Dashboards and similar tech tools within the performance management sector are growing in popularity, according to a new survey by AMR Research.
Overall performance management spending will increase to nearly US$23 billion in 2006, forecasts the firm’s report, “Trends in Performance Management Spending, 2006.”
Within that category, the dashboard and scorecard segment will grow to $5.22 billion in 2006 — a growth rate of 26 percent. Business intelligence applications are expected to reach $6.35 billion with a growth rate of 10 percent.
Decline in Analytics
The growth in these two subsectors will likely come at the expense of other areas; survey respondents indicated that they planned to spend less on analytics. Spending in the analytics applications category will drop substantially, the report found — by 17 percent. Analytics infrastructure spending is forecast to decrease by 4 percent, a more moderate decline.
The planning, budgeting and forecasting (PBF) segment, although still viewed by respondents as the most strategically important PM investment for 2006, will also experience a slight decline in 2006 — reaching $4.01 billion compared to $4.14 billion in 2005.
There is still interest in these latter categories, said John Hagerty, vice president, research, at AMR Research. This is especially true for analytics, which he described as a finished product built around certain content, such as customer data or supply chain data, as opposed to a tool or technology that can access such data.
Companies still inquire about analytics, he told CRM Buyer. “However the spending appears to be shifting to a tools approach right now.”
Dashboards Lead the Way
Chief among these are dashboards — user interfaces that illustrate in graphical or numeric form certain key performance metrics, such as sales in the pipeline.
As with most emerging technologies, the vendors in this space are very diffuse, ranging from enterprise vendors that have incorporated dashboards into their suites to best-of-breed providers.
It is too soon to tell which category of provider will come to dominate the space, Hagerty said. “It is getting to be a very competitive industry. If the enterprise and platform providers continue to juice up their offerings, they will cause some angst for the best-of-breed vendors.”
Emerging Software as a Service Model
Meanwhile, a third option is forming on the horizon that could further shake up the space. Some 17 percent to 23 percent of respondents said they would prefer a software-as-a-service or an on-demand purchase option.
Many SaaS vendors do offer dashboards, such as NetSuite. There are alsostand-alone vendors offering business intelligence applications such as SeaTab and Oco. Some retailers are using these firms as de facto outsourcers, Hagerty said.
“Retail data is notoriously complex. We are seeing some companies bypassing their own IT operations and sending it to companies for a monthly fee,” he observed.