new Appian 6.5, code name Tempo.

It’s a revolution of new functionality, and because it is so novel it has undergone an unusually long testing and acceptance cycle. We’ve run our company on it for nearly six months now, and it’s been in development for more than a year. We took our time because in an uncertain market, we wanted to get the concept exactly right.

Our intention was to set the new standard for mobile and social BPM.

Our mobile BPM is native and full-featured. It works on all platforms. You can download it free from the iTunes store. It installs and loads in a breeze. It is a pleasure to use. It renders native forms and enables fingerswipe approvals. Despite its utter simplicity of interface, it offers full functionality. It allows the user to drill deeply into new issues, or resolve them in a gesture. It gives you the easiest user experience in BPM.

Work wants to be mobile. There is enormous demand for mobile productivity, satisfied at last by the provision of smart phones and tablets. What still lacks is process software to enable that productivity. The software we need will be simple but powerful. Simple because the platform and mobile bandwidth require it and the mobile user demands it. Powerful because a decision still requires full information and full collaboration – you just want to do it from the road.

Appian’s social BPM is not idle ‘chatter’. It is all business. It is based on business events (not just changes) or even the absence of an event (often that’s what most requires action). It is woven deeply into the process of work. You see issues, discuss issues, and resolve issues. To resolve them you fill forms, make approvals, pass variables – and form ad-hoc teams of interest around every topic that arises. Social BPM should make you a participant, not a spectator, in every process. Every comment matters, and goes right to the record and to the people who need to know it. Everyone is included because the interface reaches every mobile executive and traveller. Great social BPM is also a learning experience. Peruse the various events and you can hear the pulse of your business. When I use Appian 6.5, I learn things about my organization that I didn’t learn from the corner office, things that mere proximity never taught me. Whether you’re the CEO or the newest employee, the window this offers on the business is invaluable.

Appian 6.5 is for everybody, but it will appeal particularly to the mobile decision-maker: the executive who travels a lot, doesn’t want to learn a new interface, needs to review and approve things frequently, and wishes they were up to date on everything that happened at the office. For that executive, we’re about to become indispensable. Our interface is simple, we are native on their favorite mobile device, and we integrate them into the process and activities of the organization like no other app can do. This is the promise of social BPM.

Appian was already the runaway leader in cloud BPM. We’ve been live with full-featured cloud BPM since 2007. Four years later, no other major vendor can say the same. To our longstanding lead in the cloud we add leadership in mobile and social BPM. These are the three primary inflection points in enterprise software today.

One last note: whenever Appian incorporates an inflection point into its architecture, it does so at the most fundamental level. When we went cloud, we released a cloud product that was 100% identical to our on-premise version. Now that we are mobile, our native mobile interface works just like our new browser interface. Our social features are not in a separate application with a separate price, they overlay on our standard interface and apply to everything inside. In this way we are different from all of our competitors. Mobile, Cloud, and Social are not side applications at Appian; we’ve written them into our DNA.

Matt Calkins, President & CEO

We grew 58% over last quarter (not last year) which is to say the company is 58% bigger than it was 90 days ago.  There are multiple reasons for this.

The exponential growth of SaaS BPM is a big factor.  Our cloud-based business has doubled every quarter for the past year, such that Q1’s take was roughly the size of all quarters before it.  We closed our first SaaS BPM deal in the federal government, and our largest to date, both this past quarter.

Another primary reason was the absorption of our most direct competitors, Lombardi and Savvion, into the IBM and Progress Software stacks.  This has boosted our profile (so we make nearly every competitive short list), and elevated our win ratio.  As our win rate was always high, the former effect is the more important.

But what their absorption does for us today is a shadow of what it will do for us going forward.

It is clear that BPM is in flux.  I don’t mean that there is consolidation going on, though there is.  I mean that there is product innovation, and that the industry is still in the midst of definitional transformation.  And yet these two types of change are often opposed.  More consolidation generally means less innovation, particularly at the consolidated firms.  This is why consolidation often occurs once an industry is established and relatively feature-complete.  BPM is not.  The BPM you’ll see in 5 years (which, by the way, will not be called “BPM”) will be strikingly different.  To the 2015 consumer, 2010 BPM will be inoperably deficient.

At Appian, we’re building 2015 BPM.  We think about it every day.  My standing desk is covered with sketches of new features.  We discuss new mockups weekly.  These features will change BPM.  If you benefit from the advancement of this industry, we’re working for you.  If other firms are not, the gap will widen.  The 2015 market will be much larger than the 2010 market – and regardless of what happened in Q1, it is the 2015 market where we expect to have our biggest advantage.

Matt Calkins, President & CEO

• Progress wins.  This transaction makes sense in a way the IBM-Lombardi deal did not.  Progress’ suite of products is complementary to BPM.  Progress has a declining cash-cow business, and the new CEO (Rich Reidy) knows that diversification through acquisition is the right way to segue from a past strength to a future strength.  Were I a Progress shareholder (I am not) I would applaud the transaction on strategic grounds and be delighted with the price.
• Savvion wins.  For at least 24 months Savvion has been widely understood to be seeking a sale, and if that is the case, then they must be pleased to have found one.  The downside is that they are joining a firm unlikely to innovate under a BPM banner.  Progress wants to sell a stack, not BPM.  They are also economizing, having just cut 250 jobs (out of 1,875) last month.
• BPM vendors win.  One fewer pure-play competitor.
• Technology consumers win.  Progress will deliver the BPM concepts more widely, to a more uncommitted market, than Savvion would have reached.  BPM will become more popular more quickly.

Left out of the festivities are Savvion customers – who surely do not win.  Savvion will now lower the banner of innovation and dedicate itself to integrating with a stack few firms own.  Their clients should transition to a BPM innovator with momentum and a long-term outlook.  They will find a friendly welcome at Appian.

Though we can list several winners, there should be no doubt who is the greatest beneficiary: Appian.  No entity gains more from the acquisition of Savvion, or from the disappearance of Lombardi into the gears of IBM.  These competitors, formidable in their time, are now repurposed and will not recapture their innovative edge.  Appian’s position is now undisputed — every blog I have read today lists Appian as the last pure-play champion.

On Column2, Sandy Kemsley writes: “Of the three mid-range BPMS-only vendors that I would most commonly name – Appian, Lombardi and Savvion – that’s two out of the three announcing acquisition in less than a month.”  Bruce Silver recalls the line-up a few years back and lists “four vendors on the business-centric end of the BPMS landscape … Lombardi, Savvion, Fuego, and Appian”.

Why is Appian the vendor remaining?  I know why: It’s because of that smelly old building we used to work in with the lease that said we had to leave within a month whenever they decided to knock the structure down.  And because our founders have packed sleeping bags to a client’s server room.  And because the whole company worked 6-day weeks and we had no marketing department.  We’re still here because from the beginning, whatever the compromises, we challenged ourselves to build a sustainable business.  We spent time and sweat rather than money (we still do).  Lombardi and Savvion arrived at the same point, but Appian got there the hard way.

Quick fact: All three firms (Appian, Lombardi, Savvion) were universally considered leaders since at least 2006.  Lombardi and Savvion both took $55-75 million to get there.  Appian did it on $5,000 in seed capital.  (Later, in 2008, Appian took a $10 million investment.)

The irony of these acquisitions is that they take BPM to exactly the place BPM was going, but faster.  Here’s what I mean:  Appian had a special 2009.  Wait for our later announcement(s), but I think I can say that no major vendor grew as quickly nor gathered such a crowd at their user conference.  (We even outdrew most analyst shows.)  By the end of 2009 – even before these acquisitions were announced — it was clear to us that there was a new contest in BPM: Appian vs. Pega.

One final note: Lombardi and Savvion didn’t leave this market because there wasn’t value, they left because they ran out of time.  (For a venture-controlled company, time is everything.)  There’s a great market here, and a sudden lack of competitors.  Appian is not for sale.  Our product is strong, our staff is extraordinary, and we have the most enthusiastic user community in the business.  For a while we shared the spotlight; now we are ready to own it.

Matt Calkins, President & CEO

You have heard by now that IBM is buying Lombardi. We welcome this transaction, as it will help us to achieve our goal more quickly. Lombardi has now marginalized itself, and will soon be entangled in the IBM stack. No BPM company has ever maintained its innovative vitality after being acquired.

The reason is simple: the giant vendors who make these acquisitions don’t need to innovate to win market share. They have less to gain, therefore, from being a ‘feature leader’ (and are temperamentally unsuited, to boot). I expect IBM will not be a serious innovator in BPM – and Lombardi customers will suffer from increased confusion as they attempt to navigate the complex array of IBM BPM technologies to determine what to deploy where, and what is integrated with what.

Where will customers turn if they want innovative BPM and rapid time to value? To Appian.

This move meets my expectations for consolidation in the BPM market, and makes me more excited and optimistic than ever about Appian’s future.

Matt Calkins, President and CEO