Cognos and Oracle provide the best combination of strategy and current offering in the business process solutions (BPS) market, according to the latest Forrester Wave rankings from Forrester Research. The BPS space, as Forrester defines it, parallels the market more commonly referred to as business process management.
Of the 10 vendors appearing in the Forrester Wave: Business Performance Solutions, Q4 '07, Oracle is bumping up against Cognos in the Leader section, with Cognos having the edge in terms of current offering but lagging slightly behind in strategy. The two companies are not alone in the Leader segment of the Wave, however: SAS Institute trails closely, and Business Objects also resides in that same upper-right corner of the field. Just across the line in the Strong Performers segment is SAP, which last week announced plans to acquire Business Objects. Other vendors ranked in the Wave include Applix, Microsoft, Clarity Systems, Longview Solutions, and Infor.
"Adoption of applications for planning, measuring, and reporting business performance is growing rapidly as companies focus on aligning their growth and operating strategies with individual performance metrics and compliance requirements," writes Paul Hamerman, vice president of enterprise applications at Forrester and author of the report. BPS is the header under which Forrester groups such purpose-built applications, which aim to address three key business needs:
- Forecast and analyze performance across the enterprise;
- Align strategic and tactical goals with performance metrics; and
- Make actionable performance information more accessible.
Hamerman notes two main trends in his report: market growth and vendor consolidation. Of the two factors, the amount of consolidation activity in the BPS market space is the one most clouding long-term predictions. In fact, the report comes a time of major flux in the marketplace, appearing amid last week's acquisition news from SAP and Business Objects (as well as Oracle's offer for middleware vendor BEA Systems, which had itself acquired BPM vendor Fuego last year) and roughly a month after two other major deals: Cognos' plans to purchase fellow BPM (or "BPS") vendor Applix, and Longview's acquisition by Exact Software. Infor, on the other hand, has publicly put its ravenous multiyear acquisition binge on hiatus.
"The vendor landscape for BPS continues to evolve towards fewer vendors with broader offerings, as point-solution vendors are swallowed up by larger players," Hamerman writes. "Recent vendor acquisition activity reflects this trend." In addition to those previously mentioned, the Forrester report cites Oracle's April 2007 acquisition of Hyperion Solutions, SAP's acquisitions of OutlookSoft and Pilot Software, and the acquisitions by Business Objects of Cartesis in June 2007 and ALG Software in October 2006.
The 2006 business performance solutions market was estimated at nearly $900 million in product license and subscription revenues, according to the report. "Forrester expects this market to grow at a healthy 11 percent rate through 2010, resulting in a $1.4 billion market," Hamerman writes. "Based on our client inquiries and analysis of the market, we expect planning, budgeting, and forecasting to remain the largest application component of BPS, growing at a rate of 12 percent through 2010. Strategy and performance measurement, though less mature in terms of customer adoption and solution strength, has higher growth potential at 16 percent."
On-demand applications -- sometimes referred to as software-as-a-service (SaaS) -- aren't much of a factor in BPS at present, according to Forrester. "[Customers] typically require the solutions to be installed on-premise to optimize integration and design flexibility," Hamerman writes. "As a result, SaaS offerings from the vendors included in this Forrester Wave report are virtually nonexistent, although we expect to see some demand for SaaS in BPS going forward."
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