Enterprise Applications market set to diversify, says IDC

by CXOtoday News Desk    Feb 21, 2013

Enterprise Applications

The Indian enterprise applications market (ERM) set to diversify with on-demand and vertical specific solutions triggering its adoption, according to research firm IDC. The research firm predicted that the Indian ERM market will be pegged at $400 million in 2013 and the market is expected to grow at an average of about 12.8 per cent till 2016. However, it has slightly downgraded its ERP forecast for the coming periods due to the continued mindset of caution and highly careful investments by organizations.

The second biggest chunk of enterprise software, CRM will also reach about $320 million) this year, says IDC stating that the CRM market outlook is comparatively more bullish, with very similar growth trajectory as ERP for the next five years.

According to the research firm, both ERP and CRM make up the entire readymade enterprise software market, barring customized application development. However, both have been hit in recent years as the Internet has become all pervasive and companies, especially SMBs have started to take advantage of the network and offer browser-based tools at a fraction of the cost of traditional CRM and ERP software.

“When looking at the SMB segment it is important to note that these companies are looking for faster deployment of applications and less customization. They also understand that, as the level of customization increases, the cost as well as complexity goes up” says Shweta Baidya, Senior Market Analyst- Software, IDC India.

She believes that in line with the need, vendors have started expanding their portfolio through partnerships or acquisitions to be able to offer a comprehensive end to end solution to the customers under one wing.

SaaS model (Software as a service) is going to drive the ERM deployments specifically in the SMB segment due to its subscription or pay-per-use model. According to Nirupam Chaudhuri, Research Manager, Software and Services, IDC India, “Leading vendors have a dual focus on their on premise as well as on demand delivery models for enterprise applications and working with partners to make the most of the existing pie in the market across employee segments. This level of flexibility and agility is expected from the market leaders in these challenging times.”
It has been observed that companies are more likely to work with firms that understand their business processes better and suit their requirements and budget.