Progress Software Acquires Savvion

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January 12, 2010 – Middleware provider Progress Software announced the acquisition of business process management suite vendor Savvion Inc. yesterday for $49 million, net of cash acquired.

The combination of Progress Software’s business event processing, business transaction assurance and integration portfolio, and Savvion’s BPM suite is expected to help customers gain a level of operational responsiveness that is a new imperative for business and IT, according to the company release.

Though Progress’s acquisition of Savvion is a reach beyond its market, the middleware vendor is following a recent trend of human, integration and document-centric market-segment consolidation in the BPM suite space, following Software AG’s acquisition of IDS Scheer and IBM’s acquisition of Lombardi.

While enterprises would ideally select a single BPM suite to meet all its needs, products currently lack the maturity to support such a strategy, according to a September Forrester report.  And, market convergence is a step toward meeting client-demand for streamlining.

“A lot of the rationale behind this is that organizations still have specific drivers for their BPM implementation. What they’re finding is when they get their first BPM implementations done, they may need to add on other capabilities,” said Clay Richardson, senior analyst for Forrester in an interview with Connie Moore, a research manager for the market research firm. “These vendors are hearing from their clients that they want richer capabilities. Some have eight or nine products, contracts and relationships to manage. They’re asking ‘How do I streamline down to a core set of three or four products or vendors?’”

Yesterday’s acquisition is likely to create some anxiety for process professionals attempting to gauge the direction of the market, but they are likely to benefit the most, according to Richardson.

“The biggest winner in the acquisitions that we’re seeing is the business process professionals. Both of these acquisitions [IBM/Lombardi and Progress/Savvion] really represent a great shift in business technology toward more emphasis on the business and process professionals at the front of this. They have an opportunity to shine,” said Richardson.

The Progress/Savvion deal is further validation that software vendors are committed to providing better tools and capabilities to support business-led transformation and process improvement initiatives, he added.

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