What would an integration software vendor -- Tibco (Quote) -- want with a provider of software that helps business managers make more important decisions?
Answer: more intelligent business process capabilities.
Tibco's move is the starting point of what some high-tech analysts have been predicting for the last few years: Business process management (BPM) (define) and business intelligence (BI) are becoming increasingly intertwined.
Forrester Research analyst Boris Evelson, who covers BI, said the purchase is the first transaction that will merge a pure-play middleware vendor with a pure-play BI vendor.
There are a number of reasons for a merger of such technologies.
Business managers rely on BI software to provide graphical reports about business processes. For example, a report might let managers know how their sales professionals performed in a specific region. Or BI might automatically alert business managers to depletions in a supply chain. In short, BI greatly influences business processes by giving managers salient data to make informed decisions.
BPM software, which is expected to lead the next generation of distributed computing, choreographs multiple business processes and enables disparate technologies employed in a distributed computer network to work together.
For example, BPM software includes graphical editors that let developers document business processes, such as the shipping of products in a supply chain. BPM might also include simulation tools to run a process, such as calculating a repayment plan for a loan, many times to measure its average time and cost.
Analysts believe combining BI with BPM -- kept separate and siloed -- will provide a more natural, dynamic computing environment.
While BI is a more mature, multi-billion-dollar market comprised of Business Objects (Quote), Cognos (Quote) and others, BPM has taken on greater importance with the move toward service-oriented architecture (SOA) (define) and Web 2.0 computing.
BPM frontrunners include IBM (Quote), BEA Systems (Quote), Tibco (Quote), Software AG and smaller, second-tier players. Oracle (Quote) offers both BPM and BI through its Fusion Middleware strategy, but the company hasn't technically intertwined the two yet.
Evelson said in his blog one of the reasons for such a marriage is that businesses can no longer stay competitive just by squeezing more efficiencies from operational applications such as BPM; they need the smarts BI applications can provide.
"For example, while workflow and rules are used to efficiently process a customer credit application, business intelligence analytics are needed to effectively segment customer population and extend the credit offer to a much more targeted customer segment for a better response, cross-sell/up-sell ratios," Evelson said.
Given the importance of meshing smarts with processes, you would think that the BPM and BI trains would have pulled in to the station at the same time. Not so, said Evelson's colleague, Forrester analyst Connie Moore.
"I think the BI vendors are missing the boat on process," Moore told internetnews.com. "They don't really understand process because they focus on analysis of data. Operational data, tactical data, strategic data; the data needs to be put into action. The BI vendors don't understand the whole process world."
This failure to grasp process may be why standalone BI vendors such as Business Objects, Cognos or MicroStrategy can be such good acquisition targets for BPM providers.
Moore said BPM vendors are increasingly realizing they need to improve their business processes, rules and event management with greater intelligence or analytics capabilities. Lacking the patience or technical wherewithal to build such technologies themselves, BPM vendors may have to buy them and integrate them.
"As BPM goes beyond process, some BPM vendors are cleverly adding integration with collaboration, portals and BI," Moore said. "I really believe that BPM is evolving into a bigger market, and BI vendors are at risk at missing a giant trend. Now Tibco buys Spotfire and it's just a matter of time before those [other BI] vendors get bought."