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State of the Document Management Solution Provider Industry
The document analyzes the state of the document management service providers industry in 2010, highlighting a 9.7% revenue increase from 2009 and that 79% of surveyed companies reported profitability. It discusses the evolution of capture competency among AIIM users, with over 50% at an early stage and only 16% actively extracting data from images to drive processes. Key industry drivers include healthcare as a growth market and a focus on service quality when outsourcing.
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State of the Document Management Solution Provider Industry
- 1. State of the Document Management Service Providers Industry -‐-‐ 2010 Available on SlideShare.net – search on jmancini77
- 2. … or 15 things the survey said
- 3. … plus a bonus speculaFon on the future …
- 4.
- 5. 2010 – BeIer or Worse? What’s in the Head of Your Customers? What’s in YOUR Head? Where is the ECM Industry Headed? Photo source = hIp://www.flickr.com/photos/mcfarlandmo/3274597033/
- 6. 2010 – BeIer or Worse? Photo source = hIp://www.flickr.com/photos/mcfarlandmo/3274597033/
- 7. 85 Survey Par,cipants Other $250 million in revs 4% VAR 20% Sys Int Service 12% Company 64%
- 8. 2010 est revenues(in 000s) 20,000 15,000 10,000 5,000 0
- 10. Staffing • Mean staff size = 87.7 • Median staff size = 14.0 • Mean rev/employee = $113,578 • Median rev/employee = $85,833 • Mean sales staff size = 4.6 • Median sales staff size = 2.0
- 11. • As a percentage of total revenues… • N=33 – Key raFons 2010 2009 – Variable Selling expense 10.2% 7.5% – Personnel expense 35.2% 31.8% – Semi-‐fixed expense 9.8% 8.8% – Fixed expense 13.1% 8.9% Variable Selling Expense -‐-‐ expenses incurred which can be Fed back to a sales event. ParFcularly, sales commissions and customer goodwill accommodaFons. Personnel Expense -‐-‐ expenses that are incurred in payment of employee compensaFon, taxes or benefits. Semi-‐fixed Expenses -‐-‐ normal overhead expenses that may shrink or grow in relaFon to the volume of business but are not Fed to a specific sales event. Examples would include adverFsing, telephone, and office supplies. Semi-‐fixed Expenses -‐-‐ normal overhead expenses that may shrink or grow in relaFon to the volume of business but are not Fed to a specific sales event. Examples would include adverFsing, telephone, and office supplies.
- 12. 2010 2009 Selling, General and 27.3% 27.2% AdministraFve Expense (mean) (mean) 28.0% 25.0% (SG&A %) (median) (median) Gross Margin % 31.8% 30.6% (mean) (mean) 35.0% 30.0% (median) (median) N=37 N=40
- 13. HERE is where I will summarize the highlights.
- 14. 1. Aggregate revenues up 9.7% vs. 2009 Revenues 2009 = -2.2% 2010 = +9.7% 3272 3199 3510 1344 1400 1422 Mean Median
- 15. 2. 79% of companies surveyed profitable based on 85 reporFng companies Total aggregate revenues of $250 million
- 16. 2010 – BeIer or Worse? What’s in the Head of Your Customers? Photo source = hIp://www.flickr.com/photos/mcfarlandmo/3274597033/
- 17. 3. Over 50% of AIIM users surveyed at early stage of capture competency 3% -‐-‐ We don’t scan anything. 15% -‐ We use scanners, but ECM –n organized way. A Short History of not in a The Early Days 34% -‐-‐ We scan as image only/manually apply metadata. 15% -‐-‐ We scan/capture metadata for archive/rou,ng. 17% -‐-‐ We scan and OCR for full text search. 17
- 18. 4. Only 16% acFvely extracFng data from images to drive processes 3% -‐-‐ We don’t scan anything. 16% 15% -‐ We use scanners, but ECM –n organized way. A Short History of not in a The Early Days 34% -‐-‐ We scan as image only/manually apply metadata. 15% -‐-‐ We scan/capture metadata for archive/rou,ng. 17% -‐-‐ We scan and OCR for full text search. 18
- 19. 5. Decision makers vary significantly based on focus of implementaFon Who Makes the Decision? (where primary decision-‐maker known) RM or IT Line of compliance Business Capture 15% 23% 29% ECM & RM & 24% 34% 14% DM Workflow & 10% 31% 27% BPM SharePoint 8% 68% 6%
- 20. XX% -‐-‐ Con,nuity/disaster recovery XX% -‐-‐ Records and compliance XX% -‐-‐ Improve process throughput XX% -‐-‐ Short Hcustomer f ECM – The Early Days A Improve istory oservice/access XX% -‐-‐ Reduce paper/go green XX% -‐-‐ Reduce transporta,on/logis,cs costs XX% -‐-‐ Improve informa,on access/KM XX% -‐-‐ Reduce physical office costs XX% -‐-‐ Increase flexibility XX% -‐-‐ Reduce data entry costs 20
- 21. 6. Top business drivers for capture clear, but not necessarily consistent 15% -‐-‐ Con,nuity/disaster recovery 39% -‐-‐ Records and compliance 43% -‐-‐ Improve process throughput 41% -‐-‐ Short History oservice/access Early Days A Improve customer f ECM – The 26% -‐-‐ Reduce paper/go green 17% -‐-‐ Reduce transporta,on/logis,cs costs 53% -‐-‐ Improve informa,on access/KM 43% -‐-‐ Reduce physical office costs 06% -‐-‐ Increase flexibility 13% -‐-‐ Reduce data entry costs 21
- 22. 7. Users value cost benefits of capture outsourcing most; but not as much as suppliers think they do 8. Service companies under-‐esFmate the value users place on smoothing workflow spikes Key Capture Outsource Benefits (name 2) Easier migraFon Improve security Increase flexibility Improve quality Reduce expense Handle "spikes" Conserve mgmt Fme Focus personnel
- 23. 9. End users look to AIIM and local events as most favored sources of informaFon on capture and scanning soluFons; soluFon providers tend to over-‐value their own email markeFng and large verFcal events and under-‐invest in press (and frankly in AIIM)
- 24. 2010 – BeIer or Worse? What’s in the Head of Your Customers? What’s in YOUR Head? Photo source = hIp://www.flickr.com/photos/mcfarlandmo/3274597033/
- 25. based on 85 reporFng companies Total aggregate revenues of $250M
- 26. 10. Healthcare clearly perceived as THE key growth market; S&L currently the largest exisFng market, but likely subject to pressures in next few years Your top 3 growth markets? 76% = healthcare 33% = state and local 28% = banking 26% = oil and gas/uFl 21% = fed govt based on 85 reporFng companies Total aggregate revenues of $250M
- 27. 11. % experiencing revenue growth for professional services, scanning services, and sosware sales up significantly in 2010 over 2009 Business Mix Revenues up Revenues same Revenues down Last 12 months Last 12 months Last 12 months Micrographic HW 1% 75% 23% Scanning HW 30% 45% 26% Micrographic serv 5% 65% 29% Scanning serv 43% 28% 29% Professional serv 61% 26% 12% DM and ECM SW 49% 32% 19% Sosware Dev 26% 70% 4%
- 28. 12. When service companies themselves outsource to a partner, THE most important characterisFc in a partner is service quality. Core quali,es in an outsourcing partner -‐-‐ name 2 Responsiveness 35% Security 15% Service quality 81% Experience 24% CompeFtor? 24%
- 29. 13. When service companies themselves outsource to a partner, the most likely processes are film-‐related and indexing
- 30. 14. Top on the wish list of desired support for vendor partners are: a) joint sales calls; and b) pricing flexibility
- 31. 15. Top on the wish list of aIributes for scanning/capture partners are: a) price; and b) reputaFon
- 32. 2010 – BeIer or Worse? What’s in the Head of Your Customers? What’s in YOUR Head? Where is the ECM Industry Headed? Photo source = hIp://www.flickr.com/photos/mcfarlandmo/3274597033/
- 33. Understanding markets in transi,on 33 Photo source = hIp://www.flickr.com/photos/ellenm1/3861396678/
- 34.
- 35. AIIM Task Force Understanding Markets in Transi,on For more informaFon -‐-‐ hIp://www.aiim.org/futurehistory 35
- 36. Image source = hIp://www.direcFmpactnow.com/ 36
- 37. Consumer Technologies and the Enterprise You Say You Want a Revolu,on Enterprise IT Consumer IT On Hold On Fire Source = AIIM and TCG Advisors 37
- 38. How can it be that I am so powerful as a consumer and so The Big Disconnect lame as an employee? How disrup,ve will Consumer IT be to Enterprise IT? Source = AIIM and TCG Advisors
- 39. Systems of Record Systems of Engagement Command and control CollaboraFve Systems of Engagement Emerge TransacFon-‐oriented InteracFon-‐oriented Document-‐centric User-‐centric User learns system System learns user Security is key issue Privacy is key issue Source = AIIM and TCG Advisors 39
- 40. 1. Aggregate revenues up 9.7% vs. 2009 10. Healthcare clearly perceived as THE key 2. 79% of companies surveyed profitable growth market; S&L currently the 3. Over 50% of AIIM users surveyed at largest exisFng market, but likely subject early stage of capture competency to pressures in next few years 4. Only 16% acFvely extracFng data from 11. % experiencing revenue growth for professional services, scanning services, images to drive processes and sosware sales up significantly in 5. Decision makers vary significantly based 2010 over 2009 on focus of implementaFon 12. When service companies themselves 6. Top business drivers for capture clear, outsource to a partner, THE most but not necessarily consistent important characterisFc in a partner is 7. Users value cost benefits of capture service quality; top processes film-‐ outsourcing most; but not as much as related and indexing suppliers think they do 13. When service companies themselves 8. Service companies under-‐esFmate the outsource to a partner, the most likely value users place on smoothing processes are film-‐related and indexing workflow spikes 14. Top on the wish list of desired support 9. End users look to AIIM and local events for vendor partners are: a) joint sales as most favored sources of informaFon calls; and b) pricing flexibility on capture and scanning soluFons; 15. Top on the wish list of aIributes for soluFon providers tend to over-‐value scanning/capture partners are: a) price; their own email markeFng and large and b) reputaFon verFcal events and under-‐invest in press (and frankly in AIIM)