Office 365 Is Becoming a Complete Enterprise Content Management Solution

A version of this post originally appeared in my CMSWire column.

With Office 365, Microsoft is poised to capitalize on big ECM’s lack of success over the last 18 years. Indeed, over the next five years, Office 365 is gradually becoming a (nearly) complete enterprise content management (ECM) solution.

The ECM world with FileNet and Documentum is nearly 20 years old.

How long have we had "real enterprise content management?" Let’s be generous: electronic document management started in the mid-1980s, but for argument’s sake, let's say that ECM started in 2000 around the time that FileNet and Documentum rose to prominence. That’s 18 years.

And in all that time—nearly two decades—not only have we failed to realize the paper free office, long predicted by the Association for Information and Image Management (AIIM), but we’re seemingly no closer to managing our "born digital" content stored on shared drives, email and other unstructured systems.

Most organizations maintain terabytes of unmanaged content.

The result is that most large organizations maintain terabytes (some even multiple petabytes) of unmanaged content on their systems, underwriting (for the most part implicitly) the huge risk associated with keeping this content.

Add to that the dismally low percentage of big ECM installs that are reported to have gone well. A recent AIIM survey noted that half of all respondents still primarily use shared drives for document management. (In Doculabs’ experience, the percentage is closer to 90 percent.)

So you have to ask: Will big (or even medium-sized) ECM ever succeed in solving the content management challenges of most large organizations?

How Microsoft is evolving Office 365 from basic document management into an information management platform.

For a number of reasons, I think the answer to the preceding question is a resounding “No.” And I think the main reason for this is that Microsoft, with everything it’s doing to develop (and peddle) Office 365, is poised to dominate the ECM space at most large organizations over the next five years.

From basic document management and collaboration, to more specialized capabilities like workflow, records management, e-discovery, file analytics and digital loss prevention (DLP), Microsoft is rapidly evolving Office 365 to provide these (and other) capabilities to not only “good enough,” but market-leading levels.

Let’s look at some of the key reasons why Microsoft is poised to capitalize on big ECM’s lack of success over the last 18 years and what the world of ECM might look like in the next five years. See the CMSWire post, Viewing Information Management's Evolution Through an Office 365 Lens.

The Office 365 land grab starts with its cloud-based repository.

The vast stores of unstructured content that have been amassing at organizations since the mid 1990s will only be moved to the cloud once (at least in our lifetimes). And, while five years ago, the final resting place of this massive trove of content was up for grabs (Box, Dropbox, Google, Amazon, Microsoft, big ECM cloud solutions), today I think the answer is clear: I predict it will all (or at least 90 percent of it) end up in Office 365.

Whether SharePoint online, OneDrive, Teams, Exchange, or something as-yet-to-be-named that Microsoft cooks up, I’m certain all this unstructured content will one way or another wind up under Microsoft’s control.

In three years, will you need both Office 365 and big ECM?

I had a client tell me that if Microsoft had provided a vision of where the company would be today three years ago, they wouldn’t have spent $5 million on a big ECM project. But three years ago, Microsoft only was concerned with ensuring that the unstructured content at organizations would end up in Office 365. The client’s company, at the time, was not as concerned with the functionality Office 365 provided once businesses got there. But with so many organizations now on the platform, Microsoft finally can focus on functionality.

Some of the first capabilities Microsoft provided in Office 365 were around governance. These include e-mail management, records management and e-discovery. This was a smart move, because managing content to meet regulatory requirements is critical.

How Office 365 may have “good enough” content governance capabilities.

And while Office 365 is not a market leader in any of these spaces, Doculabs’ experience with our clients and others is that Office 365 is “good enough” to support these functions. So if not today, in the near-enough future, Office 365’s content governance capabilities will make investing six or eight (or nine) figures in other solutions untenable.

An organization that today buys a market-leading solution for content governance and records management might spend at least 18 months getting that solution up and running. By that time Office 365 should be functionally equivalent to the ECM solution with no necessary spend beyond the E3 or E5 licenses they already may pay for.

Office 365 and workflow tools.

I’ve recently heard from three clients that the Microsoft workflow tools provide 85 to 95 percent of the capabilities provided by specialized workflow tools. Were these clients managing millions of transactions a month on these workflows? No. But they were talking about workflow for business critical processes, such as asset management for energy companies or customer service workflows in financial services.

Given the long timeframes and high costs of developing these workflows in more traditional systems, why wouldn’t most clients hold fast with what they have and wait until Office 365 provides the workflow tools they need rather than doubling down and spending additional money on these specialized systems?

The answer in most cases is that they’ll do just that, and that Microsoft will own the “good enough” workflow market, much like they already have the “good enough” document repository market.

For some companies, Office 365 translates into portfolio rationalization—fewer systems to manage.

The name of the game for CIOs is cost containment, because the less it costs to keep the lights on, the more budget they (theoretically) have for strategic projects that deliver real business value. No matter how you judge my take on the specialized capabilities of Office 365, it’s hard to argue that going all in on Office 365 doesn’t provide a significant level of portfolio rationalization (and the follow on cost reductions associated with using fewer and fewer solutions.)

We can debate whether this is a real or illusory cost savings (given the complexity of IT cost accounting) or whether, once we calculate the true total cost of moving onto Office 365, we actually gain the ROI we predicted. The fact remains that in the short term (and in the terms most commonly used by corporate finance) Office 365 looks really good on paper. And, as sad as it may be, “looking good on paper” is what keeps most CIOs employed.

Add to that the fact that the cost of leading point solutions in domains like document management, file analytics, data loss prevention, e-discovery and the like, it’s hard to imagine any reasonable CIO holding out for very long against the Office 365 juggernaut.

Best Practices for Setting Up Office 365 SharePoint Online


Rich Medina
Joe Shepley
I’m VP and Practice Lead, focusing on developing Doculabs’ InfoSec practice and its applications in a wide range of industries.