Automation Anywhere buying FortressIQ is a less-than-exciting combination. It seems like too little too late for AA to jump into the process mining/intelligence world, and a quick cash-out for FortressIQ Founder, Pankaj Chowdhry, who just wanted out and was running out of time and money – and losing all hope of an eventual acquisition by Microsoft. RPA and process mining are different beasts and not one where the process intelligence market leader Celonis has successfully (or intentionally) combined, and where UiPath, the RPA market leader, has struggled, with its acquisition of ProcessGold. So what makes AA and FortressIQ think they can succeed where many others have failed? Is this what the market demands? Do these firms really understand who their customer is?
So let’s weigh up how these offerings fit together and whether this merger has any real potential.
The acquisition seems like a Hail Mary for both firms
Automation Anywhere just announced its acquisition of process intelligence vendor, FortressIQ. In their statement, the software firms pledge to “build the automated company, together”. But in that declaration lies our first impressions of the limiting potential of this combination. The acquisition feels like a knee-jerk reaction to the current market trend of using user activity data to find, measure, and monitor RPA opportunities. In HFS’ view, the use of enterprise process data can be far more impactful and address larger change programs as businesses push towards digital and cloud modernity.
Automation Anywhere was very late to the market trying to develop its own process intelligence capability, Discovery Bot. When the vendor eventually launched the solution earlier in 2020, its key differentiator against other existing tools was simply that it was built within the AA platform and integrated with IQBot and other AA components. Discovery Bot was eventually offered as a complimentary solution for existing AA clients and signals the vendor’s lackluster efforts to catch up with the fast-growing process intelligence market. Acquiring FortressIQ now feels late in the game to bridge the same gap from 3 years ago which Discovery Bot struggled to fill.
FortressIQ on its part seemed poised for a possible Microsoft tuck-in acquisition. The software giant invested in FortressIQ’s 2020 Series B round through its venture fund, M2, and the companies deepened their relationship earlier this year. The companies saw a natural synergy around the Power Platform and were focusing their efforts on process discovery to support Power Automate use cases. The timing of the Automation Anywhere acquisition seems to suggest FortressIQ ran out of time waiting for Microsoft to pull the trigger, and secure its future with a competing partner. All while the vendor fought for market share alongside process intelligence pure plays, such as Celonis, that have grown to dominate the market.
Submerging process intelligence into the automation bucket is selling short the technology’s potential
FortressIQ’s original messaging was around “Data-driven insights powering transformation across your extended enterprise” – automation was one lever, but the technology has far wider applicability. If this acquisition is just about enabling automation, we’re going to call it, it will fail. AAI needs to think bigger. It can make FortressIQ part if its stack for the process discovery hookup, but using the power of process intelligence just to find automation opportunities is a massive undersell. UiPath already learned this with ProcessGold in the last two years. UiPath struggled with selling a process mining product and naturally fell back on the obvious sell of positioning as an add-on to RPA. ProcessGold is a proper mining tool so that link was never clear, as opposed to analyzing user activity data with discovery tools and finding RPA opportunities. Which helped Celonis drive over them. Now UiPath more actively decouples them.
As for our friends at AA, they need to be clear about what they want to do with FortressIQ. Is it just a conduit to automation? If that’s it, then what a waste. Even Kryon, which pioneered the combination, has realized that it has to decouple process discovery from automation. Automation MAY result from process intelligence insights, but it’s only one potential option. Structuring and orchestrating your business processes using data, real time process monitoring, and anticipating changes, transactions, and interactions to deliver superior customer experience are all more holistic approaches where process intelligence can and should be used. Automation is the discipline through which enterprises can achieve these goals, but it cannot be your entire strategy as a company, and what you preach as a technology vendor.
The value propositions on process intelligence and RPA are not aligned and aren’t hitting the same set of stakeholders. Technology firms must become comfortable getting out of their comfortable ‘categories’ and create solutions that their clients actually need.
Process mining is a CFO-level sale with a transformation focus – hence the likes of Celonis preaching working capital optimization and supply chain agility. The level of visibility into the state of operations that process intelligence tools offer, immediately make them appealing to business executives. RPA typically is addressed at two to three rungs down from the CFO to do quick fixes to legacy systems. The value propositions don’t mesh – unless you use the tools purely for automation projects.
By contrast, the Celonis and Servicenow partnership is a bold attempt to create products that bring the CIO+CFO worlds together. It’s not a surefire win, but it’s in the right direction to create something differentiating, blending operationalizing data science with the ability to design workflows in the cloud. Another example is startup Soroco that is exploring how technologies like automation, process mining, and discovery can impact multiple change programs, help remote teams be more effective, and drive more visibility into how work gets gone in an organization through its ‘work graph’ proposition.
FortressIQ lines up with Automation Anywhere’s push on cloud enablement, but won’t be a panacea
We acknowledge joining hands with cloud-native FortressIQ supports AA’s continued focus on cloud. But that won’t make it successful. The automation vendor forged a Google Cloud partnership earlier this year, where its Automation 360 platform became available on Google Cloud, with AA becoming Google Cloud’s preferred RPA partner. However, since the announcement, we have seen little sign of upside for something differentiating in the cloud from AA and – quite frankly – with the flagging update of GoogleCloud enterprise offerings, it’s hard to see where RPA fits into the conversation, especially when the Microsoft’s Power Automate focus has been so much more widespread and effective.
Will enterprises care? If you’re in the market for an emerging technology solution, use this as an opportunity to revisit your process strategy
As always, the sign of a good acquisition is that it ultimately needs to add up to more value for clients. What does the AA-FortressIQ combination mean for enterprises? Not a heck of a lot:
- Existing AAI clients who want process intelligence are already likely using something else rather than trying to manage with the bundled Discovery Bot.
- And FortressIQ clients are definitely already using RPA – and sure, some of it is AAI, but they were RPA agnostic.
The big win for enterprises will be to consider this an opportunity to think bigger than automation. Automation, ultimately, is the solution to bad or overly manual processes. Process intelligence allows enterprises to reclaim visibility and understanding of their processes and enables them to optimize them – which may or may not involve automation. However, given AAI’s core focus on automation, we’re skeptical this will happen.