What End Users Need From Application Providers

InterSystems DEVCON 2009 Sandra Rogers, IDC

March 22, 2009

2009 IDC

Mar-09

Application Needs Study

Primary research and analysis
What are top strategic goals of end-user organizations What are organizations looking for from their

applications and application providers

What types of investments are being planned What are critical vendor and application decision

criteria

What are application ISVs experiencing and hearing

from customers?

What should vendors focus on most?

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Top Strategic Business Goals:

Cost Control, Tech, and Process Efficiency
Better Manage Costs Improve Technology Infrastructure Increase Process Efficiency Improve Customer Relations Enable Greater Employee Productivity Increase Speed to Market with New/Changed Product Offerings Drive Product Innovation Increase Market Visibility and Awareness Optimize Supply Chain Address Compliance, Fraud, and/or Risk Management Restructure Organization or Business Lines Attend to Merger & Acquisition Activity

N=105 Q. Which of the following relate to your organizations top strategic business goals for the next 12-24 months? Select Top 3 Source: IDC, March 2009
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Resource and Organizational Concerns:

How Can Vendors Help?
Resource and budget constraints

Navigating organizational issues and dynamics

Addressing compliance and regulatory concerns Large number of disconnected processes and applications to be integrated and optimized Need for cross-enterprise information agreement and consistency Ability to keep up with changing business rules and requirements Getting stakeholders the right access to current information

IT processes informa Business users associate value the information itself

Staff skill set may not be adequate for required tasks

0 10 20 30 40 50 60

N=105 Q. What are your organization's most critical concerns in achieving these goals? Select Top 3 Source: IDC, March 2009
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Close the Gap!

Pressure to Change
Economy Competition Heightened Customer Expectations Globalization Regulatory Compliance Shifting Worker Dynamics Uncertainty Quotient

Barriers to Change
Budget and Resources Culture Deciphering Where to Focus Lack of Management and Governance Best Practices Regulatory Compliance Risk Aversion

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Overcoming Slow Rate of Change

Acknowledge Need to Change however must ...
Free Up RESOURCES So They Can ADDRESS Change Reduce COMPLEXITY of Change Provide GREATER INSIGHT as to WHERE to Change Navigate ORGANIZATIONAL BARRIERS to Change Provide INCREMENTAL AVENUES for Change Reduce RISK of Change Increase VALUE of Change

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Decisions Decisions

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Desperately Seeking
Q: Please tell us what your organization will look for most from your application vendors in the next 12 to 24 months? Ways for monitor productivity and reduce costs Easy to integrate software Excellent support and competitive pricing High speed, accuracy, dependable, reliable More bang for the buck and better integration with existing apps Cost effectiveness, reliability, security Improved reliability, better visibility into our business within application, better integration with other apps

The ability to integrate separate applications together to reduce the number of systems needed and the amount of training required to get work done

2009 IDC

Mar-09

Desperately Seeking
Q: Please tell us what your organization will look for most from your application vendors in the next 12 to 24 months? Feature set that meets our requirements, flexibility, scalability, cost, infrastructure, etc. Lower costs, application stability and support more time between upgrades Great customer service skills In this economy it's really going to come down to cost for the most part

Financial stability. Ability to assist integration of information across platforms and geographies anticipate regulatory requirements and changes be somewhat cost effective in doing so a low price customization to improve productivity make their databases or information more compatible or easily importable into other applications so that we can process the data as we need to, when we need to, without having to divest large amounts of time to be able to decipher
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Mixed IT Activities:
Most Prominent Mode is Leverage
Maintain/enhance existing custom app code

Integrate existing applications and processes

Upgrade to new versions of existing apps

Implement new packaged applications Address information access, reporting, and business intelligence projects Enhance/customize packaged applications

Develop new custom applications

0 4 8 12 16 20

N=105 Q. Please distribute your organization's current IT efforts among the following activities in terms of overall resource hours (mean) Source: IDC, March 2009
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Application Plans: Extend and Leverage

Current Opportunity
Extend existing vendor-based apps with value-added capabilities Upgrade vendor-based apps to newer versions Maintain/extend custom-build applications with value-added capabilities Replace custom-build with vendor-based apps Consolidate vendor-based apps Maintain vendor-based apps exactly as they exist today Replace vendor-based apps with different vendors' offerings Replace vendor-based apps with custom-built applications
0% 20% 40% 60% 80% 100%

Future Risk

Currently Implementing

Planning Implementation in next 12-24 months

Investigating

No Plans

N=105 Q. Which of the following does your organization plan to start or continue in the next 12-24 months? Source: IDC, March 2009
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Where and How to Add Value?

As a business partner as well as through product offerings Listen to their needs and treat them as individual entities Be flexible in pricing, packaging, and support Incremental change can lead to greater change overall Be careful about promises Extend overt value to their end customers

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Application Vendor Decision Criteria:

3 Rs Requirements, Relationship, & Risk Mgt
Better features/functionality than competitors Better or more flexible pricing and licensing terms Better service/support than competitors Long-term vendor viability/financial stability Strong understanding of my specific industry and business environment Product roadmap best fits our needs Strong technical knowledge Pre-existing relationship with vendor Provides an integrated suite of offerings Has a strong ecosystem of partners
0 10 20 30 40 50

How run the business

The product and service

Incumbency and size = guarantee

N=105 Q. When you evaluate one enterprise application vendor against another, which of the following criteria are likely to be the most important in your buying decisions over the next 12-24 months? Select Top 3 Source: IDC, March 2009
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Application Selection Priorities

Onus on Vendors to Solve Integration Needs
Integration Tops Cost!
Easy to integrate with existing systems Most cost effective Easy to customize to our changing needs Ease of use Scalability and high performance capabilities Runs on our preferred platforms/technologies Faster to implement Provides industry specific configurations Strong vendor reputation Ability to use existing skill sets with IT department Ability to handle complex data types
0 10 20 30 40 50

N=105

Q. Which of the following features will be most important to your application selection process over the next 12-24 months (aside from specific business logic functionality)? Select Top 3 Source: IDC, March 2009
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Critical Concerns for App Purchases:

Performance/Scalability; Extendibility, and Integration
Performance and scalability of the application to meet growing and changing business needs Challenge in extending business logic or lack of flexibility with application parameters Challenge of integrating application with internal applications Challenge of integrating application with external applications Architecture needed to address web and service-based computing requirements Ability to address different application client interfaces and devices Lack of visibility and control of underlying data structures Specialized skills required to work with the vendor's proprietary tools and languages
0 10 20 30 40 50 60

Investing for the future .. Todays solutions need to evolve much more gracefully

N=105 Q. Which of the following are the most critical concerns regarding the purchase of packaged application? Select Top 3 Source: IDC, March 2009
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Embedding Capabilities for Value

Decrease amount of technical integration and interoperability barriers

by

moving capabilities INTO the application

Address manual steps and desktop maneuvers Think beyond information processed to

the and

value of the artifacts from the systems processes themselves

Gain control of focus and activities of the

end user become the go to place for intersection of information & processes

the

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Embedded Capabilities within Applications

Integration and Real-time Business Intelligence
Native integration capabilities to easily connect with other applications and systems Real-time business intelligence (i.e., views of current operational data) Configurable business rules engine to easily change policies and parameters Configurable custom or rolebased views for users Configurable workflow engine to automate and optimize processes
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Extremely Important

Q. Please rate how important it is to your organization that each of the following features be an embedded capability within your application vendors transactional applications -- Top 3 Ranking on Scale of 10 Source: IDC, March 2009
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Value of Embedded Integration:

Cost and Efficiencies First and Foremost
Greater cost efficiencies More efficient business processes Better information quality Faster application deployment Address new business opportunities and models Ability to gain a more unified view of the customer, product, etc. Better enterprise-level business insight and visibility Easier application customization Ability to better collaborate with partners or suppliers Ability to address business change more readily Better customer care

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Q. If your transactional applications could automatically embed integration capabilities, meaning they would easily connect to other systems, which of the following would be the most valuable benefits to your organization? Select Top 3 Source: IDC, March 2009
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Value of Embedded Business Intelligence:

Think Operationally
Faster/enhanced operational decision-making capabilities Operational efficiencies Data quality improvements Perform interactive analysis on real-time data Unified view of customers, business performance, etc. Real-time performance, risk, and/or fraud notifications Leverage and integrate structured data and unstructured data Address management policy or best practice guidance Automated exception management embedded in applications Regulatory/compliance-related auditing or reporting Support for collaborative or project-based knowledge sharing activities Ability to share current business intelligence with partners or customers

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N=105 Q. If your transactional applications could provide users with real-time operational business intelligence as an embedded feature, which of the following would be the most valuable benefits to your organization? Select Top 3 Source: IDC, March 2009
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Still Addressing Building Blocks:

Information Access and Process Insight
Information search and mining Business activity monitoring Event-driven notifications based on business rules Interactive dashboards Event-driven analytical views Predictive analytical views Interactive information visualization KPIs and/or scorecard views Information mashups
7 7.2 7.4 7.6 7.8 8 8.2 8.4

N=105 Q Please indicate the criticality of leveraging the following capabilities within your operational applications over the next 12-24 months Source: IDC, March 2009
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INCREMENTALLY Drive Change To Overcome Barriers

Package and position solutions to help:
Address change on all fronts organizationally as well as technically Empower end-users to influence, accept, innovate, and change on their own

terms
Address user workspaces bring the desktop into the application Target small, incremental process changes that can

produce big rewards

Advise and guide businesses on where to focus Optimize versus merely automate

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Staying Relevant During Turbulent Times

Help customers drive greater value from existing investments Simplify technical complexities of deployment and integration Ensure credibility and viability during times of change Support flexible pricing and deployment options Eliminate the burden and reduce the risk
Develop and showcase preconfigured views, data models, process
models, integration templates, and more

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What End Users Need From Application Providers

InterSystems DEVCON 2009 Sandra Rogers, IDC
March 22, 2009

Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved.