Tuesday, November 4, 2014

BMC Engage2014 – it’s a whole new game!

By Rich Ptak
BMC Engage 2014 is a customer-oriented event. This year it included an analyst event, the first under the new owners, so interest was high. Also, it’s been a year since BMC went private with private equity sponsors led by Bain Capital and Golden Gate Capital. We’d been briefed and written about BMC and new products[1] several times over the last year. Now we had the opportunity for close-up discussions with executives from CEO, Board Chairman Bob Beauchamp on down. The event also provides a platform for customers, executives and operations staff, to speak frankly about their experiences with BMC products. Their stories contained a lot of very good news for BMC. We came away impressed with the changes made, the BMC sponsors’ investment decisions and optimistic about BMC’s future. Here’s why.                  

BMC has reshaped itself over the past year. It has a new logo, updated strategy, messaging focused on user experience, and aggressive marketing for an expanded solutions set. All supported by a reorganized, extended executive management team with some new players. It is organized into the following solution areas: Cloud and Data Center Automation, Performance and Availability, Service Support, Workload Automation, and ZSolutions and Select Technologies.

The team’s focus is on innovation in IT solutions and services targeted to provide an exceptional user experience. All devoted to enabling customers’ success in ‘Digital Business’. A new organization under the direction of a Chief Customer Officer will help maintain focus on the customer. It will coordinate and be responsible across-BMC products and services for efforts directed at assuring (and verifying) customer success as well as customer focused product improvement e.g. the new user interface.

All of these changes are reflected in BMC’s “Living IT[2]” strategic initiative. The message is clear. In today’s Digital Economy, IT is fundamental and necessary to the success of the business whatever the market being served. As BMC puts it, they will create and deliver a completely “new technology experience for employees and IT managers through smart, next-generation social and collaboration tools that enhance productivity, simplify administrative tasks and enable digital services that directly engage customers, partners and stakeholders.”

BMC is focusing on the important fundamentals which include verifying customer achievement of their identified needs. There are three things customer CTO and IT organizations need to succeed where BMC can help. These are: 
  1. Ability to quickly deliver infrastructure solutions;
  2. Ability for high-speed innovation in creating solutions;
  3. Industrial-strength (industrialized) solutions to help them operate effectively.

BMC is committed to providing all three. Using existing and expanding expertise in technological innovation, BMC will deliver the products, services and solutions necessary to make that happen. 

Four consolidated product/solution areas support this new positioning:
  1. BMC Remedy with Smart IT – an ITSM solution providing “an intelligent, mobile, and beautiful” [3] user experience enabling the application of mobile and social technologies to improve service delivery and intuitive access to technology across the enterprise. (Look for the new UI here!)
  2. BMC TrueSight – a new product family, TrueSight combines multiple BMC performance and availability products with new IT analytics capabilities to optimize service levels, reduce ownership costs and improve IT productivity, while improving the employees’ experience. (Easier to use technology!)
  3. Smartflow Solutions – a new family of industrial-grade, integrated solutions built on BMC products to combine the power of multiple (including non-BMC) management applications that allows IT to simplify complex tasks and exploit new relationships between teams, systems, and information. (BMC makes a smart commitment focused on strengthening ITOM integration within its own portfolio and in support of mixed vendor solutions here.)
  4. Automation Passport – a new automation framework derived from best practices across more than 1,000 BMC automation customers. The framework offers tools to develop custom automation roadmaps, guidelines to maximize automation value, and access to BMC’s new Automation Center of Excellence laboratory. (This looks to us like a really valuable customer asset. Watch for our more detailed comments coming up.)

In addition, the ZSolutions business group is using a significant part of the sponsors’ increased investment to enhance and expand their offerings. We’ve written about the R4 products (see footnote 1 above). This group of products, announced during the last year, focus specifically on automating the reduction of software licensing costs. Customers have seen savings of up to 20% in some licensing costs.

All of these (and more) were topics of discussion and presentation during the recent event. The impression left is of a better capitalized, more focused and energized company increasing its level of competition and success in well-defined, targeted market segments.

Part of the impetus behind BMC’s clearly evident confidence and energy are a series of actions by the BMC sponsors; actions that are clearly demonstrating they saw in BMC a business with significant potential for profitable growth and return on investment. The evidence includes the infusion of significant additional investment, much of it directed to long-term investments in R&D to add and build-out products, as well as spending to increase market presence and visibility. Incidentally, this belief in BMC, its management team, product portfolio and revenue potential is in the process of being validated by financial performance that so far this fiscal year[4]  has exceeded all the committed benchmark metrics.

Another major impetus comes from BMC’s own history of commitment to identifying, understanding and solving their customers’ operational and administrative challenges. Early on, BMC’s focus was on providing tools and solutions that were simple to implement and use while delivering prompt returns as they facilitated monitoring, management and administrative tasks for both mainframe and distributed systems. They were among the earliest innovators at consolidating tools into integrated solutions. Because their solutions were focused on ‘back-end’ and infrastructure problems, Line-of-Business and financial managers didn’t easily understand their business justification. BMC stepped up to help their technology savvy consumers to justify purchases in terms of business contributions. They have been at the forefront of efforts to automate IT infrastructure operations and management.

All this contributes and pays tribute to their proven ability to comprehend and respond to the needs of their target customers. And, this ability becomes especially important as demand escalates for productivity and speed of response even as consumers of technology become less technical in a world that is increasingly mobile, technologically complex and rapidly evolving.

We’ll have more to say after we’ve had some time to review the Automation Passport and other areas. It is no surprise to us to see BMC focusing on solutions to make the power of digitalized technology more accessible to and easily consumable by both IT and business customers.

Bob Beauchamp, CEO, indicated one of the real advantages of being a private company was that they now have the ability to invest in projects that will take more time to realize a return but will yield a very significantly greater payback when completed.

However those investments turn out, it was clear from both the customers and BMC that they are seeing some satisfying benefits and financial payback today. We think the next few years will continue to be very interesting and rewarding for BMC and its customers.

[3] These are BMC’s own words!
[4] BMC’s fiscal year begins in April.