Start-up greases wheels of business

Start-up Intalio will next week debut new software to help automate business processes, entering a market segment that is poised for growth, according to analysts.

The company, one of a handful of business process management (BPM) software specialists, has developed software to model and build programs to automate complex processes such as product manufacturing and acquisition of raw materials. BPM software includes tools to model and build systems and to link these to existing databases and other business applications.

Intalio's product, called Intalio N3, or "N cubed," consists of application development tools and a server that executes programs through different stages of a multistep business process. For example, one of the company's two customers, Lexis-Nexis, is using Intalio N3 to create information services for small and medium-sized businesses that draw on data from multiple sources.

Business process management is fast becoming a hotly contested software category, said analysts. BPM products can help corporations integrate their existing data and applications into new business systems. Software companies claim that BPM software allows customers to more quickly react to changing market conditions by using process models to design and build more flexible applications.

But BPM software doesn't come cheap. However, despite generally stingy IT spending, analysts are bullish on the prospects for BPM software. In a survey of 200 organizations last year, the Delphi Group found that a majority of those companies planning BPM projects expected to spend between $100,000 and $500,000. IT research firm the Delphi Group expects that the global BPM market to top $5 billion in 2004.

Part of what's driving the interest in BPM is a growing focus on streamlining business processes to ultimately save money, said Benoit Gaucherin, chief technology officer at systems integration and consulting company Sapient.

He said that business people have yet to embrace business-modeling tools in a significant way, but he does see usage growing.

Intalio, which built its product around the idea of integrating applications and modeling business processes, represents one of several companies in the BPM market. The company and fellow BPM software makers Fuego and Savvion argue that they are ahead in terms of technology development, yet they face competition from a host of other software providers.

In a December 2002 ranking of BPM companies, Forrester Research placed Intalio within the "strong performers" category, but noted that there are no clear leaders yet in the market.

Software workflow companies, which historically built systems for document management, have beefed up their products with better application integration. Integration middleware companies have added modeling and development tools for BPM. And application server companies such as IBM, BEA Systems and Microsoft also have products that fit into the category.

Version 2 of Intalio N3 introduces a programming application for building Web front-ends to business applications, a more robust server with added support for clustering, and better connectivity to packaged enterprise applications. The upgrade also allows companies to use a modeled business process in more than one application development project.