IBM buys Austin-based Lombardi – Quick Analysis

This morning IBM announced that it was acquiring Austin-based Lombardi, a company that sells business process modeling platforms. I must confess, I’m not a BPM expert. At a high, non-specialist level “BPM” means modeling and mapping out the processes that businesses go through to run their organizations. Essentially, the modeling of all the tasks and decisions an organization goes through to do various parts of its business. “Workflows,” they call them. In the tech world, these BPM workflows get hooked up to various chunks of IT to automate things, kick things off, call for human intervention (to make a decision), etc.

What is BPM?

More so than gratuitous diagraming of the various tasks and workflows in a business, he hope is that BPM efforts let you improve (usually, make more money more faster) how your business runs. This is by first simply knowing what you have and what you’re doing (a huge step for most businesses) and then also being able to monitor and change those workflows. Part of that is that your business process is now (in theory) “instrumented,” in this case, meaning that software can interact with it (both to watch it and drive/manage the workflow) to presumably do things better and to allow you to more rapidly change that workflow to meet new customer demands and opportunities. Business Agility, they seem to be calling it. (Lombardi’s Wayne Snell has a nice explanation of what BPM is in a 2008 interview with AustinStartup.)

Fitting in with IBM

As such, for IBM, this fits nicely into the existing BPM market and also provides technology to do much of the instrumenting needed for their Smart Planet vision. As you’ll recall, in one way Smart Planet is all about applying enterprise software and technologies outside of the IT department: assume everything in the world, including ephemeral things like a “workflow” are IP addressable and programmable just like a server, and you’ve got Smart Planet wet-dreams galore. From what I could tell, IBM wasn’t as strong as it could be in the modeling and BPM space, and Lombardi will probably fill that technology hole in nicely.

It’ll also be interesting to see what IBM does with Lombardi’s newish SaaS (BPM in the cloud! ;>) offering, Blueprint.

This is also another space where the “we don’t sell applications” line from IBM’s Software Group gets a bit more strained. Sure, there’s no big ERP applications yet – and never mind all that Lotus stuff, like the Microsoft Office competitor Symphony – but BPM middleware gets about as close as you can to being an application that’s not an application.

Austin

In the Austin tech scene, Lombardi has been kicking around for awhile, since 2000 with investments from Austin Ventures and others. Along with CA buying NetQoS, Solarwinds IPO, and a few other events, this is another nice notch for Austin being a good town enterprise and back-end innovation. There’s a set of locals trying to add to that enterprise repudiation – we’re doing OK on that account with $8.4M kicking around of late, the “party like it’s 1999” folks over at HomeAway, and the hybrids like Spiceworks – but Austin certainly has plenty of “boring” (I say that tongue in cheek) enterprise software experts kicking around.

More Coverage

It seems like few things will get blogging analysts’ and commentator’s finger-blood flowing in the morning than a BPM buy:

• Chris Kanaracus covers the story for InfoWorld.
• Sandy Kemsley covers the IBM call this morning, and he own thoughts.
• Neil Ward-Dutton’s pre-call reactions.
• Tony Baer has some more detailed thoughts.
• And in his now-typical gonzo-y style, Miko Matsumura hammers out his thoughts.
• Also, see Lombardi’s president, Phil Gilbert’s blog on the topic.

Disclosure: IBM is a client.