One-on-One with BPM Vendor K2’s Executives

In the first part of this report, Technology Evaluation Centers (TEC) zoomed in on the business process management (BPM) vendor K2, focusing on the business strategies and products that have allowed the vendor to become a serious contender in the BPM space. In this second part, TEC recently spoke to the K2’s top executives to get an insider view of the company’s mission and vision for the future.
TEC: Which regions and industry segments have been most active of late? What do you foresee in the next 12 to 18 months—more of the same or not?
K2: We see tremendous growth in departmental solutions across industries—from finance, HR, sales and marketing, to operations, and purchasing. This continues to shift as the business (LoB) places more emphasis on driving the business decisions without IT (ability for the LoB to build apps for themselves as an example). The demands from each of the functional areas of the business are creating more of a need for self-service and access to data/information. From an industry perspective, we are seeing growth in manufacturing, financial services, oil and gas, health care, and the public sector. We are also seeing growth in Asia, Europe, and Latin America increasing in the next 12 to 18 months based on continued growth in our partner ecosystem.
TEC: What are your high-volume analytics (i.e., big data), social, and mobility strategies, and are there any generally available offerings?
K2: We are a consumer of big data and can use data sources to trigger action or to ensure that the right people have the right information when making decisions that affect the business. For example, a trending topic on Twitter can be combined with enterprise resource planning (ERP) and customer relationship management (CRM) data to help a business ensure that pricing decisions are effectively managed in real time. It really is about assembling business apps on top of big data as well as automating the processes that would allow our customers to react and respond to information immediately. K2’s technology called SmartObjects is focused on tapping into data sources in a rich, easy, and intuitive way, and then logically consolidating information from across data sources into things that make sense for businesspeople. We do not currently provide predictive analytics within K2 blackpearl, but do allow for integration with third-party products and will trigger events based upon user-definable rules.
From a social, mobile, and collaboration standpoint, the core of the K2 platform differentiation is that users can collaborate regardless of the environment. Today, K2’s free Mobile Worklist app provides a rich set of capabilities for users involved in K2 processes directly from the mobile device; this includes iOS, Android, and BlackBerry apps as well as Windows 8 preview.
TEC: Are there any evident remaining white spaces (functional gaps, based on customer inquiries and competitive face-offs) in your offering and how do you plan to fill them?
K2: We continue to evolve our current offerings with an agile/Scrum engineering model. Our customer, partner, and developer ecosystem is extremely robust within the forums of K2 Underground, where we are able to keep pulse with our customers; in many instances the ecosystem addresses questions directly. Our technology platform and offerings continue to evolve to meet the business requirements today and in-step with horizon offerings to meet where the market is going (an example is a platform-as-service/software-as-a-service [PaaS/SaaS] model development). We will be sharing further information during our upcoming User Conference in March.
TEC: How do you counter the prospects' mantra ‘Why do we need K2 if we already have SharePoint?’
K2: When a customer asks the question of why K2, there are a few considerations we ask, such as: What are the workflows and processes you need? Are you a developer or a business user? Do you need forms and workflow, how are you reporting on the data, and do you need an automated process? Yes, automated processes can absolutely be created within SharePoint with SharePoint Workflows, InfoPath, SharePoint forms, etc. However, in many cases these tools can be cumbersome and not intuitive for a business user. 
When a customer is looking for a solution to empower business users, or has reached their scalable threshold, or is looking to integrate data outside of SharePoint—that is where K2 comes in. K2’s easy-to-use UI and design tools are intuitive for a non-developer—forms, workflows, and automated processes can be built in minutes by a business user. K2 shines with SharePoint natively in the areas of workflow, forms, and in developing business apps that use SharePoint data (and again, by a business user—you do not have to be a developer to use K2). Companies come to K2’s flagship product K2 blackpearl because it is completely integrated with SharePoint 2010 and 2013. Access to Active Directory and Exchange, SQL Server, and Microsoft Dynamics CRM allows for simple data integration. It also runs independently from SharePoint but extends the customers’ SharePoint investments, and while spanning other enterprise systems, customers can pull data and information across the organization into one single application.
TEC: How do you view the usefulness of BPM in manufacturing ERP environments?
K2: Manufacturers do a lot with ERP (i.e., material requirements planning [MRP], some product lifecycle management [PLM], vendor management, supply chain, etc.) and often invest heavily with large teams that are ready and equipped to build anything within their ERP system. Because so much of a manufacturer’s business is often housed in the ERP system, ERP-entrenched users will often believe that it’s just easier to build it there rather than having to deal with a third-party BPM system that they don’t understand—and they don’t want to deal with the requisite integration required, which can be painful.
We see traction around ERP. A number of our customers are doing this very well and ultimately applying pressure to the ERP team by providing apps that not only meet a functional need but also would be better coupled with data from their ERP system. Additionally, some customers have recognized that it is easier to expose more business capability to more people by exposing the ERP up through workflow, collaboration sites, and/or more user-friendly interfaces. K2 is used to doing that, with ERP becoming a system of record rather than the system of engagement for certain people and functions. ERP systems (such as SAP) are recognizing this as well and attempting to provide a much simpler user experience for more people.
TEC: Where are you in the debate “transformational BPM vs. enabling a few agile processes at a time”?
K2: We do agree that it is important to have an incredibly agile “living” process—both to meet immediate, short-term, and fast return on investment (ROI) for disposable applications. Disposable applications are apps that are built to address a very point-in-time, specific business need—for example, building an app for a conference or event, or a supply chain escalation process fix. There are so many examples of apps that have been built that have immediate ROI for a very specific need and a determined lifespan. The sky is the limit and the cost is so super low to an exponential value/ROI—that is where the magic is. Alternatively, there are business process applications that can achieve immediate ROI while driving a process over the long term within a functional or process area (case management, inventory approvals, time and reporting, etc.) and address the business requirements.
We believe the days of “transformational business process,” which require an army of services consultants and years of design to attain a multi-year ROI/breakeven point are going to become obsolete over time—replaced by the requirement of immediate ROI to the business and a build-and-leverage model with no code, therefore putting the business literally in the driver’s seat.
TEC: What is keeping you up at night, and who/what do you fear the most in the market?
K2: We sit at an incredibly exciting time with the power to provide a greater number of people with the ability to quickly create what they need, when they need it. We are well positioned. That opportunity keeps us up at night.  
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