Documens Boss

SharePoint is an often-discussed topic in the ECM Sector today. Some key facts over the past several years clearly show why this is so:

• By mid-2007, SharePoint was experiencing 35% year to year growth, and had revenues in excess of $800 million

• In early 2008, Chairman Bill Gates announced that SharePoint was the fastest-growing product ever in Microsoft history and he expected sales of over 100 million licenses by mid-2008

• According to an IDG survey, 62% of CIO’s said that SharePoint was a critical component of their technology portfolio and would be expanding it’s use in the future. Primary areas of growth they identified, included:

o Business Process Management (63%)
o Records Management (40%)
o Web Content Management (39%)

• In 2009, when Windows sales showed a decline, SharePoint sales continued to rise; they broke the $1B mark in 2008, with more than 17,000 customers using SharePoint.

To learn more about the factors behind the dramatic growth of SharePoint and it’s impact on the ECM sector, Document Boss interviewed key individuals who have solid SharePoint knowledge, to hear their perspective. Included in our discussion were the following:
Mr. Ron Cameron, CEO of KnowledgeLake, a St. Louis ECM software company, offering Capture and Document Management solutions that embrace SharePoint technology, they have increased their size and revenue dramatically over the past years. (www.knowledgelake.com)
Mr. Doug Arthur and Mr. David Seaman, Founding Partners of Syntergy, a fast-growing ECM software company, whose solutions are embedded into SharePoint, adding key functionality and replication solutions. (www.syntergy.com)
Mr. Darren Edwards, Managing Director, Imagefast, an award-winning UK consulting and technical services company, supplying information management solutions to hundreds of commercial and public sector clients, both large and small. (www.imagefast.co.uk)
 
 
1) SharePoint adoption has been growing rapidly around the world, with the highest adoption rate in the US.  Do you see this rate of growth continuing?  Why or why not? Do you think the rate of adoption for ECM solutions will continue to grow?
 
(KnowledgeLake)
It’s true that SharePoint adoption is growing rapidly and has been since the release of SharePoint 2003 over 7 years ago.  It’s clear to see that SharePoint adoption will continue to grow because the technology is so affordable and so globally available.  The real key to this accelerated growth is the Microsoft partner eco-system.  Microsoft has tens of thousands of trained and experienced partners, currently building and deploying SharePoint applications for their customers.  None of the legacy ECM vendors has any comparable mechanism to drive this type of “grass roots” global adoption.
For years the adoption of ECM solutions in the overall industry has been growing steadily (even in a bad economy) due to the immediate ROI available by deploying these types of systems.  SharePoint however is growing at a much faster pace.
 
(Syntergy)
We agree; we think that SharePoint solutions will continue to grow rapidly, both in new installations but also in the accelerating number of users with larger deployments. Many enterprise clients that installed departmental Proofs of Concept have achieved the results and cost savings they have been seeking and are now deploying SharePoint enterprise-wide in locations around the world. 
Also, we see SharePoint being used with ECM but extending its usage into other areas, such as social networking, collaborative computing and cloud based computing - all areas that are growing very rapidly.
 
(Imagefast)
Imagefast see that the adoption rate is likely to grow for several reasons: Microsoft is aggressively pushing SharePoint and advocating its use in the wider enterprise. Their investment in this campaign will undoubtedly see an increase in the number of deployed SharePoint licenses; economic pressures are forcing organizations to look inwardly when looking to address new business problems with technology.     The end result is that they are realizing that they have this document centric, collaborative platform and are starting to ask themselves, “How can we use this to address our business issues?” and, “Can we use these SharePoint licenses that we already have, to avoid having to invest in a whole new ECM platform?” The improvements in SharePoint through version 2007 and the much anticipated 2010 have started to position SharePoint as a serious contender in the ECM space. 
ECM seems to be one of the topics of the moment and most companies are reviewing their existing document control systems to see where leverage can be gained by updating, replacing and integrating legacy systems that were typically implemented as point solutions.  Enterprise products such as SharePoint and other ECM products are now being considered in order to move from scattered ECM topologies to true enterprise solutions.
 

2) What do you see are the main reasons users are adopting SharePoint?
 
(Syntergy)
We see many factors for the dramatic rates of SharePoint adoption around the world. Some of the factors that have helped to drive our growth and expansion include:
1) Ease of use – users do not have to learn complex new user interfaces and controls.  The familiar Microsoft Desktop makes learning simple and non-threatening.
2) Ease of purchasing – while some may feel this is a small point, it is certainly not a trivial factor. Microsoft has done a great job in making SharePoint easy to acquire and easy to implement. Their MSTF model also makes it very easy to deploy throughout an enterprise
3) Cost of Ownership – the true cost of ownership is a big plus for SharePoint, which compares very favorably against other ECM systems.  In the current economic climate, this factor is driving people to SharePoint utilization.
4) Abundance of 3rd Party Products – the ability to utilize the core SharePoint platform and add key software components from a variety of sources is a huge benefit for users.  It gives a broad array of applications that can work within SharePoint to accomplish many diverse tasks.
 
(Imagefast) 
 A lot of companies are already using a whole host of Microsoft technologies and they are starting to realize that SharePoint can solve a lot of their business problems.  Whilst it may not be considered by some as ‘powerful’ as the leading ECM suites, it is still a viable contender and integrates well with existing Microsoft based infrastructures.  The release of 2010 with its office style, ribbon interface, will make it a lot easier for users to work with, as the user experience will be familiar and well integrated with users’ existing desktop productivity applications.  Other integrated technologies, such as BPM, Silverlight and Excel Services are all fighting the corner for SharePoint and making it an increasingly attractive option.

 (KnowledgeLake) 
Over the last years, we have seen five main reasons that users are adopting SharePoint:
1) SharePoint is very affordable and fits any size organization
As a rule of thumb, SharePoint licensing is approximately 10% the cost of comparable legacy ECM software.
2) SharePoint is an open and familiar technology platform
SharePoint solutions are built using familiar Microsoft .NET tools.  Any developer familiar with .NET development can pick up a book on SharePoint from a corner bookstore and be technically functional very quickly. 
3) SharePoint is low risk
SharePoint is a product made by Microsoft Corporation, the largest and most financially stable software company in the world.  I believe that the most important selection criterion for the buyer of ECM software is the financial viability of the ECM software company.  Due to the high value and mission critical nature of the content being stored, these types of solutions stay around for decades.  It is therefore, vital to select software from a vendor who can “go the distance”.  Also, the widespread adoption of SharePoint lowers the risk for every customer who may need to hire experienced technology people in the future.
4) SharePoint is widely available, marketed and sold
Unlike other vendors, Microsoft has thousands of partners who sell, design, build and implement SharePoint solutions for their customers.
5) SharePoint has a tremendous number of features and depth of capability
SharePoint is a compelling platform for every segment of the ECM marketplace including RM, DM, WCM, Portal and Collaboration.  

 
3) Is SharePoint now a scalable and robust platform for ECM applications?   If not, where do you consider it falls short?

(Imagefast)
One of the ongoing problems with SharePoint has been what has been termed “SharePoint Sprawl” where uncontrolled use of the product leads to uncontrolled content, redundant and duplicated information, difficulties in searching across multiple sites/site collections, inefficiencies and chaos.  This, however, has not been a problem with the product but a problem with its usage, based on the fact that it has had insufficient governance and lack of control in key areas such as site provisioning.  In the past, SharePoint has been installed, deployed and has expanded by default in an unrestrained fashion.  It is critical to get the planning right and tackle a SharePoint project with the same approach you would utilize for deploying any Enterprise ECM system.  A business needs to ensure that their infrastructure is solid and can support the anticipated growth of SharePoint and related content sources.  The product itself is highly scalable, whilst bolt on technologies, such as Bluethread’s StoragePoint, have addressed many of the issues around network based file storage which had historically been considered to be one of SharePoint’s weaknesses.  With the advent of the 2010 version, SharePoint is now far more scalable, far more robust and, with the introduction of FAST, far more a contender, than ever before.
 
(KnowledgeLake)
 I believe that SharePoint is by far the most scalable and robust platform that exists today for building world-class ECM solutions.  Our competitors continually use scalability as a FUD issue in sales situations.  Unfortunately, SharePoint picked up the “lack of scalability” reputation in its early releases.  The real fact is that SharePoint 2007 scales massively and in most cases better than the older competitive technology products.  If SharePoint has a shortcoming, it would be comparing SharePoint as a platform to many of the legacy ECM vendors finished vertical applications.  SharePoint does fall short in some of these comparisons; however, partners are rapidly filling these gaps.
 
(Syntergy)
With the release of SharePoint 2010, Microsoft continues the advancements necessary for enterprise scalable applications. However, as a large vendor, they cannot address all of the needs of individual customers in the many diverse vertical and horizontal application areas. Fortunately, there is a thriving community of partners that develop off the shelf solutions to extend SharePoint, and partners that develop custom applications to solve existing needs. Again, it is the strength of the Microsoft Eco-System that is helping drive the growth of a broad array of solutions.
 

4)  Opportunity or Threat?  How will "traditional" ECM companies take advantage of SharePoint and What is your company's product and sales strategy vis-à-vis SharePoint?

(KnowledgeLake) 
That’s a really great question.  The “traditional” ECM companies that make their revenues by selling maintenance services on legacy repository technology are definitely in trouble if they don’t reposition their value.  We see many of these companies in the market trying to protect their maintenance base by selling using a “dual repository” message, but most customers see right through it.  What customer would want to double their cost?  Who would really believe their story that “Microsoft SharePoint is a good portal or collaboration tool but not a good long term archive”… 
My guess is that Microsoft will be in business long after the “traditional” companies are out of business or have been acquired.  The bottom line is that it will be very hard for the “traditional” ECM companies to make a move toward SharePoint without jeopardizing their maintenance base.  At KnowledgeLake we embraced SharePoint in 2003, and it has been really great for us and even better for our customers.  The SharePoint market is on fire and will be even better with the coming launch SharePoint 2010.  Our overall strategy is to hold our course, accelerate, and maintain our position as the SharePoint ECM market leader.
 
(Syntergy)
Coming from roots in the “traditional” ECM space we have watched this evolution of strategy over the past years with interest. Many traditional ECM companies are embracing the SharePoint platform and are trying to extend their software model in order to maintain their installed base. The option for having their existing install base replaced by SharePoint is very real threat, especially as SharePoint evolves with SharePoint 2010. We feel a co-existence strategy currently is a survival strategy until the complexity of the system outweighs the migration costs.
 
(Imagefast)
Traditional ECM companies have had to adapt their strategies with the emergence of SharePoint, almost all ECM products now offer a SharePoint integration and many are moving towards SharePoint as their main collaborative platform.  They are realizing that they need to defend themselves against Microsoft’s aggressive position and are therefore refocusing and positioning themselves as Records Management, Compliance, Archiving solutions which can interface through SharePoint and add value to the Microsoft investment.
 

 
5) Does the growth of SharePoint provide incremental opportunities for ECM companies?   If so in which markets and application areas?
(Syntergy)
The SharePoint market space is a unique market, as ECM is really only one component of the wheel of business applications provided. The ability to address the many other segments and application areas as SharePoint continues to be deployed gives vendors the opportunity to expand their offering to collaborative, search and other social uses of the product. This expansion capability will continue to drive SharePoint deployment well into the future, creating a very rich and rewarding market space for both vendors and customers.
 
(Imagefast)
The emergence of SharePoint and the growth in social media has created a large issue for the CIO, as where traditionally managing the knowledge and intellectual property of an organization was a case of managing document and emails, it is now also managing blogs, wikis, project sites, team sites and data stored on mobile devices.  This diversification of where the knowledge is created and stored requires organizations to develop a robust information architecture, to ensure it captures and can find the information and knowledge that it has.  Some traditional ECM vendors such as Open Text have realized this and have set out their strategy accordingly to take advantage of this area.
Another area of growth that we see is using SharePoint as a unified platform to manage process around all businesses applications.  This helps organizations reduce the reliance on point solutions and potentially costly system integration projects for common business problems such as Contracts and Complaints management.
 
 (KnowledgeLake)
The short answer is “yes”, but it’s a complex market.  The smart “traditional” ECM companies are busy repositioning their offerings into vertical segments such as Healthcare, Financial Services and others to insulate themselves from the SharePoint demand.  I think this is smart business for them, but not necessarily for their customers.  Non-repository ECM companies are currently having great success in creating incremental revenue by building SharePoint integration into their applications.  Many of these applications are horizontal, but the strongest industry segments right now are healthcare and government.  The good news about SharePoint is that the opportunity is definitely global, it’s here right now, and it’s dynamically reshaping the ECM market.