The global business software and services market is expected to grow over the forecast period, primarily owing to the need for transparency and efficiency in organizations. Factors including better operational efficiency, shrunken production costs, and timely product delivery are expected to drive market demand over the forecast period. In addition, the need for streamlined processing in businesses will contribute to growing demand from the aerospace and defense industry as well as government services.
Business or enterprise software and services facilitate the integration of numerous processes within an organization and enable the smooth flow of information across functions, thus allowing improved decision-making and productivity. These software solutions offer flexibility in helping large companies achieve their data security needs as well as giving them easy and quick access to an unstructured database. Business software implementation in an enterprise can lead to substantial reduction of inventory and raw material costs, which help the firm achieve increased profitability, thus propelling demand. Penetration of cloud-based services, technological innovations, software development, new data sources and competitive pressures are further estimated to spur growth in the future. The mechanical movement towards improving data portability, rules and business standards and the growing requirement for mobility are anticipated to put more emphasis on data-centric solutions and further lead to the development of the business software and services market. Furthermore, compliance with stringent government regulations in different industries has assisted the implementation of such software, which can help improve productivity and minimize complexity.
Many large-scale industries are expected to make investments in order modernize and consolidate their IT infrastructure, which will provide growth opportunities for the business software industry in the future. Increasing network complexity in organizations is also expected to provide opportunities for expansion.
Any unauthorized person may access data using the software, which has led to security concerns, and may deter further adoption of the software and hamper market expansion. There is a distinct lack of standardization in the industry, which will also pose challenges for growth. The high cost of implementation and a high level of competition within the market will act as restraints for the industry.
The business software industry is segmented based on functions including finance, human resource, and supply chain. The finance function will account for maximum share as the software makes it easy to manage the different financial activities including investment, accounting, asset management and cash flow management. The human resource function is expected to show maximum growth over the forecast period owing to the organization needs of rapidly expanding companies.
The industry can be classified on the basis of end-use including manufacturing companies, retail, cloud and telecommunication service providers,(BFSI) companies, healthcare sector and the government. The manufacturing sector will represent the largest consumer in this market as enterprise software effectively manages and monitors daily operations and performances along with inventory management, real-time data tracking and production scheduling. These factors will drive industry growth in the near future.
Business software can also be segmented on the mode of deployment namely on-premise and cloud. The on-premise deployment will account for the largest market share and drive the industry for the next eight years as it offers continuous control and security of data in an organization. Cloud deployment is expected to be the fastest growing mode on account of various benefits provided by it including small infrastructure requirement and the capability to integrate with other mobile devices.
North America will be the biggest market for business software on account of rapid technological advancement as well as the presence of several operators in the region. In addition, the innovative application of such software in mobile devices is anticipated to augment demand over the next eight years. Asia Pacific is expected to witness the fastest growth over the next eight years on account of a rapidly expanding manufacturing sector and government support for the implementation of IT infrastructure. An increasing number of small and medium enterprises in developing countries especially Brazil, China, and India is expected to augment demand over the next eight years. Moreover, the proliferation of IT companies in these regions is anticipated to transform consumer behavior, leading to intensified adoption of the business software in place of manual operations. A large number of firms are expected to implement on-premise solutions in an effort to improve performance and productivity, leading to increasing sales.
Key players include IBM Corporation, Oracle Corporation, Microsoft Corporation, Infor, SAP SE, NetSuite Inc., Unit4, Totvs S.A., and Syspro. Various strategies adopted by major companies to maintain global share include mergers and acquisition, collaboration, entering new markets, technological innovations and new product development and technical advancements. IBM and Microsoft are collaborating to provide their software on IBM Cloud as well as Microsoft Azure.
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