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There are few certainties in life but change is one of them and if you’re in the software and IT services (SITS) space, that change will be frequent and dramatic. In the enterprise software and application services (ESAS) space there is an additional complicating dimension – disruptive technologies that are impacting every aspect of supply and buy side operations, of vendor, application service supplier, and enterprise client strategies and practices.
Determining what that means for the UK SITS market, identifying the opportunities and how to capitalize on them, and warning of the pitfalls, is why I am excited to be joining TechMarketView at this time to head up Enterprise Software & Application Services research.
When viewed from a distance the sector appears mature to the point of stultification, saturated at the high end and dominated by a small number of “mega vendors” (SAP, Oracle, Microsoft), who command around 80% of the market and seek to hold onto to it via “tied ecosystems” - partner networks dependent on a single mega vendor’s technology stack. But this rigid and top-heavy edifice is starting to break down, undermined by a wave of disruptive technologies
Cloud computing and SaaS applications, mobile communications, collaboration and social networks, are changing everything from the definition and development of applications, the mode of supply, access mechanisms, integration, payment models, and value-add service provision.
They are providing a new lease of life to traditional applications such as ERP, CRM and SCM. They are widening access and stimulating new ways of using analytics – a poorly understood and therefore shockingly underused business tool.
Stimulus for change is also coming from small and medium enterprises (SME’s) who are demonstrating a healthy appetite for disruptive technologies, while the consumer market continues to inspire technology and usage innovation in the business world.
As an established vendor or application service provider you need to adjust or completely revamp your business models and offerings in order to thrive – or even just plain survive - in this new environment. You need to understand yourself in the context of this rapidly evolving market, competitors, and potentially dangerous emergent players. It doesn’t pay to underestimate new players – just look at the impact salesforce.com has had on CRM, SaaS and the wider cloud environment. So, where are the opportunities and the traps, who will be the winners and losers? These are some of the issues I will be exploring over the coming months.
We are not going to see the mega vendors fall out of the market but we can expect new entrants because the barriers to entry have been lowered and the rules of engagement are changing. These types of changes will cause a reshuffle across the sector as business models and targets change and money flows to different places, giving some players a boost and inevitably destabilizing others. Spotting the changes in spending patterns, market size and growth that determine how you fare will be core to TechMarketView ESAS research. There will also be opportunities for new players and particularly for new alliances and this is where I expect a lot activity.
By exploring these types of issues I aim to help guide you through the evolving enterprise applications and application services landscape. I am keen to hear your views so please feel free to make contact (aeager@techmarketview.com).
Posted by Angela Eager at '07:20' - Tagged: saas strategy software
