PRESS RELEASE
Gartner Dataquest Says Service Process Optimization Software Market to Continue Its Strong Growth - Gartner's SPO Summit to Explore Market Trends
BEDFORD, NH., May 15, 2002 (BUSINESS WIRE) -- While some segments of the enterprise application software (EAS) markets have shown little or negative growth, the service process optimization (SPO) software market has been one of the bright spots for the software industry, according to Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).
Gartner Dataquest analysts said the worldwide SPO market grew more than 50 percent in 2001, to $272 million, and is forecast to grow another 50 percent in 2002 to $414 million.
Demand for SPO software will continue as service organizations seek tighter financial controls and improved resource allocation. Although traditionally targeted at professional services organizations, SPO has been expanding its reach to internal IT and other service branches within organizations.
"In this competitive economy, characterized by renewed attention to efficiency and cost reduction, SPO offers the potential to streamline an organization's service management and delivery process," said Ted Kempf, principal analyst for Gartner Dataquest's IT Services program. "As the adoption of SPO software increases, companies that offer point solutions, such as stand alone project management and time and expense capture tools, may find themselves at a strong disadvantage if they do not develop an integrated SPO solution."
Gartner Dataquest defines SPO software as integrated software designed to optimize the allocation and tracking of resources (people, intellectual capital and time) and administer outward functions and inward processes of service-intensive industries, organizations and departments.
Because much of SPO functionality already exists, many EAS Technology and Service Providers are increasingly adding SPO to their product offerings and have begun to sell to their customer base. As SPO moves from competitive advantage to competitive necessity, EAS Technology and Service Providers not already active in the space must consider entry through product development, acquisition or, for the short term, partnerships with established SPO Technology and Service Providers.
"No clear market share leader has emerged, and as EAS Technology and Service Providers continue to penetrate the SPO space, they will validate the industry and increase competition," said Hams El-Gabri, analyst for Gartner Dataquest's Software Industry Research group. "Hosted models have recently gained popularity and are expected to continue to do so until clear signs of economic recovery are present. Traditional Technology and Service Providers should look for opportunity in alternative revenue models to supplement buyer choices."
SPO applications will continue to improve, offering better integration with front-and back-office customer relationship management (CRM), human resources and financial enterprise resource planning (ERP) modules. Gartner Dataquest analysts believe that SPO Technology and Service Providers that want to become market leaders in this space must enhance opportunity and resource management functionality, time and expense capture/project accounting, as well as improve reporting and forecasting abilities. Analytics will play a role in a rising trend toward real-time corporate decision making and are expected to become a critical driver for the growth and development of the SPO software market.
More information on the future of the SPO market will be presented at Gartner's SPO Summit which will be held July 17-19, 2002 at the Hilton Torrey Pines, in La Jolla CA. This event brings together IT professional services firms, internal IT departments and embedded services departments looking to implement solutions in the coming year, and is focused on exposing them to best of breed, as well as, fully integrated SPO products and research in an interactive format. For more information on this conference, please contact Charles Badoian at 603-471-4211 or via email at charles.badoian@gartner.com.
Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry. Gartner, Inc. is a research and advisory firm that helps more than 11,000 clients understand technology and drive business growth. Gartner's divisions consist of Gartner Research, Gartner Consulting, Gartner Measurement and Gartner Events. Founded in 1979, Gartner, Inc. is headquartered in Stamford, Connecticut, and consists of 4,300 associates, including 1,200 research analysts and consultants in more than 90 locations worldwide. The company achieved fiscal 2001 revenue of $952 million. For more information, visit www.gartner.com.
