Magic Quadrant for Integrated Document Management, 2003

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1 Markets, K. Shegda, T. Bell, K. Chin, M. Gilbert, D. Logan Research Note 10 July 2003 Magic Quadrant for Integrated Document Management, 2003 Document management has moved to the forefront of many enterprises' purchasing lists. Our 2003 Magic Quadrant explains the complexities of the integrated document management vendor landscape. Core Topic Knowledge & Content Mgmt., Collaboration & E-Learning: Content, Media and Publishing Key Issue Which vendors will provide critical support in content, media or document management? Strategic Planning Assumptions By year-end 2005, more than 50 percent of the remaining IDM vendors will offer a majority of comprehensive content management capabilities (0.8 probability). By 2005, there will be few specialist vendors of IDM or WCM functions, with most offering both sets of functions and varying degrees of integration (0.9 probability). By 2005, enterprises will establish content infrastructures to support key business applications and processes, and to manage the rapid growth of unstructured content (0.7 probability) The integrated document management (IDM) market has matured and stratified. The definition of IDM has expanded beyond core library services to include imaging and workflow as well as records management, enterprise report management/computer output to laserdisc, collaboration and Web content management (WCM). Reflecting these changes, we have re-examined the Ability to Execute and Completeness of Vision axes on our IDM Magic Quadrant. A broad range of functionality was considered, although core IDM capabilities were weighted heavily in the evaluation. Several powerful trends continue to shape the IDM market. The worst of the economic slowdown has passed and new government regulations and business requirements make enterprises more willing to undertake document management, imaging and records management projects. New regulations demand better recordkeeping, and heightened security concerns lead some firms to handle mail in isolated facilities and to forward documents to business units electronically. Key trends include: An enterprise focus on suites that combine former best-ofbreed components, such as document management, WCM, records management, workflow, imaging and collaboration. Several vendors now bundle them into more-seamless products. This approach should reduce costs, simplify acquisitions and reduce integration complexities. The WCM and IDM markets continue to merge. By 2005, there will be few specialist vendors of IDM or WCM functions, with most offering both sets of functions and varying degrees of integration (0.9 probability). A number of IDM vendors will tie enterprise resource planning (ERP), customer relationship management, IDM Gartner Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice.

2 and portals together for a comprehensive and collaborative information center. Corporate accounting scandals and subsequent reforms are driving enterprises to implement records management and reporting to meet regulatory compliance initiatives. Some vendors are fusing vertical-industry content and support for business processes. Many enterprises adopted IDM in specific areas or for specific processes, but they never scaled up to enterprisewide deployments. When the time came to do so, they found the business case to be less clear, and the functionality points and cost to be too high. High-end IDM vendors have failed to offer lower levels of functionality and cost to wider audiences. Certain classes of document management applications can easily be justified, but other business cases are more difficult to prove. A well-designed and effectively implemented IDM application can save time, decrease process latency, increase efficiency, help streamline processes and decrease the risk associated with lost documents (see "Document Management: Assessing Costs and Benefits"). It can also help teams and remote workers contribute content and collaborate. Document management software license revenue has a total market value of $1 billion worldwide. Revenue growth continued to falter in 2002 due to continued macroeconomic weakness. The 2003 IDM Magic Quadrant includes vendors in three quadrants: Leaders, Visionaries and Niche Players (see Figure 1). 10 July

3 Figure 1 The 2003 IDM Magic Quadrant Challengers Leaders Ability to Execute Open Text IBM/Lotus Hummingbird Mobius Tower Stellent Microsoft IXOS imanage Gauss Optika Hyland Software Xerox Identitech FileNet Documentum Cimage Spescom Westbrook Ringwood OIT Tower Software Meridio Legato As of June 2003 Niche Players Visionaries Completeness of Vision Legend Cimage Gauss IXOS Legato Mobius OIT Ringwood Spescom Tower Westbrook Cimage NovaSoft Gauss Interprise IXOS Software Legato Systems Mobius Management Systems Optical Imaging Technology Ringwood Software Spescom Software Tower Technology Westbrook Technologies Please note that Tower Software and Tower Technology are two separate companies. Source: Gartner Research (June 2003) Leaders Documentum is one of the long-time leading IDM vendors. The company continues to demonstrate the ability to anticipate market shifts and adapt in response to them. To further extend its broad content management capabilities and build out its product portfolio, Documentum made two strategic acquisitions: collaboration vendor eroom and records management vendor TrueArc. Its strengths are in scalability, compound document management and comprehensive content management, as well as a focus on regulated industries. Its primary challenges are to maintain its focus and reduce the high costs associated with the 10 July

4 implementation and maintenance of the software; and to continue with the technical changes necessary for making the product set easier to implement and change. FileNet's roots are in high-volume production imaging and workflow, where it is a recognized leader. This vendor has demonstrated market vision by extending its IDM functionality outside imaging by adding enterprise application integration, business process management and WCM. With the introduction of P8, FileNet is embracing the Java and.net architectures. In P8 and its packaged suite approach to content management, FileNet has begun to cohesively address content life cycle management. FileNet's strengths include its scalable architecture, related technology expertise, vertical application focus and the ability to integrate with other applications. As IDM becomes a commodity, FileNet must justify its cost and complexity. It must also shift its revenue balance away from imaging and a dependence on services. Open Text continues to augment Livelink's core capabilities and drive it further into a suite that combines collaboration, portals and content management. Its most recent move in that direction was the acquisition of portal vendor Corechange. Open Text was an early adopter of the Web-based IDM and collaboration model and has stayed true to its vision of supporting enterprise knowledge management. A clear market vision and resistance to fashionable marketing labels are its major strengths. Its offerings cost somewhat less than those of FileNet and Documentum. It maintains a comprehensive set of core content management functionality, including imaging and records management. A recognized strength is a short implementation cycle, which is often mentioned as a benefit by customers. Challenges include a broad array of competitors inside and outside the IDM market. Hummingbird's strengths include integration between its related portal, collaboration and business intelligence tools, as well as good integration with Microsoft Exchange and Lotus Notes. Low cost of deployment and a focus on records management are also strengths. Recently, Hummingbird has moved to create a coherent brand and product structure that encompass content and document management, collaboration and information access. Its current strategy emphasizes document management as a core component of its enterprise information management strategy. Challenges Hummingbird faces include moving to a single, tightly integrated suite, moving away from its Microsoftcentric platform to Java 2 Platform, Enterprise Edition, and addressing its limited workflow capabilities. IBM/Lotus has long been a strong vendor of document imaging, integrated document archive and retrieval system (IDARS) and 10 July

5 workflow technology, with one of the largest installed bases of any IDM vendor (more than 9,000 systems). IBM s strengths include its breadth of platform support, professional service capabilities and global presence. Recently, IBM has shown a strong vision for comprehensive content management, bringing together the Lotus, WebSphere, DB2 and IBM Content Manager offerings into a conceptual suite, along with records management. IBM s vision for enterprise content management also addresses the overlapping functionality (core library services) of IBM Content Manager and Domino.Doc. Its challenge is to move to a more-cohesive suite, with a single repository for documents, collaborative content and print stream data. Its products are loosely coupled point solutions that rely on middleware and professional services for integration. Visionaries Stellent has strong publishing and WCM capabilities. The company must improve its visibility as an IDM player after having devoted much of its focus to the WCM market. It has broad platform support and proven scalability. It also offers "good enough" functionality relative to imaging and workflow and light IDARS capability. imanage has been strong in the legal sector, and it now focuses on financial services, manufacturing and government. Functionally, it has adopted the collaborative approach to IDM. imanage's strengths include quick deployment times, ease of use, tight integration with Microsoft Outlook and collaborative functionality. Growth in other vertical markets needs to continue. Tower Technology is a leader in production imaging, particularly in high-volume transaction environments. It provides solid functionality and scalability. Its government client base is strong in Europe and growing in the United States. Tower Technology's challenge is to strengthen its visibility and its ability to execute in the United States. Hyland Software focuses solely on the IDM market, with a lowcost, yet comprehensive, suite. Key strengths include providing integrated functionality in a Microsoft environment, an attractive initial price, low total cost of ownership and ease of deployment. Challenges are to build credibility with enterprises and to expand its global presence and services capabilities. Challengers There are no challengers in this Magic Quadrant. This reflects the maturity of the IDM market few new entrants, consolidation, and shifts in the development, architecture and 10 July

6 marketing directions for the former challengers. The lack of challengers also reflects a real gap in the market between the high-end vendors that focus on enterprise implementations and the niche vendors that have traditionally targeted departmental implementations and are risky in terms of long-term viability. For small to midsize enterprises, there are no strong, viable solutions that provide the ease of use/deployment and low cost of niche solutions combined with the robust functionality of a leader. Niche Players Many of the niche vendors offer imaging, workflow and IDARS, in addition to document management. In this Magic Quadrant, Optical Imaging Technology (OIT), Identitech, Legato Systems and Westbrook Technologies fall into that category. These vendors and their products are increasingly viewed as low-cost alternatives to imaging products from IBM and FileNet, and they have generated interest from enterprises focused on cost savings. Others are vertical specialists such as Spescom Software, Cimage NovaSoft and Ringwood Software. Cimage and Spescom focus on IDM, primarily in industries with extensive infrastructures that undergo constant change throughout their life cycles, including utilities, energy, transportation and government. Ringwood enables enterprises to put large technical documents online with core library service capabilities. Tower Software offers core library services in conjunction with records management. Meridio, an IDM and records management vendor with a repository-only product, is gaining popularity in the United Kingdom and elsewhere through a bolt-on Microsoft-centric strategy and tight integration with SharePoint Portal Server. In addition, IXOS Software and Mobius Management Systems are two newcomers to the IDM market; both have made strategic acquisitions that have given them core IDM capabilities. However, neither has gained enough presence to be considered a challenger in this space. Although both vendors are strong in pure imaging and archiving and show vision for moving toward comprehensive content management solutions, their document and content management and workflow components are new and unproven. Microsoft's SharePoint Portal Server offers out-of-the-box functionality, ease of use and search capabilities, but it is platform-dependent and has limited scalability. Microsoft must prove that the functional improvements it is planning for v.2 translate into much better performance. Microsoft must also rationalize the integration between SharePoint and its Web content management server, CMS Microsoft has been slow in responding to the trend of tying together document management, WCM and portals. 10 July

7 Gauss Interprise has strong content management capability with IDM functionality, IDARS and WCM, in addition to ERP integration and broad platform support. It has appeared on enterprise shortlists from a variety of perspectives: IDM, WCM, IDARS and imaging. Gauss must increase its presence in North America. IXOS is moving from SAP archiving to the broader content management market through its acquisitions of Obtree and PowerWork. Vendor strengths include a global presence, large installed base, and strong partnerships with Accenture, EMC, SAP and Siebel Systems. However, it must prove it can make the transition to a broader identity. Since early 2001, Mobius has acquired or built workflow, document management, WCM, digital asset management and records management capabilities into its product suite. The vendor must demonstrate that it is as adept at providing solutions in these areas as it is within its traditional IDARS space. Optika has made substantial improvements in IDM and enterprise content management, especially with records management, core library services and ERP integration. Optika must continue to build out its product suite and sustain profitability. Xerox's DocuShare has progressed from an application that was developed for internal use to a collaborative document management tool. Designed for ease of use, ease of implementation and low cost of ownership, DocuShare has gained a foothold in the small to midsize business market. DocuShare is scalable and open, but it lacks market presence and channel capabilities. Acronym Key ERP IDARS IDM OIT WCM enterprise resource planning integrated document archive and retrieval system integrated document management Optical Imaging Technology Web content management Bottom Line: Enterprises will increasingly turn to vendors that offer an array of comprehensive content management capabilities, including integrated document management, imaging, workflow, integrated document archive and retrieval system, records management, Web content management and digital asset management support. By year-end 2005, more than 50 percent of the remaining IDM vendors will offer a majority of comprehensive content management capabilities (0.8 probability). 10 July