Once again, I caught up with Appian CEO Matt Calkins. This time it was in the midst of their virtual user conference this month. (Here’s a link to my Nov 2020 update and here’s diginomica colleague Martin Banks take on his conversation with Appian’s CEO and CTO a couple of weeks ago.) Banks’ discussion with Calkins this month was decidedly technical, so I’ll cover more business, competitive and other matters.
This year/last year
When Calkins and I last spoke 6 months ago, the pandemic was still a big health, IT, personal and corporate concern. And while it remains a major problem in many parts of the world (eg: India), businesses are starting to re-open their facilities in North America.
I asked Calkins to contrast things from our last conversation. He said that:
- While they had lots of deals last year, businesses were ‘reactive’ and hungrily looking for solutions to solve their immediate agility issues
- In contrast, Q1 2021 has seen many more deals and bigger deals, too. CIOs aren’t interested in just doing small deals at the present. The focus is less on survival or immediate adaptation needs but on expanding the business.
Calkins and I discussed all of the other kinds of data that CEOs and board members want to see today (eg: energy consumption, environmental, health, safety, carbon footprint, quality management, etc.) and how poor most ERP solutions are in capturing, reporting and acting on this. Calkins believes that much of the data exists, it’s just that it is ‘inaccessible’. Why? Old software products served and benefited the present and not the needs of the future. I would add that much of that inaccessible data rests in machine tools, electric meters, water gauges, etc. that were never connected to ERP applications and some of that inaccessible data needs other data (eg: time of day that electricity is being consumed) to make the information actually useful and actionable. Those are challenges ERP vendors haven’t risen to.
Actually, I think he’s being kind re: ERP, as the maturity of ERP solutions is such that most only deal with those business transactions that exist within the four walls of the enterprise and often trigger an accounting entry. Most anything else is ignored. Yes, many ERP products now have solutions that touch suppliers, customers and jobseekers but the ‘user’ is almost always an internal user – the exception being the rare portal access some of these constituents get to utilize. And, don’t forget that a portal is only a view into something. If a customer, supplier, etc. actually wants to do more than view status, they can often be disappointed with the lack of functionality in these (dare I say it) ‘systems’.
Calkins believes that it’s because of these factors that Appian is seeing increased demand for its automation and low-code tools.
Calkins indicates that old applications and new tools, like Appian’s, work ‘better together’. He added that workflow automation and/or low code tools close a number of information voids. We discussed how a number of these software voids exist in vertical applications, across different constituencies (e.g., customers, suppliers, regulators, etc.) and now in back-to-the-office post-pandemic needs. Businesses just don’t have the time to wait on software vendors to close/fill these gaps. Moreover, some of those gaps may never get filled by software vendors as the gaps exist:
- Between different vendors’ suites/products.
- Between different work locations.
- Across multiple constituents.
For some package software vendors, these gaps are either too small or lack enough economic upside for them to close. However, the gaps represent major pain points for the firms that must live with them. These gaps can be costly, cause errors, trigger latency in decision making and discovery, and, frustrate those dependent on the outcome.
Waiting on IT or vendors to close these gaps may not be viable as these needs may not be a high priority item for IT or a vendor. So, low-code is looking pretty good these days.
Here’s a low-code example where financial data from several different sources is captured on a single screen. What’s also noteworthy is that the same app can display the data on a mobile or other device without re-coding.
Concurrent with the user conference, Appian also released the results of a study they commissioned on the gap between leaders and laggards in the financial services industry. This excerpt from their press release on the study was interesting:
- “98% of Leaders have gained a "significant competitive edge" from their automation efforts, compared to only 6% of Laggards.
- While the majority of Leaders (70%) have scaled up their use of robotic process automation (RPA), many of the Mainstream respondents (44%) are stuck in the pilot phase of implementation.
- Leaders have an enterprise-wide automation strategy and center of excellence (at least 96%), while Laggards struggle to prioritize automation projects (81%).
- There is no single route to automation excellence. Instead, leading firms demonstrate an ability to seamlessly integrate people, AI, RPA, workflows, databases and systems. Orchestration across a unified workflow lies behind most of the benefits to customers and employees seen in the survey, alongside supporting risk management, compliance, change management, and business strategy.”
Beyond the large swings in results between Leaders and Laggards, the other key factor that caught my attention was the last point. We are at a stage in business and business technology evolution where we must rethink how work is done and do so in less of a rigid, unchanging, one-size-fits-all, time-consuming fashion. It’s simply not enough to get the work done and done correctly. Businesses must get it done correctly the first time, every time. Processes must work at a speed that is measured in seconds not accounting periods. All of the non-value-added and low-value-added work steps, especially those that go beyond the boundaries of an ERP should be obliterated if a company is to remain competitively relevant.
I worry a lot about firms that are re-automating or re-platforming their ERP while their business practices and processes will likely be little changed. That’s a wasted opportunity and bad for the company. It’s also bad for those outside the company (e.g., suppliers), too. The problem is even more acute in firms where internal turf wars are preventing the rapid re-imagination of work. As obvious as this is, holding on to old processes, workflows and systems is damaging to a firm and can create adverse employment situations for those in the firm. Change is not something we can simply choose to ignore. It’s coming whether you want it to or not.
Appian also announced the newest version of its low-code platform. According to Appian:
Appian delivers complete automation, orchestrating people, existing systems, data, bots, and AI in a single workflow. Complete automation fuels enterprise-wide workflows to unlock material business results.
That same press release detailed how the platform connects all manner of applications and data sources and let’s users visually see and extend the data relationships. It also possesses OCR capabilities to pull data out of documents. There’s also an RPA management tool that monitors Appian’s and other bots that impact work processes. And, of course, there is low-code support for DevSecOps.
ERP vendors are starting to realize the market is changing have made some deals to acquire process automation technologies. Unfortunately, their approach to filling the white space out there is troubled. Their efforts to bring more decision data together conflicts with the way they price products. To these vendors, every connection point, every workflow, every document scanned, etc. is a revenue generation opportunity for the vendor. The toll charges, access fees, document storage fees, etc. make some of these ERP-backed solutions the most expensive products out there for solving the new world of work’s problems.
I’m not sure some of those ERP toolsets are as broad as Appian’s either and while ERP vendors claim their technology can connect to all manner of IoT and other devices, you still might need a small army of integrators to make it a reality. By the way, Appian’s guaranteeing you can get your first project done in 8 weeks under a fixed fee.
This space is an interesting one as it provides a real window into where work is and isn’t valued. We all need to watch this evolve….