APAC Enterprises Moving Towards Software Consolidation: Springboard

More than 70% of enterprises in Asia Pacific (excluding Japan) are looking for ways to consolidate their enterprise software portfolio within the next three years, says the latest research study from Springboard Research, a leading innovator in the IT market research industry. Springboard’s latest study titled, “Enterprise Software Adoption in Asia Pacific: Trends, Opportunities and Threats,” adds that the overall trend towards market convergence and consolidation around ‘mega-vendors’ platforms is continuing.

The study also reveals that the top enterprise software classes considered as strategic by APEJ (Asia Pacific Excluding Japan) enterprises are Operating Systems, ERP, Security and CRM respectively. While 86% of the respondent organisations in the region consider enterprise applications to be part of their strategic software infrastructure, only 38% consider mainframes and/or mainframe-based applications and systems to be part of this infrastructure. Findings in this report are based on interviews with 442 CIOs, IT managers and business managers at large and SMB enterprises in Australia, China, India, Malaysia, New Zealand, the Philippines and Singapore.

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“From a business perspective, the primary drivers for improved software portfolio management all link directly to reducing costs and complexity,” said Michael Barnes, Vice President - Software Research at Springboard Research. “Given the weak economy – both globally and across the region – we expect this to remain the case for the next 12-18 months, and possibly longer,” Barnes added.

The study noted that the ongoing consolidation in the enterprise software market will likely continue, as an overwhelming majority of organisations consider between 1-4 vendors to be ‘strategic providers’, critical to their ongoing operations. In terms of primary criteria for vendor selection, depth and quality of functionality is rated as most important by study respondents, followed by local presence and price. The study also found that across Asia Pacific, less than 40% of organisations consider their existing software vendor relationships when undertaking architectural planning or making purchase decisions.

Springboard’s study reveals that the majority of organisations make architectural planning decisions based on factors other than existing investments (e.g., sunk costs) or existing vendor relationships.

“While incumbent vendors clearly have an advantage in terms of impacting organisations’ decisions-making process, this advantage is not insurmountable since the majority of respondents make decisions based on other factors,” Barnes said.

However, for the respondents who consider existing relationships when making architectural planning and/or product purchase decisions, Microsoft leads, followed by IBM, with HP and Oracle tied at third place. In terms of mindshare as well, Microsoft scored the highest ranking, followed by IBM and Oracle.