Predictions 2014: Enterprise Software & App Services

Activity in the Enterprise Software & Application Services (ESAS) sector will revolve intensively around information in 2014 as organisations act on the knowledge that they have to ‘use it or lose out’. The ability to monitor, capture, store, combine, manipulate, analyse, report, visualise and distribute data is core to the overall TechMarketView 2014 Race for Change theme whereby private businesses and public sector have to spot change faster, execute and extract value within an increasingly short half-life, then accelerate on to the next cycle.

That is why many application services suppliers are creating businesses within the business – dedicated digital units built around the high growth SMAC (social, mobile, analytics and cloud) areas where fast delivery and fast returns are prime requirements - and ‘legacy’ enterprise software vendors are scrabbling to modernise and extend their core products to cater for the faster operational tempo of their clients. All the while pacier competitors are slicing into revenue streams.

This is the background for our predictions for 2014:

The rise of the data-driven business: Aggregating, assimilating, sharing and acting on expanding, rapidly changing and sometimes transient data is the biggest challenge facing organisations. Smart automation, analytics and machine intelligence are the foundations for a shift from qualitative to quantitative decision making, whereby decisions are made and verified based on available data rather than intuition (there is always a place for intuition but it will apply at different stages of the decision lifecycle). With organisations under relentless pressure for faster, more consistent decision-making, greater productivity, a sharper competitive edge and increased profitability, enabling the data driven business will be a focus for both the buy and supply sides of the ESAS market. Suppliers need an extensive and coherent portfolio and skillset because the change requirements go beyond big data and analytics and drive demand for information and process management strategies, governance, privacy – and security.   

Complexity will change the cloud services supply channel: The many cloud platforms and even more numerous cloud-based applications is creating complexity from a cost, management and integration perspective so there will be a concerted drive towards aggregation, orchestration and brokerage around cloud services. This provides new opportunities for application services providers, who can use the opportunity to embed themselves as strategic providers, but will change the way cloud services are procured and paid for, and sever the direct relationship between SaaS providers and client. This will have cost implications (will orchestration allow providers to levy charges that can deliver profit and high margins – something that is missing in the SaaS space?) and may well lead to a bifurcation in the cloud services supply channel.

SaaS and Enterprise App Store commercial models will come under greater scrutiny: With more questions being asked about the lack of bottom line rewards, the question of the viability of the SaaS commercial model based on current pricing levels is set to come to a head. It will be acerbated by fevered growth in enterprise app stores and the struggle to monitise this emerging route to market. Combine that with growing maturity and the need to push further into the back office, which will moderate SaaS growth, and 2014 could be the year when SaaS pure-plays have to reset expectations.

Enterprise investment shifts to the digital front office: Organisations will prioritise their spending around the digital front office, user experience, customer engagement and omni-channel enablement, driven by priorities set by Chief Marketing Officers and Line Of Business managers who are not just influencers but are now significant budget holders. Suppliers need to win the hearts and budgets of these new types of buyers.

Smartening up mobile apps: Smart mobile enterprise apps that exploit the capabilities of the mobile device, to process information in the background to enable real-time location and context-based user interactions for example, are poised for a breakthrough. Their cue is using information to improve the quality and appropriateness of the mobile experience. And with that we’re back to where we started – information at the core.  

Posted by: Angela Eager at 09:34

Tags: software   predictions   applications  

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