IDC's software taxonomy, 2007

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IDC's software taxonomy, 2007

  1. 1. INDUSTRY DEVELOPMENTS AND MODELS IDCs Software Taxonomy, 2007 Richard V. Heiman IDC OPINION IDCs software taxonomy represents a collectively exhaustive and mutually exclusive view of the worldwide software marketplace. This taxonomy is the basis for the relational multidimensional schema of the IDC Software Market Forecaster researchwww.idc.com database. The information from this continually updated database is used to generate consistent packaged software market sizing and forecasts. Highlights are as follows: ! For 2007, the taxonomy includes 79 individual functional markets grouped within three primary segments of "packaged" software: applications, applicationF.508.935.4015 development and deployment (AD&D) software, and system infrastructure software. ! Revenue is further segmented across three geographic regions and nine operating environments.P.508.872.8200 ! Additionally, the taxonomy defines a wide range of "competitive" markets that are combinations of whole or fractions of functional markets and that reflect such market dynamics as the problem being solved or the technology on which the software is based.Global Headquarters: 5 Speen Street Framingham, MA 01701 USA Filing Information: February 2007, IDC #205437, Volume: 1, Tab: Markets Software Overview: Industry Developments and Models
  2. 2. T ABLE OF CONT ENT S PIn This Study 1Executive Summary.................................................................................................................................. 1S i t u a t i o n O ve r v i e w 2Introduction............................................................................................................................................... 2What Is Packaged Software? ................................................................................................................... 3General Functional Market Definitions...................................................................................................... 5Software Taxonomy Functional Market Changes for 2007 ....................................................................... 8Applications Market Definitions................................................................................................................. 10 Consumer Applications...................................................................................................................... 11 Consumer Software.................................................................................................................... 11 Collaborative Applications ................................................................................................................. 11 Integrated Collaborative Environments ...................................................................................... 11 Messaging Applications.............................................................................................................. 12 Team Collaborative Applications ................................................................................................ 13 Conferencing Applications.......................................................................................................... 13 Other Collaborative Applications ................................................................................................ 13 Content Applications.......................................................................................................................... 13 Content Management................................................................................................................. 14 Authoring and Publishing Software ............................................................................................ 15 Search and Discovery ................................................................................................................ 15 Enterprise Portals....................................................................................................................... 16 Enterprise Resource Management Applications................................................................................ 16 Financial Accounting Applications .............................................................................................. 17 Human Capital Management...................................................................................................... 18 Payroll ........................................................................................................................................ 21 Procurement............................................................................................................................... 21 Order Management .................................................................................................................... 23 Financial Performance and Strategy Management Applications ................................................ 24 Project and Portfolio Management ............................................................................................. 24 Enterprise Asset Management ................................................................................................... 25 Supply Chain Management Applications ........................................................................................... 25 Logistics ..................................................................................................................................... 26 Production Planning ................................................................................................................... 26 Inventory Management............................................................................................................... 26 Operations and Manufacturing Applications ...................................................................................... 27 Services Operations Management ............................................................................................. 27 Manufacturing............................................................................................................................. 27 Other Back Office ....................................................................................................................... 27 Engineering Applications ................................................................................................................... 28 Mechanical Computer-Aided Design .......................................................................................... 28 Mechanical Computer-Aided Engineering .................................................................................. 28 Mechanical Computer-Aided Manufacturing............................................................................... 29 Product Information Management .............................................................................................. 29 Other Engineering ...................................................................................................................... 29 Customer Relationship Management Applications ............................................................................ 30#205437 ©2007 IDC
  3. 3. T ABLE OF CONT ENT S — Continued P Sales .......................................................................................................................................... 30 Marketing.................................................................................................................................... 31 Customer Service....................................................................................................................... 32 Contact Center ........................................................................................................................... 32Application Development and Deployment Market Definitions ................................................................. 33 Information and Data Management Software .................................................................................... 33 Relational Database Management Systems............................................................................... 33 Nonrelational Database Management Systems ......................................................................... 34 Database Development and Management Tools ....................................................................... 35 Data Integration and Access Software ....................................................................................... 36 Application Development Software.................................................................................................... 39 Unified Development Environments ........................................................................................... 39 Third-Generation Language Tools.............................................................................................. 40 Software Construction Components........................................................................................... 41 Analysis, Modeling, and Design Tools........................................................................................ 41 Web Site Design/Development Tools......................................................................................... 42 Quality and Life-Cycle Tools.............................................................................................................. 42 Automated Software Quality Tools ............................................................................................. 42 Software Configuration Management Tools ............................................................................... 42 Application Deployment Software...................................................................................................... 43 Application Server Software Platforms ....................................................................................... 43 Integration Server Software Platforms........................................................................................ 45 Message-Oriented Middleware................................................................................................... 46 Transaction Server Middleware.................................................................................................. 47 Industry-Specific Application Deployment Software ................................................................... 47 Application Deployment Adapters/Connectors ........................................................................... 47 Other Development Tools.................................................................................................................. 48 Other Programmer Development Tools and Utilities .................................................................. 48 Data Access, Analysis, and Delivery Software .................................................................................. 48 End-User Query, Reporting, and Analysis.................................................................................. 48 Advanced Analytics Software ..................................................................................................... 49 Spatial Information Management Software................................................................................. 49System Infrastructure Software Market Definitions................................................................................... 50 System and Network Management Software .................................................................................... 50 Event Automation Tools ............................................................................................................. 50 Job Scheduling Tools ................................................................................................................. 50 Output Management Tools ......................................................................................................... 51 Performance Management Software .......................................................................................... 51 Change and Configuration Management Software..................................................................... 51 Problem Management Software ................................................................................................. 52 Network Management Software ................................................................................................. 52 Security ............................................................................................................................................. 53 Identity and Access Management .............................................................................................. 53 Secure Content and Threat Management .................................................................................. 54 Security and Vulnerability Management Software ...................................................................... 55 Other Security Software ............................................................................................................. 56 Storage Software............................................................................................................................... 56 Data Protection and Recovery Software..................................................................................... 56©2007 IDC #205437
  4. 4. T ABLE OF CONT ENT S — Continued P Storage Replication Software ..................................................................................................... 58 Archive and HSM Software ........................................................................................................ 59 File System Software ................................................................................................................. 60 Storage Management Software.................................................................................................. 60 Storage Infrastructure Software.................................................................................................. 61 Storage Device Management Software ...................................................................................... 61 Other Storage Software.............................................................................................................. 62 System Software ............................................................................................................................... 62 Operating Systems and Subsystems ......................................................................................... 62 Clustering and Availability Software ........................................................................................... 62 Virtual User Interface Software................................................................................................... 63 Virtual Machine Software............................................................................................................ 63 Remote Control Software ........................................................................................................... 64 Other System Software .............................................................................................................. 64Geographic Area Definitions..................................................................................................................... 65Operating Environment Definitions ........................................................................................................... 65Other Market Views .................................................................................................................................. 67 Formal Competitive Markets Tracked................................................................................................ 67 Not Necessarily Mutually Exclusive ................................................................................................... 69 Applications-Based Competitive Markets .......................................................................................... 71 Data Warehousing Tools and Analytic Applications ................................................................... 71 Enterprise Resource Planning Applications................................................................................ 72 Enterprise Workplace ................................................................................................................. 73 Mobile Enterprise Applications ................................................................................................... 73 Supplier Relationship Management Applications ....................................................................... 74 Product Life-Cycle Management Applications ............................................................................ 75 Application Development and Deployment Software Competitive Markets ....................................... 76 Business Process Automation Software..................................................................................... 76 Embedded Database Management Systems ............................................................................. 77 Enterprise Metadata Technologies............................................................................................. 78 IT Governance............................................................................................................................ 78 Master Data Management .......................................................................................................... 79 Service Oriented Architecture and Web Services....................................................................... 81 Legacy Integration and Analysis Software.................................................................................. 83 System Infrastructure Software Competitive Markets........................................................................ 84 IT Asset Management Software ................................................................................................. 84 Mobile Device Management Software........................................................................................ 85 Mobile Middleware and Infrastructure Software ......................................................................... 85 Mobile Security Software............................................................................................................ 86 Software Distribution .................................................................................................................. 86Future Outlook 87Essential Guidance 87Learn More 87Related Research ..................................................................................................................................... 87Appendix A: Lexicon ................................................................................................................................. 87Appendix B: IDCs Software Market Forecast and Analysis Methodology ................................................ 99#205437 ©2007 IDC
  5. 5. T ABLE OF CONT ENT S — Continued P Company Revenue Modeling ............................................................................................................ 100 Revenue Recognition ........................................................................................................................ 100 Immediate Recognition............................................................................................................... 100 Deferred Recognition ................................................................................................................. 101 Subscription Revenue ................................................................................................................ 101 Mergers and Acquisitions: "Backstreaming" ...................................................................................... 101 Calendar Versus Fiscal Years ........................................................................................................... 101 Treatment of Exchange Rates ........................................................................................................... 102 Allocating Revenue to Geographic Regions ...................................................................................... 102 Allocating Revenue to Operating Environments ................................................................................ 102 Historical Data Reporting................................................................................................................... 102 Determination of "Other".................................................................................................................... 103 "When a Product Becomes a Feature" .............................................................................................. 104 Forecast Methodology ....................................................................................................................... 104 Competitive Market Maps .................................................................................................................. 105©2007 IDC #205437
  6. 6. LIST OF T ABLES P 1 Packaged Software Functional Taxonomy, 2007: Applications by Secondary Market ................. 6 2 Packaged Software Functional Taxonomy, 2007: Application Development and Deployment Software by Secondary Market .................................................................................................... 7 3 Packaged Software Functional Taxonomy, 2007: System Infrastructure Software by Secondary Market ........................................................................................................................ 8 4 Summary of Software Functional Market Changes for 2007........................................................ 9 5 IDCs Software Competitive Markets, 2007.................................................................................. 68#205437 ©2007 IDC
  7. 7. LIST OF FIGURES P 1 Packaged Software Revenue Data Model ................................................................................... 2 2 Model of Overlapping Competitive Markets.................................................................................. 70 3 Model of Mutually Exclusive Competitive Markets ....................................................................... 71 4 "Other" Company Estimation Model............................................................................................. 104 5 Sample Competitive Market Map ................................................................................................. 107©2007 IDC #205437
  8. 8. IN THIS STUDYThis IDC study provides a detailed description of IDCs software market taxonomy.For 2007, the taxonomy includes 79 individual functional markets grouped withinthree primary segments of "packaged" software: applications, applicationdevelopment and deployment (AD&D) software, and system infrastructure software.Revenue is also segmented across three geographic regions and nine operatingenvironments. More granular geographic detail is available in many cases fromvarious IDC regional and country offices.Additionally, the taxonomy defines a wide range of "competitive" markets.Competitive markets are combinations of whole or fractions of functional markets thatreflect such market dynamics as the problem being solved or the technology on whichthe software is based.Executive SummaryIDCs software research programs maintain a centralized database that includesworldwide total packaged software revenue for more than 1,000 software vendors.We do not contend that this is an exhaustive list of software providers; in fact, webelieve there are more than 10,000 such suppliers. However, our database isdesigned to support very precise forecasting, and the suppliers in the databaserepresent a majority of the software markets revenue overall and a majority of therevenue in each of the various segmentations it supports. The revenue is allocated tofunctional market segments, geographic areas, revenue types, industries, channels,and operating environments. The functional software markets defined by thetaxonomy represent a collectively exhaustive and mutually exclusive view of theworldwide software marketplace.IDCs software market taxonomy is the basis for the relational multidimensionalschema of the IDC Software Market Forecaster research database. The informationfrom this continually updated database is used by IDCs software ContinuousIntelligence Services (CISs) (i.e., our subscription research services) to generateconsistent packaged software market sizing and forecasts.Total packaged software revenue is defined as license revenue plus maintenancerevenue plus subscription and other software revenue. It is primarily the totalpackaged software revenue that is further allocated to markets, geographic areas,and operating environments. In addition to total packaged software revenue, IDCcollects software license revenue, software maintenance revenue, subscription andother software–related revenue, and total company revenue (see Figure 1):! License revenue includes revenue collected for software licenses, either limited term (lease) or perpetual, that include licenses for new installations of a software product, licenses for additional software options, changes to existing licenses permitting more users or more computer system resources to be used by the licensed software (based, of course, on the original license agreement); such changes are often necessitated by server upgrades or staff increases or conversions of licenses that result in incremental additional revenue such as©2007 IDC #205437 1
  9. 9. conversions from a fixed number of users or processors to a site or enterprise license. License revenue does not include license maintenance revenue, which typically includes fees covering version upgrades, the automatic delivery of bug fixes and patches, and basic telephone support, all of which are normally delivered during a fixed, renewable term of service.! Maintenance revenue consists of fees charged for continuous improvement of the software by repairing known faults and errors and/or enhancing and updating the product, as well as for technical support.! Subscription/other software revenue consists of fees to use software products and to receive maintenance and support for those software products for a limited period of time. Subscriptions consist of bundled software and services where the fair value of the license fee is not separately determinable from maintenance/support. This category also includes software lease or rental revenue (often, but not exclusively, applied to mainframe software).FIGURE 1Packaged Software Revenue Data Model License revenue + Maintenance revenue + Subscription/other software revenue = Total packaged software revenue + Other revenue (e.g., nonrecurring IT service fees, hardware, business process services) = Company revenueSource: IDC, 2007SITUATION OVERVIEWIntroductionThe first section of this study describes the IDC software functional market taxonomyas updated for 2007. It includes general definitions of terms, functional marketdefinitions and descriptions, and definitions of geographic areas and operatingenvironments. The functional markets are defined in terms of the features, functions,and attributes of the software package, not the problem being solved or thetechnology on which it is based.2 #205437 ©2007 IDC
  10. 10. Additionally, this study defines a wide range of competitive markets. Competitivemarkets are combinations of whole or fractions of functional markets that reflect suchmarket dynamics as the problem being solved or the technology on which thesoftware is based.Competitive markets are typically more ad hoc because they are meant to reflectcurrent market approaches, coalitions, standards, and software architectures. Somecompetitive markets have been modeled to address a broad solution marketcategory. Others, for example, define a market view particular to an architecture orrepresent revenue in subsets of geographic regions.What Is Packaged Software?How does IDC identify the companies it measures and the resulting value of themarkets? Our objective is to define companies and markets that are relevant formarket research purposes — not for legal or accounting purposes nor simply forpublishing historic lists. Clearly, many companies have software and other types ofbusiness units; this taxonomy is not about deciding on the relative strengths of thesebusiness units and applying a single label to the entire company.The question therefore is, When does a company market and deploy software thatshould be counted as such for market research purposes?IDC uses the term packaged software to distinguish commercially available softwarefrom "custom" software, not to imply that the software must be shrink-wrapped orotherwise provided via physical media. Packaged software is programs or codesets ofany type commercially available through sale, lease, or rental, or as a service.Packaged software revenue typically includes fees for initial and continued right-to-use packaged software licenses. These fees may include, as part of the licensecontract, access to product support and/or other services that are inseparable fromthe right-to-use license fee structure, or this support may be priced separately.Upgrades may be included in the continuing right of use or may be priced separately.All of the above are counted by IDC as packaged software revenue.Packaged software revenue excludes service revenue derived from training,consulting, and systems integration that is separate (or unbundled) from the right-to-use license but does include the implicit value of software included in a service thatoffers software functionality by a different pricing scheme (as described directly belowin more detail).Increasingly, packaged software is also being marketed and deployed on asubscription and transaction basis, as well as via other arrangements (e.g., for "free"with the packaged softwares "owner" taking a percentage of the revenue enabled bythe software as implicit "product" revenue), some of which do not involve a license.Software has also long been available for lease or rent, typically on mainframes.Furthermore, we must not be limited by accounting directives (such as those releasedby AICPA and FASB) because this would neglect to count large segments of softwaremarkets in a way that accurately reflects market dynamics and future opportunity.©2007 IDC #205437 3
  11. 11. IDCs Software Market Forecaster research database includes revenue from acompany if the company competes in a packaged software market defined in thetaxonomy. From the market research standpoint, this is the most important question.Software revenue is defined in terms of two types of offerings from the viewpoint ofthe customer:! The market for software code of a given functionality sold as such, typically via a perpetual license! The market for software code bundled and marketed in another way (e.g., an application service) that competes with perpetually licensed software productsTo be classified as packaged software revenue attributed to a company in theSoftware Market Forecaster research database, all of the following have to be true:! Ownership of intellectual property. Application service providers (ASPs) that do not own the software code are not software vendors but channels for software vendors. However, some vendors own the code and also provide an ASP offering. In this case, IDC estimates a value for the software provided in that manner. However, in the case of packaged open source software (where there is no "owner" of the intellectual property), revenue is attributed to the distributor.! Product is replicated. Software companies assemble a package of code from components and "sell" multiple copies in a one-to-many business model. The software product is replicated to support that model. Even though it may be customized as it is being installed, when the customization capability is an attribute built into the code, it is still considered replicated. Value-added resellers (VARs) do customization to packaged software, often on a one-to-one basis. In this case, VARs are a channel for the software. When a company takes code and adds its own changes and sells the resulting package substantially as changed to many customers, it is — in turn — an ISV that resells or OEMs components and adds value. (In these cases, IDC estimates the pass-through revenue and deducts it from the reseller and attributes it to the original owner of the intellectual property so as not to double count revenue and artificially inflate the size of the software market.)! Competitive domain includes packaged software companies that license intellectual property rights to functionally similar software code. There are companies that offer to their customers packaged software functionality not via a right-to-use license but as a "service" that is wholly or partially based on software functionality. In this case, the question becomes, Does the company compete with packaged software companies that provide the same functionality? If so, a significant part of the basis of competition is the functionality of the software. Thus, there is a software component of the service companys revenue stream, and the value of the software must be "implicitly derived" or "attributed" and subtracted from the commingled revenue stream. Counting becomes difficult if the commingled product never has had a history of standalone software sales, and thus there is no requirement (from accounting rules) for calling out the revenue on the income statement. This accounting rule does not change the market dynamics — as far as the customer is concerned, services with the same4 #205437 ©2007 IDC
  12. 12. functionality are available as substitutes for licensed software products, and IDC must account for this in our estimate of the size of the software market. This procedure has been used by IDC in the operating system market for many years when operating system revenue is bundled with hardware platforms. The operating system is an important part of the value of the competitive hardware offering. Software vendors sometimes do not offer the same functionality in standalone form.See Appendix A: Lexicon for a definition of terms used frequently throughout the IDCsoftware taxonomy but that are not defined within the body of this study because theyare not markets or submarkets. Also, see Appendix B: IDCs Software MarketForecast and Analysis Methodology for an overview of the methodology employed byIDCs software analysts for collecting, analyzing, and reporting revenue data for thecategories defined by the software taxonomy.General Functional Market Definitions! The worldwide software market includes all packaged software revenue across all functional markets or market aggregations.! Primary software markets are the aggregation of the functional markets for applications, AD&D, and system infrastructure. The three primary markets together make up the worldwide software market.! Secondary software markets are 18 important aggregations that make up IDCs packaged software market taxonomy. These secondary markets are consumer applications, collaborative applications, content applications, enterprise resource management (ERM) applications, supply chain management (SCM) applications, operations and manufacturing applications, engineering applications, customer relationship management (CRM) applications, information and data management software, application development software, quality and life-cycle tools, application deployment software, other development tools, data access, analysis and delivery software, system and network management software, security, storage software, and system software. These markets map into the three primary markets and collectively equate to the worldwide software market.! Functional markets are the focal point of IDCs analysis. IDC defines 79 individual functional markets for which it analyzes revenue by vendor, geography, and operating environment. Functional markets also provide the foundation and revenue base for the generation of competitive markets.! Submarkets describe one or more discrete functional areas within a specific market. Although submarket-level data may be reported in selected IDC studies, this level of detail is not recorded in the Software Market Forecaster database.Tables 1–3 provide an overview of the functional markets and secondary markets thatconstitute the applications, AD&D, and system infrastructure software markets.©2007 IDC #205437 5
  13. 13. T ABLE 1 Packaged Software Functional Taxonomy, 2007: Applications by Secondary Market Enterprise Customer Resource Supply Chain Operations and Relationship Consumer Collaborative Content Management Management Manufacturing Engineering Management Applications Applications Applications Applications Applications Applications Applications Applications Consumer Integrated Content Financial Logistics Services Mechanical Sales software collaborative management accounting operations CAD environments applications management Messaging Authoring Human Production Manufacturing Mechanical Marketing applications and capital planning CAE publishing management software Team Search and Payroll Inventory Other back Mechanical Customer collaborative discovery management office CAM service applications Conferencing Enterprise Procurement Product Contact applications portals information center management (PIM) Other Order Other collaborative management engineering applications Financial performance and strategy management applications Project and portfolio management (PPM) Enterprise asset management Source: IDC, 20076 #205437 ©2007 IDC
  14. 14. T ABLE 2 Packaged Software Functional Taxonomy, 2007: Application Development and Deployment Software by Secondary Market Information and Data Application Application Other Data Access, Management Development Quality and Life- Deployment Development Analysis, and Software Software Cycle Tools Software Tools Delivery Relational Unified Automated Application server Other End-user query, database development software quality software programmer reporting, and management environments (ASQ) platforms development analysis systems tools and utilities (RDBMS) Nonrelational Third-generation Software Integration server Advanced database languages (3GLs) configuration software analytics software management management platforms (ISSPs) systems (SCM) Database Software Message- Spatial development construction oriented information and components middleware management management tools Data integration Analysis, Transaction and access modeling, and server software design tools middleware Web site design/ Industry-specific development application tools deployment software Application deployment adapters/ connectors Source: IDC, 2007©2007 IDC #205437 7
  15. 15. T ABLE 3 Packaged Software Functional Taxonomy, 2007: System Infrastructure Software by Secondary Market System and Network Management Software Security Storage Software System Software Event automation Identity and access Data protection and recovery Operating systems and management software subsystems Job scheduling Secure content and threat Storage replication software Clustering and availability management software Output management Security and vulnerability Archive and HSM software Virtual user interface management software Performance Other security software File system software Virtual machine software management Change and configuration Storage management Remote control software management software Problem management Storage infrastructure Other system software software Network management Storage device management software software Other storage software Source: IDC, 2007Software Taxonomy Functional MarketChanges for 2007IDCs software functional market taxonomy is updated annually to reflect the dynamicnature of the software marketplace. This section describes the significant structuralchanges made in 2007. For reference, the previous version of the software taxonomyis documented in IDCs Software Taxonomy, 2006 (IDC #34863, February 2006).Note that in addition to structural changes, some markets were renamed anddefinitions were updated to reflect the evolution of specific market categories.The software taxonomy changes for 2007 are relatively few in comparison with previousyears. They can best be characterized as relating to consolidation or clarification ofmarket categories. For example, the previous content access tools market wasrenamed as search and discovery to more accurately reflect the functionality ofapplications included within it. This renamed market (along with enterprise portals) wasmoved to the content applications secondary market because these markets have8 #205437 ©2007 IDC
  16. 16. evolved to become more closely aligned with content management than with the formerinformation access and delivery secondary market — which is now termed data access,analysis, and delivery to denote the change in coverage.As an example of consolidation, four previously defined database markets (pre- andpostrelational, object-oriented, XML, and end user) have been aggregated as thesingle nonrelational database management market.All of the functional market structural changes for 2007 are summarized in Table 4. T ABLE 4 Summary of Software Functional Market Changes for 2007 2006 Market 2007 Market Comments Applications Content access tools Search and discovery Name changed and market moved from information access and delivery (an AD&D secondary market) to content applications to better reflect market coverage Translation/globalization Search and discovery Translation/globalization market merged into search and discovery market Enterprise portals No name or definition change Market moved from information access and delivery (an AD&D secondary market) to content applications to better align with associated markets Financial applications Financial accounting applications Renamed (no change in coverage) to provide clear differentiation from the financial performance and strategy management applications market Business performance Financial performance and strategy Name changed to better denote management and financial analytic management applications coverage area applications Application development and deployment Pre- and postrelational DBMS, Nonrelational database management Small database markets consolidated object-oriented DBMS, XML systems database management, end-user DBMS©2007 IDC #205437 9
  17. 17. T ABLE 4 Summary of Software Functional Market Changes for 2007 2006 Market 2007 Market Comments Information access and delivery Data access, analysis, and delivery Secondary market name changed to denote that the content access tools and enterprise portals markets are no longer included in this secondary market (see comments in previous Applications section of this table) Content access tools and Moved to applications See comments in previous Applications enterprise portals section of this table System infrastructure software Network and service management Network management software Name changed to better denote coverage area Security software Security Secondary market name changed for clarification — no change in coverage from 2006; security appliance revenue is included in this market Secure content management, Secure content and threat management Markets merged threat management Enterprise connectivity software Other system software Enterprise connectivity software market merged into other system software market Remote control software No name or definition change Market moved to system software secondary market — there is no longer a networking software secondary market Source: IDC, 2007Applications Market DefinitionsPackaged application software includes consumer, commercial, industrial, andtechnical programs and codesets designed to automate specific sets of businessprocesses in an industry or business function, to make groups or individuals inorganizations more productive, or to support entertainment, education, or dataprocessing in personal activity. The packaged application market includes theconsumer, collaboration, content, and enterprise applications subsegments; theenterprise applications market, in turn, is made up of the enterprise resourcemanagement, supply chain management, operations and manufacturing, engineering,and CRM applications markets.10 #205437 ©2007 IDC
  18. 18. Consumer ApplicationsConsumer applications are software products for recreation, education, and/orpersonal productivity enhancement.Consumer SoftwareThe consumer software market includes home education/edutainment products soldto homes for specific educational purposes (for either adults or children) or reference(e.g., dictionaries and encyclopedias); games and entertainment (sports,adventure/role playing, arcade/action, strategy, and family entertainmentapplications); and home productivity that covers the software categories of homecreativity, including all help, how-to, and lifestyle applications (e.g., cookbooks);personal productivity products, including resume writers, standalone calendars,expense records, will makers, and family-tree makers; and personal finance and taxpreparation programs. The following are representative vendors and products in theconsumer applications software market:! Electronic Arts (SIMS 2)! Intuit (Quicken)! Microsoft (Encarta)Note: IDC does not provide detailed functional analysis of the consumer applicationsmarket but tracks related revenue to provide a holistic view of the industry becausesome software providers market consumer, collaboration, content, and enterpriseapplications as well as other types of software.Collaborative ApplicationsCollaborative applications enable groups of users to work together by sharinginformation and processes. Definitions of collaborative applications market arepresented in the following sections.Integrated Collaborative EnvironmentsIntegrated collaborative environments (ICEs) provide a framework for electroniccollaboration, typically within an organization, based on shared directory andmessaging platforms. The core integrated-functionality areas are email, groupcalendaring and scheduling, shared folders/databases, threaded discussions, andcustom application development. Administration and customization are generallyperformed by centralized IT staff. The following are representative vendors andproducts in this market:! IBM (Lotus Domino/Notes)! Microsoft (Exchange/Outlook)! Novell (GroupWise)©2007 IDC #205437 11
  19. 19. Messaging ApplicationsMessaging applications consist of the submarkets discussed in the following sections.Standalone Email ApplicationsStandalone email applications provide a platform based on a message store, amessage transfer agent (MTA), a directory, and access protocols for use byenterprises or service providers to host email users over a local or wide area network,the Internet, or a dial-up connection. The following are representative vendors andproducts in this submarket:! Critical Path (Memova)! Mirapoint (Message Server)! Openwave (Email Mx and Mobile Email)! Sun (Java Systems Messaging Server)Instant Messaging ApplicationsInstant messaging applications provide instantaneous text messaging between userswho are online. Instant messaging management products are deployed in conjunctionwith an EIM application server or service to provide enhanced management, mobility,security, connectivity, or regulatory compliance. The following are representativevendors and products in these submarkets:! FaceTime (Enterprise Edition)! IBM (Lotus Sametime)! Jabber (XCP)! Microsoft (Office Communications Server and Office Live Communications Server)Unified Messaging ApplicationsUnified messaging applications provide a single mailbox for email, fax, and voicemessages accessible by PC, Web browser, and telephone. The following arerepresentative vendors and products in this submarket:! Avaya (Modular Messaging System, Unified Messaging, Communications Center)! Cisco (Unity Unified Messaging)! Microsoft (Exchange Unified Messaging! Nortel (CallPilot Unified Messaging)12 #205437 ©2007 IDC
  20. 20. Team Collaborative ApplicationsTeam collaborative applications (TCAs) provide an integrated set of Web-based toolsfor collaboration among team members from one or more organizations. The coreintegrated functionality areas are shared work spaces for managing and sharing files,assigning and coordinating tasks, and maintaining other project and team information.User and workspace administration, configuration, and customization are generallyperformed by individual users. Although all work asynchronously, several have addedreal-time collaborative tools. The following are representative vendors and products inthis market:! EMC (Documentum eRoom)! IBM (Lotus QuickPlace)! Interwoven (WorkSite)Collaborative applications designed for a particular vertical market such asmanufactured product design or life-cycle development (product data management[PDM] and product life-cycle management [PLM]) are not included here.Conferencing ApplicationsConferencing applications provide a real-time connection for the exchange, creation,and viewing of information by two or more users during scheduled or spontaneousonline meetings or events. The following are representative vendors and products inthis market:! Cisco (MeetingPlace)! IBM (Lotus Sametime)! Microsoft (Office Live Meeting, Office Communications Server)! SABA (Centra 7, Symposium, Online Business Collaboration)! WebEx (Meeting Center, Event Center, Enterprise Edition)Other Collaborative ApplicationsOther collaborative applications include group calendaring and schedulingapplications as well as those designed specifically for collaborative applications toprovide enhanced capabilities such as workflow and imaging. (General-purposeapplications are not included here.) The following are representative vendors andproducts in this market:! Sun (Java System Calendar Server)Content ApplicationsContent applications include content management software, authoring and publishingsoftware, search and discovery software (including translation and globalization©2007 IDC #205437 13
  21. 21. software), and enterprise portals. The specific market definitions are presented in thefollowing sections.Content ManagementContent management software builds, organizes, manages, and stores collections ofdigital works in any medium or format. The software in this market includes documentmanagement, Web content management, capture and image management, digitalasset management, and electronic records management. Content management formsthe foundation or the infrastructure for knowledge management.Applications in this market include one or more of the following functions:! Gathering and feeding documents and other media into collections via crawlers or other automated and/or manual means and performing metadata capture/enrichment, formatting, transformations, and/or conversion operations.! Organizing and maintaining information, including some or all of the following: # Indexing, cataloging, and/or categorizing information in the content management system # Building directories # Defining workflows for tracking documents and changes and sending alerts when action is required # Record keeping, auditing, and logging # Updating and purging content # Searching for information in the content management system (embedded tools may be provided)! Ensuring document security by managing rights and permissions to create, edit, post, or delete materials; managing user access; and protecting intellectual propertyRepresentative vendors in this market include:! Web content management, document management, capture and image management, and records management: Alfresco, CoreMedia, CrownPeak, Day Software, Ektron, EMC/Documentum, Fatwire, Hyland Software, IBM/FileNet, Inmagic, Interwoven, Kofax, Mediasurface, Meridio, Microsoft, Mobius Management Systems, Open Text/Hummingbird/RedDot, Oracle/Stellent, Percussion Software, Tridion, Vignette, Xerox, and ZyLAB! Digital asset management: Autonomy, Blue Order, Canto, Chuckwalla, ClearStory Systems, Dalet, EMC/Documentum, Extensis, Harris, IBM, Interwoven/MediaBin, Konan Digital, North American Systems/Ancept, North Plains Systems, Open Text/Artesia, Siemens, Venaca, and WAVE14 #205437 ©2007 IDC
  22. 22. Authoring and Publishing SoftwareAuthoring and publishing software is defined as software used to create, author, edit,and publish content, including text documents, spreadsheets, presentations, images,audio, video, and XML-structured documents. It does not include the software used todesign Web sites. Authoring and publishing software is further segmented into sixcategories with representative vendors and products:! Office suites include word processors, spreadsheets, and presentation software (e.g., Microsoft Office [not including Access], Corel WordPerfect, and IBM Lotus 1-2-3).! Graphic design and layout includes image editing software, and layout and design software (e.g., Adobe Creative Suite, Apple Aperture, Corel CorelDRAW, and Quark QuarkXPress).! Compound document includes manual XML authoring software as well as software for the automated and semiautomated generation of paginated, structured electronic documents from content components (e.g., Adobe FrameMaker, Adobe LiveCycle, Adobe Central Pro Output Server, JustSystems XMetaL, Exstream Dialogue, PTC Arbortext Advanced Print Publisher and Arbortext Publishing Engine, and StreamServe EDP).! Forms design and input software includes software to design forms and render the forms for display and enter data into the forms but not to route, manage, or process the forms beyond form-level validation or actions (e.g., Adobe LiveCycle Forms, Adobe Acrobat Reader, Autonomy [Cardiff] LiquidOffice Form Designer, IBM [PureEdge] PureXML, and Microsoft InfoPath).! Audio/video (AV) authoring software lets professionals and advanced consumers edit, manipulate, and assemble audio and video content, including the creation of custom professional CDs and DVDs (e.g., Adobes Premiere, Encore DVD, and Audition; Apples Final Cut Pro, Shake, and DVD Studio Pro; Autodesks Max, Maya, and VIZ; and AVID Liquid and Media Composer).! Information diagramming applications provide for the diagramming and visual representation of information (e.g., Microsoft Visio, Mindjet MindManager, and TheBrain BrainEKP).! Other authoring tools include tools for creating learning management systems content, online help, and other types of content (e.g., Adobe Captivate, Adobe RoboHelp).Search and DiscoverySearch and discovery applications create access to unstructured information. Theyalso provide alternative access to structured data. This group of software applicationsanalyzes, tags, and searches text, often in multiple languages, and rich media suchas audio files, video, and image files. This market also includes extended searchplatforms, search engines, question-answering applications, categorization/metadatatagging tools, categorizers and clustering engines, visualization tools for informationnavigation and analysis, filtering and alerting tools text analytics and, beginning in©2007 IDC #205437 15
  23. 23. 2007, translation and globalization software (which were formerly covered as aseparate functional market). The following are the major submarkets andrepresentative vendors for the search and discovery market:! Search engines, platforms, and applications: Autonomy, FAST, Endeca, Google, IBM, Inxight, Coveo, and Vivisimo! Text mining and text analytics: NStein, ClearForest, Insightful, Inxight, Attensity, SAS, and SPSS! Browsing and guided navigation: Endeca and Siderean! Categorizers and clustering engines: NStein, Recommind, Lexalytics, Stratify, and Vivisimo! Question answering: Inxight, NStein, Clearforest, Attensity and InQuira! Language analyzers: Basis Technologies and Inxight! Translation and globalization software: Systran, SDL, Idiom, BasisEnterprise PortalsEnterprise portals integrate access to information and applications and present it tothe business user in a useful format. This software is used by business users butincludes IT administration tools and natively has some level of the followingfunctionality:! Role-based or rule-based administration! Collaboration functionality! Content management and access! Access to structured data such as end-user query and reportingThe following are representative vendors in this market: BEA, IBM, Microsoft, Oracle,SAP, Sun, and Vignette.Enterprise Resource Management ApplicationsEnterprise resource management applications are designed to automate and optimizebusiness processes related to resources required to meet business or organizationalobjectives but are not customer or prospect facing or specialized to various types ofengineering. The resources automated include people, finances, capital, materials,and facilities. The resulting applications forecast, track, route, analyze, and report onthese resources. The market includes software that is specific to certain industries aswell as software that can handle requirements for multiple industries.Definitions of the relevant functional application segments are presented in thefollowing sections.16 #205437 ©2007 IDC
  24. 24. Financial Accounting ApplicationsFinancial applications are designed to support accounting, financial, and treasury andrisk management functions. The financial applications market consists of thesubmarkets discussed in the following sections.AccountingAccounting software supports general financial management business processessuch as accounts payable, accounts receivable, general ledger, and fixed assetaccounting, as well as more specialized functions such as credit and collectionsmanagement and automation, dispute resolution, enterprise spend management,project accounting and costing, tax and revenue management and reporting, nonprofitfund accounting, point of sale, invoicing, electronic bill presentment and payment, andtransactional financial reporting and business intelligence embedded into accountingapplications. The following are representative vendors and products in thissubmarket:! Epicor (Epicor Financials Suite)! Microsoft (accounting modules in Dynamics GP, AX)! Oracle (E-Business Suite Financials)! Sage Software (FAS Fixed Assets)! SAP (financials modules in mySAP ERP 2005)Treasury and Risk ManagementTreasury and risk management applications support corporate treasury operations(including the treasuries of financial services enterprises) with the correspondingfinancial institution functionality and optimize related cash management, dealmanagement, and risk management functions as follows:! Cash management automation includes several treasury processes involving electronic payment authorization, bank relationship management, cash forecasting, and others.! Deal management automation includes processes for the implementation of trading controls, the creation of new instruments, market data interface from manual or third-party sources, and others.! Risk management automation includes performance analysis, Financial Accounting Standard (FAS) 133 compliance, calculation of various metrics used in fixed-income portfolio analysis, market-to-market valuations, and others.The following are representative vendors and products in this submarket:! SunGard eTreasury eXchange (eTx) with AvantGard enterprise applications! Thomson Financial Treasury Solutions©2007 IDC #205437 17
  25. 25. ! Wall Street Systems TreasuryHuman Capital ManagementHuman capital management (HCM) applications software automates businessprocesses that cover the entire span of an employees relationship with thecorporation (as opposed to the department or group to which the employee belongs)as well as management of other human resources used by the enterprise (e.g.,contingent labor, contractors, and consultants), including — increasingly — humanresources employed by suppliers and customers. The center of the HCM applicationssuite is designed for core HR functions such as personnel records, benefitsadministration, and compensation. Increasingly, these functions are being deliveredas employee self-service or manager self-service in order to automate record keepingand updating as well as consolidated reporting. The following are representative coreHR applications vendors:! Kronos Workforce HR, Employee, Manager! Lawson Human Capital Management! Oracle Enterprise HCM Suite! SAP Human Capital Management! Ultimate Software UltiproGlobalization, flexible work rules, job mobility, and the strategic importance of peopleassets have forced organizations to transform their human resources systems into amore real-time, personalized, and operational intelligence business function that goesbeyond the traditional view of aggregating personnel data. Core HR functions arebeing supplemented by extensions that form the basis of a new generation of HCMapplications framework. The extensions are categorized in four major segments orsubmarkets: erecruiting, incentive management, performance management, andworkforce management. Increasingly, core HR applications are also adding selectiveand functional-equivalent features of these HCM extensions to meet changingcustomer requirements. The following sections describe the functional aspects ofthese HCM extensions.eRecruitingeRecruiting applications are designed to automate the recruitment process throughbetter tracking of applicants, screening and skills assessment, profiling and resumeprocessing, and identifying talents inside or outside the organization.Key features include:! Managing skills inventories! Creating and managing job requisitions! Identifying appropriate employment candidates18 #205437 ©2007 IDC
  26. 26. ! Coordinating team collaboration within hiring processes! Facilitating resource planning! Deploying workers to appropriate jobs, projects, or teamsRepresentative erecruiting applications include:! Kronos Workforce Acquisition! Peopleclick Recruitment Management! Taleo Enterprise Staffing ManagementIncentive ManagementIncentive management applications are designed to automate the process ofproviding cash and noncash incentives to employees, partners, and external usersthrough advanced modeling, reporting, and built-in interfacing to payroll processingsystems.Key features include:! Quota and territory management! Calculation and distribution of commissions, spiffs, royalties, incentives to employees, and channel and business partners! Compensation analysis using internal and external data for retention risk analysis! Linking incentives — cash and noncash — to business objectives! Payroll and payment engine interfaces! Account payables integrationRepresentative incentive management applications include:! Authoria Compensation Advisor! Callidus TrueComp! Synygy EIMHR Performance ManagementHR performance management applications are designed to automate the aggregationand delivery of information pertinent to the linking of job roles and the mission andgoals of the organization. More specifically, the system allows users to automate theperformance review process by using mechanisms such as training and keyperformance indicators (KPIs) to constantly track and monitor the progress of anindividual employee, work team, and division.©2007 IDC #205437 19
  27. 27. Key features include:! Assessment of individual and organizational skills gaps that impede performance and job advancement, as in ability testing! Continuous reviews and establishing milestones! 360-degree evaluation and real-time feedback! Performance appraisal automation! Competency assessment and management! Goal setting and tracking! Employee surveys! Alignment of human assets to corporate objectives! Learning development and career improvement programs! Fast tracks for top performers! Delivering training based on certification requirements! Succession planningRepresentative performance management applications include:! Kenexa Career Tracker! SHL Group Objective Assessment! Witness Systems Equality Contact StoreWorkforce ManagementWorkforce management applications are designed to automate the deployment of theworkforce through workload planning, scheduling, time and attendance tracking,resource management, and rules and compliance management. Increasingly,workforce management applications are being integrated into customer relationshipmanagement applications in a contact center environment. Through extensive use ofworkforce management applications, organizations are also able to develop trainingguidelines, career advancement plans, and incentive compensation programs toimprove, motivate, and sustain the quality of their employees.Key features include:! Skills and certification tracking! Shift/vacation bidding! Workload planning, forecasting, and scheduling20 #205437 ©2007 IDC
  28. 28. ! Scheduling optimization! Customer wait-time forecasts! Coverage management! Absence management! Labor activity tracking! Rationalization of revenue per full-time equivalent! Cost of sales activities! Sales resource planning based on local and regional opportunitiesRepresentative workforce management applications include:! Eclipsys Sunrise Enterprise Scheduling! Kaba Benzing B-Comm for R/3, Enterprise Data Collection! Kronos Workforce Central! Witness Blue Pumpkin Director Enterprise, Activity Manager, Advisor Express! Workbrain Enterprise Workforce ManagementPayrollThe functionality involves payroll processing and other labor-related payments,including tracking of stock-option compensation and other variable and nonvariablepayments. The following are representative vendors and products in this market:! CBS Payroll from Intuit! Oracle Enterprise HCM and Global Payroll! Ultimate UltiPro Payroll Administration and Tax ManagementProcurementProcurement applications automate business processes relating to purchasingmaterial (whether direct or indirect; raw, in process, or finished; as a result of orflowing into a product supply chain–specific business process; or in support ofperforming a service) and services (business or professional). With the advent of theInternet, the procurement function is being expanded to cover Web-based sourcing,procurement, transaction processing, and payment support, all of which areconnected to create a single view of the spending levels at a company. As a result,purchasing activities are integrated into a supplier community that can be easilytracked, benchmarked, and analyzed by both buyers and suppliers.Existing and upcoming features of these procurement modules include:©2007 IDC #205437 21
  29. 29. ! eProcurement! Self-service requisitioning! Order entry (PO email)! Approvals, workflow! Transaction processing, EDI, EDI-INT! Procuring configurations! Global agreements, time-phased pricing, mass update price! eSourcing! Strategic sourcing! Dynamic pricing! eRFX! Product design management! Commodity strategy, spot buying! Contract compliance! Contract library! Contract management, tracking, enforcement! Content management! Standardization, function equivalent! Consolidated buy/group purchasing organizations! Data synchronization and management! Item master cleansing! Category management for commodity buying! Catalog aggregation, syndication! Supplier performance management! Supplier enablement, portal! Vendor-managed inventory support! Supplier performance tracking22 #205437 ©2007 IDC
  30. 30. ! Supplier consolidation! Supplier satisfaction metrics! Machine-to-machine connection such as EDI exchanges! Electronic invoice presentment and payment/dispute resolution! Volume discount discovery! Consolidation of accounts! Invoice, PO, multiple document matching! Standard applications templates for exceptions handling! Procurement analytics! Integrated analyticsThe following are representative vendors and products in this market:! Ariba (Enterprise Spend Management)! Infor (SmartStream Procurement)! Lawson (M3 Procurement)! Oracle (Oracle Advanced Procurement)! SAP (mySAP SRM)Order ManagementOrder management applications are designed to automate sales order processingfrom capture to invoice and settlement as well as built-in features to handle orderplanning and demand management capabilities. Item lookup and order placement arethe prerequisites of order management applications, followed by issuance of receiptsand advance shipping notices as well as payment processing functions. Increasingly,Web-based order management applications are replacing legacy systems for fasterand more accurate order processing. Order and product configurations, as well aspricing options, freight calculation, and credit checking, are being combined to forman integrated order management application, regardless of the sales channels.Other features include view price history, profit management, multiple order types(including quotes and credit orders), blanket and release orders, direct ship andtransfer orders, kit processing, and product returns processing.The following are representative vendors and products in this market:! Comergent (Ebusiness Suite Order Management)! Manhattan Associates (Distributed Order Management)©2007 IDC #205437 23
  31. 31. ! Oracle (Enterprise One Sales Order Management)Financial Performance and Strategy Management ApplicationsThe financial performance and strategy management applications market consists ofcross-industry applications whose main purpose is to measure, analyze, and optimizefinancial performance management processes using prepackaged applications thatinclude the following:! Budgeting and planning includes applications to support operational budgeting processes, corporate budget consolidation and adjustment processes, and planning and forecasting processes.! Financial consolidation includes applications that support both statutory and management financial consolidation, reporting, and adjustment processes across multiple entities and divisions.! Profitability management and activity-based costing applications include packaged applications to support detailed cost and profitability measurement and reporting processes.! Strategy management applications include those that support a closed-loop performance management strategy such as the balanced scorecard. Strategy management applications incorporate domain expertise across a range of business processes, such as finance, human resources, operations, and CRM, but enable strategic management processes rather than performance management reporting processes of these functions.The following are representative vendors and products in this market:! Cartesis (Financial Control and Reporting)! Hyperion (such as Financial Management, Planning, and Customer Profitability)! Longview (Budgeting/Planning/Forecasting)! Oracle (Enterprise Planning and Budgeting)! PerformanceSoft (formerly Panorama Business Views [pbviews])! SAP (SEM)! SAS (Financial Intelligence and Performance Management)Project and Portfolio ManagementProject and portfolio management (PPM) applications are used for automating andoptimizing the initiating, planning/scheduling, allocation, monitoring, and measuring ofactivities and resources required to complete projects. In addition, the portfoliomanagement capabilities enable the tracking of an aggregation of project, products,programs, and/or initiatives to oversee resource allocation, for making ongoinginvestment and prioritization decisions, and to track risks — as part of an overallportfolio. Ultimately, PPM applications help organizations to manage the scope, time,and cost of discrete sets of related people processes (projects) on an individual and24 #205437 ©2007 IDC
  32. 32. portfolio basis. IDC uses a wide definition of PPM to include the breadth of solutionsthat use PPM features at their core, such as construction/architectural/engineeringmanagement (AEC), asset/capital management (A/C), IT project portfolio management(ITPPM), new product development/introduction management (NPDI), professionalservice automation (PSA), and other industry-oriented solutions developed around theprimary premise of successful "project" completion as the main business purpose. Thefollowing are representative vendors and products in this market:! CA Clarity Portfolio Manager and Clarity Project Manager (former Niku)! Deltek Vision! Meridian Proliance! Microsoft Office Project! Oracle Projects! Primavera Project Management! PTC ProjectLink! SAP xRPM (Resource and Portfolio Management)Enterprise Asset ManagementEnterprise asset management application software automates the many aspects ofasset management and maintenance, repair, and overhaul (MRO) operations (e.g.,machinery and equipment, buildings, or grounds). The software generally includesfunctionality for planning, organizing, and implementing maintenance activities,whether they are performed by employees of the enterprise or by a contractor.Typical features include equipment-history record management, descriptions of itemsmaintained, scheduling, preventive and predictive maintenance on the assets, workorder management, labor tracking (if integrated within the maintenance managementapplications), spare parts management, and maintenance reporting. The following arerepresentative vendors and products in this market:! Avexus! IBM Tivoli MAXIMO! Indus InternationalSupply Chain Management ApplicationsSupply chain management application software automates supply- and demand-sidebusiness processes that bring a product or service to market, including multisiteorganizations involved in a complex supply chain process, including raw materialssuppliers, contract manufacturers, 3PL and 4PL providers, and individualtransportation and warehousing organizations. Definitions of the relevant functionalapplication markets are presented in the following sections.©2007 IDC #205437 25
  33. 33. LogisticsLogistics application software automates activities relating to moving inventory ormaterials of any type. Examples include software that automates distribution resourceplanning, warehouse management, and transportation planning business processesthat are not specific to an industry. (Logistics applications specific to thetransportation industry are included in the services operations managementapplications market.) The following are representative vendors and products in thismarket:! Four Soft, 4S eTrans, and 4S i.Logistics Drive! JPMorgan Chase Vastera, Tradesphere products! Manhattan Associates, Transportation Management, Carrier Management, Reverse Logistics Management, and Trading Partner Management! RedPrairie, Optimized Transportation, Global Trade Management, In-Transit Control, Freight SettlementProduction PlanningProduction planning (PP) applications software automates activities related to thecollaborative forecast and continuous optimization of manufacturing processes. PPapplications span supply planning, demand planning, and production planning withinorganizations. These applications identify demand signals, aggregate historical datathat informs short- and long-term demand expectations, and provide suppliercapabilities across multiple manufacturing sites. Production planning applicationsoftware is key to any supply chain management initiative because supply anddemand planning dictates the rest of the supply chain activities. The following arerepresentative vendors and products in this market:! Aspen Supply Planner and Aspen Plant Scheduler! Oracle Advanced Planning and Scheduling (APS)! SAP Advanced Planning and Optimization (APO)Inventory ManagementInventory management application software automates activities relating to managingphysical inventory, whether direct or indirect; raw, in process, or finished; as a resultof or flowing into a product supply chain–specific business process; or in support ofperforming a service. This includes inventory control/materials management businessprocesses in any industry, not just in manufacturing. The following are representativevendors and products in this market:! Catalyst CatalystCommand Warehouse Management! SAP Inventory Management! SmartOps Multistage Inventory Planning and Optimization26 #205437 ©2007 IDC
  34. 34. ! SSA Global (acquired by Infor in 2006) SCM Warehouse ManagementOperations and Manufacturing ApplicationsOperations and manufacturing applications are enterprise applications that automateand optimize processes related to planning and execution of services operations andmanufacturing activities, as well as other back-office activities. The resourcesautomated include people, capital, materials, and facilities. The applications track,route, analyze, and report on these resources. The market includes software that isspecific to services, manufacturing, and other industries. Definitions of the relevantfunctional application segments are presented in the following sections.Services Operations ManagementServices operations management applications support the services supply chain andare unique to particular industries. These industry-specific applications cover a broadrange of activities such as automating claim processes (as applied to insurancefunctions), automating admissions/discharges and transfers of patients (as applied tohealthcare functions), or automating energy trading (as applied to energy and utilityfunctions). Other examples of industry-specific applications are those that enable theautomation of real estate, business, legal services, banking and finance, education,government, social services, and transportation. The following are representativevendors and products in this market:! ADP (Claims Services applications)! Cerner Corp. (Millennium)! SunGard (Entegrate applications)ManufacturingFunctional applications in manufacturing include material and capacity requirementsplanning (MRP), bills of materials (BOMs), recipe management, manufacturingprocess planning and simulation, work order generation and reporting, shop floorcontrol, quality control and tolerance analysis, and other functions specific tomanufacturing execution (MES). The category does not include computer-aidedmanufacturing (CAM) applications for NC and CMM machine programming.(Advanced planning and scheduling applications are included in the supply chainplanning functional market.) Representative vendors and products in this market are:! Aspen Technology aspenONE solutions! Dassault/DELMIA production process planning and simulation applications! UGS/Tecnomatix Assembly PlanningOther Back OfficeOther back-office applications include various types of application automatingfunctions not otherwise covered previously, such as computer-based training,elearning applications, speech and natural language, and environmental health andsafety applications. These applications also cover a wide range of point solutions for©2007 IDC #205437 27
  35. 35. product-related applications other than services operations management andmanufacturing. These applications have at their core a product orientation focused onefficiencies related to item maintenance, replenishment, and site management.Among them are retail-specific and wholesale-specific applications. Representativevendors and products in this market are:! JDA Software Portfolio Solutions! NSB Retail Systems Connected Retailer Solutions! Oracle Retail Merchandise Operations Management! SAP EH&SEngineering ApplicationsEngineering applications automate all of the business processes and datamanagement activities specific to ideas management, concept planning, and designand the handoff of a design to execution (manufacturing, construction, or other). Themarkets include mechanical computer-aided design (MCAD), CAM, computer-aidedengineering (CAE), product information management (PIM), and other engineeringapplications, which include those for electronic design automation (EDA) andarchitecture/engineering/construction (AEC). Definitions of the engineering applicationsegments are presented in the following sections.Mechanical Computer-Aided DesignMCAD software is utilized for tasks typically performed by designers and drafters.Specifically, this category includes computer-assisted designing, drafting, andmodeling (wire frame, surface, and solid). MCAD also includes conceptual designand/or industrial design, animation and visualization, and assembly design. (Lightgeometry visualization such as UGS JT, Agiles AutoVue, or Autodesks DWF isincluded in PIM.) The following are representative vendors and products in thismarket:! Dassault Systèmes Catia and SolidWorks applications! PTC Pro/Engineer applications! UGS NX and Velocity applicationsMechanical Computer-Aided EngineeringMechanical CAE applications address tasks such as structural/stress analysis,kinematics, fluid dynamics, thermal analysis, and test data analysis. The following arerepresentative vendors and products in this market:! ANSYS analysis products! Moldflow Corp. plastic moldflow analysis! MSC Software NASTRAN and PATRAN analysis products28 #205437 ©2007 IDC
  36. 36. Mechanical Computer-Aided ManufacturingMechanical CAM applications prepare data for actual production on the shop floor(e.g., NC tape generation and data for CNC machines). The following arerepresentative vendors and products in this market:! CimatronE NC! CNC Software MasterCAM! UGS CAM applicationsProduct Information ManagementPIM applications provide engineering groups, but also increasingly cross-disciplinaryteams across the enterprise as well as outside of its four walls, with software tools toelectronically coordinate, manage, and share product data throughout the product lifecycle. The major subsegments of this market are product data vaulting, documentmanagement, light geometry with view/markup capabilities, change management,and parts libraries. Ideas management and product-focused environmentalcompliance management are now emerging as additional application subsegments.The following are representative vendors and products in this market:! Agile Software Autovue product line! IDe IdeWeb for idea and innovation management! UGS TeamCenterNote: The aggregation of MCAD, CAE, CAM, and PIM applications is termed thecollaborative product development applications market by IDC.Other EngineeringOther engineering applications support electronic design automation,architectural/engineering/construction, and other engineering functions. AECapplications software automates drawing/design of building- and civil engineering–related projects. (AEC project and portfolio planning and facilities management arepart of the project and portfolio management functional market.) The following arerepresentative vendors and products in this market:! Autodesk civil engineering applications! Bentley Systems civil engineering applicationsEDA application software includes applications for component and board/systemsdesign. Functions include simulation, design creation, synthesis, layout, designverification, and analysis. Representative vendors and products in this market includeapplications from Cadence, Mentor, and Synopsys. (IDC does not provide detailedfunctional analysis of the EDA applications market.)©2007 IDC #205437 29

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