CM: THE NEXT GENERATION of ALM is on Our Doorstep

To start with, companies are downsizing.  Large, expensive CM/ALM systems are adding to the pressure not only to keep the bottom line in the black, but to keep companies afloat. The total cost of operation for CM/ALM systems, which can be quite significant, will not be justified by the technical need when there are other, less costly, and in some cases more capable, solutions out there, and when there are more pressing financial needs.  So the shift from big-IT will start in earnest this year.  CM/ALM will only be one segment of big-IT affected.  Watch for SAP and Oracle to be hit hard.  Off-site training and conferences will be hit hard, with a move to put more on-line.

2009: An Opportunity for CM/ALM Industry

Nevertheless, the CM/ALM industry will prosper, as companies look at how they can reduce costs.  The proof of reducing operational costs will have to be there, up front, before anyone commits to new capital purchases however.  For that reason, much of the CM/ALM industry action will involve companies migrating from existing costly solutions, including big-IT CM/ALM solutions, to more lean solutions.  This is the real beginning of the 3rd Generation of CM.

How will this happen?  Organizations will begin to look at their costs, and then their IT costs, and then their CM/ALM costs.  Typically these involve:

• New license acquisitions (not much of that this year with falling employment)
• Annual maintenance/support fees
• New Release Upgrade Fees
• CM/ALM System Administration Costs
• CM/ALM Process/Tool Customization Costs
• CM/ALM Training Costs
• Glue development and maintenance costs for tool integration
• Cost of supporting infrastructure, such as databases and hardware, including cost of operation.
• Cost of down-time/outages, recovery, backups (especially as teams become lean)
• The capability for productivity improvements for developers, managers, CM Managers, Project and Product Managers, etc.
• The ability to make good, accurate decisions based on up-to-date information, to avoid rework, vaporware, etc.

For some vendors, this will be a real challenge.  IBM is a service company.  Will they be able to adjust to the changing CM/ALM market?  For other vendors, this is a real opportunity to entice prospects using competitive solutions to test drive their own.  These vendors will have to have something to offer that can deal with the requirements of these prospects at a lower cost of operation, and even after factoring in the cost of new licenses.

On the other side of the economic fence is a significant wild card.  As governments attempt to stimulate the economy, how much will they loosen their purse strings?  2009 could see the biggest push from defense, aerospace and other government and government-contracted organizations to improve their operational processes, as the coffers swell from stimulus efforts.  It's a great opportunity for government to build and/or upgrade its IT infrastructure, and CM/ALM is a significant part of that infrastructure, especially where process improvement is needed.

And the wild card extends to industry, at least to those organizations that have to come to grips with being more competitive.  As stimulus programs are unveiled, there will be requirements for significant structural improvements attached.  So the automotive and aerospace industries could easily be looking to realize process improvement.  They may look to proven process improvement methods such as Six Sigma and to a lesser extent CM II, as well as to more generic process improvement methodologies/monitors, such as CMMI.  An interesting note about CM II is that this fall, the ICM (Institute of Configuration Management) officially launched a rebranding effort to cover not only traditional CM, but also the wider set of enterprise processes.

The Proof is in the Pudding
Now with all of