ENTERPRISE SOFTWARE: Yet to Make Headway

Mostly
dominated by big system integrators (SIs) like IBM, Oracle, VMware
and their likes, enterprise software has shown apt positive signs by
growing at 16.3% in 2010 to Rs 11,000 crore; a figure higher than the
4.2% growth in 2009, according to research firm Gartner. According to
a Gartner report, Microsoft, IBM, Oracle and SAP outperformed their
peers in terms of revenue. Microsoft ranked highest as it increased
its enterprise software revenue market share in India to 28% in 2010.
IBM followed suit with its software revenue growing more than 15.3%
in 2010. IBM expanded dramatically in 2010 into the applications
segment with focus on e-commerce,
marketing and sales with more than 20 industry solution frameworks as
its
'Smarter Planet' go-to-market strategy evolves.

Also, Oracle
showed the strongest growth among the top 5 vendors, as it increased
its revenue by 25.2%. Its growth was achieved across all software
markets, with faster growth emerging from its business intelligence,
security, IT operations, and data integration and quality tools
offerings. Among the top 25 vendors in India, VMware led the group
with more than 51% growth in 2010, followed by Cisco with more than
31%. The top 25 vendors accounted for nearly 94% share, or more than
Rs 10,000 crore, of the overall software market. In strict sense,
services provided by enterprise software are typically
business-oriented tools such as online shopping and payment
processing, interactive product catalogue, automated billing systems,
security, content management, IT service management, customer
relationship management, resource planning, business intelligence, HR
management, manufacturing, application integration, and forms
automation.

However, in
India, often a loose approach to these concepts is noted, even the
big firms opting to go for a partial implementation rather than a
converged approach. As business enterprises have similar departments
and systems in common, enterprise software is often available as a
suite of programs that have attached enterprise development tools to
customize the programs to the specific enterprise. Generally, these
tools are complex enterprise programming tools that require
specialist capabilities. Coming to the tier-2 solution providers
(SPs) in India, Enterprise Software Solutions (ESS) registered a
nominal growth figure with limited scope of action as this space is
mainly dominated by the tier-1 SIs. Big revenue spinner SPs like
Value Point, Visesh Infotecnics (VIL), Embee Software and Trifin too
had a nominal share in this segment.

The fact
that
SPs are not keen to focus on ES in its pure form arises from the
reality that most of the enterprise deployments are directly done by
tier-1 players or are partially tendered to the tier-2 SPs through
vendor collaborations. However, even in this area, many SPs have come
up with their own set of solutions and techniques implementing ES
applications although in partially. To cite Visesh, the company has
been instrumental in providing multiple services to various state
governments. The e-governance team of the company was awarded a
project of nation wide importance namely 'AADHAR' which is
Government of India's 'Unique Identification Project'.

For Visesh,
pure ERP based ES deployments accounted for just 7% of the revenue of
the Rs 177 slot. The company is stating the figure to remain the same
in the near future. However, it is focusing over mobile computing
services and applications including GPS, tracking and others with a
clear aim of moving towards hand-held technology and applications.
The same has been the case with Techygyan where the company is
focused over public cloud, virtualization and active directory
services which accounts for 60% of its revenue. Apart from the focus
on managed services, Techygyan is considering virtualization and
public cloud as the latest in terms of technological advancement
which will drive the growth in near future.

Chabria
Infotech has also been one of the players in full-scale ES
implementations although the number of projects is limited. According
to the company, the same deployment philosophy applies for the SMB as
well as the enterprise segment with the volume and stature differing
over the application. Accounting for 15% of the consolidated revenue
of Chabria Infotech, this figure is also poised to remain stagnant
over the next CY.

For Value
Point Systems, ES has been growing steadily in its SMB segment.
According to the company, customers are showing keen interest in
evaluating options of SaaS, subscription model or PaaS models.
However, it is yet to see any major move from In-house Sever closet
or data center to external cloud in the ES space. The enterprise
software solutions space is witnessing some interesting trends. In
the last 2 decades, the emphasis has been on adopting the best
business practices and efficient data storage since most
organizations were in the process of streamlining their business
processes and their IT infrastructure. Today, the expectation from ES
solutions is vastly different.

According to
Visesh, organizations opting for an enterprise solution today place
greater emphasis on parameters like deployment model, regulatory
compliance and data consolidation. Efficient handling of business
processes is taken for granted. Of late, cloud has become the
buzzword in the industry with many traditional SPs considering to
offer cloud based solutions or at least, a part of the concept. As
cloud has began to surpass virtualization and envelop all the related
concepts like ERP, SaaS or BI models, ES is no exception to it.
Following the trend, the most significant direction that the
enterprise software solutions market is moving towards is cloud based
offerings. Every player in the fray is jumping onto the bandwagon.
Further, in the tier-2 SI space, the ability of the enterprise
software vendors to provide 'opt-in' features or 'on demand'
features on a flexible pricing model is also being measured by
organizations evaluating such software.

Organizations
that
have made significant investments in IT infrastructure and
resources still prefer the on-premise model for their enterprise
software deployment. A key parameter for them is the availability of
a business process platform that can be leveraged by the
organization's IT bandwidth to develop ancillary or collaborative
solutions around the ERP. Thus, their solution is flexible and
adaptive to business or compliance related changes. Another trend in
the market is the increasing role of mobile computing as an integral
part of the enterprise software offering. Open architecture and the
web have been key facilitators in this process. Following this trend
of the cloud, various SPs are considering venturing into this space
with Dynacons being a new entrant. Broadly cat style="background: transparent none repeat scroll 0% 0%; -moz-background-clip: border; -moz-background-origin: padding; -moz-background-inline-policy: continuous;">egorized
under
the ES model, the company is expecting cloud based ES
models to grow in time to come. As enterprise is one of the key
segments, the company has decided to take on the cloud services under
the ES category.

Similarly,
Kaytech and Choice Solutions are evaluating the scope of cloud in the
ES segment. Kaytech has been offering partial cloud services in the
form of MS Office 360 and after meeting with initial success, the
company is set to venture into the ES space. However, the case is bit
different for Choice Solutions. The buzz around cloud did not prompt
the company to consider cloud or ES as an opportunity but the mid-
arket traction and the evolution of SaaS and BI were the prime
factors. So long, Choice Solutions has been offering consultancy
services for ERP and BI with no implementations in place featuring
managed services as the prime offering.

However,
cloud is under the scanner as a retail and enterprise offering. With
not hoopla going around ES as a converged form, several features of
ES are under the scanner. Visesh has opted to focus on the
manufacturing, real-estate and logistics business for ERP
implementations while Techygyan has chosen the manufacturing and BFSI
sector as its focus area for the solutions category. So far, the most
noteworthy project has been from PC Solutions in the training wing of
IOCL for designing and implementation of training portal on Modern
Operating Systems Simulators (MOSS). The company has established the
training portal for IIPM using the advanced features and
customization of MOSS like preparation of annual training calendar,
online tracking of trainings status, participation request to attend
trainings, faculty assignment to trainings and others. This training
portal provides online management of all training related needs of
IIPM.

Next in the
line has been the migration of on premise mails to the cloud by
Techygyan for an export company where the SP also deployed
collaboration solutions by implementing document management,
workflow, systems collaboration and the intranet design. The most
innovative feature for this deployment, however, has been leasing out
licenses of MS Office, exchange and share point in the mode of SaaS,
whereby leasing was done to the customer instead of the regular
sales. Also, the local server was placed over active directory. A
similar kind of project was also deployed far a Linux based email
system in the manufacturing segment. Also, PC Solutions deployed a
project for a sales and marketing firm for virtualization in
installing vSphere Servers with minimum application. Technically, the
SP installed and configured the ESX 4 servers with instances, OS and
related hardware resources. Deploying the VMware virtual center,
configuration of VCB Module for backing-up Vmware Infrastruture,
Module between the ESX servers and volume creation were also done.

Apart from
the creation and back-up of the VM Infrastructure, PC Solutions also
migrated the company's existing application to the virtual
environment as well as the templates to the newer version. Value
Point Systems, too, deployed a mix of ES in the infrastructure
management domain. In a pharmaceutical company, the SP deployment an
automated IM using an ES. Primarily, it is a roll out and maintenance
of several hundreds of netbooks to their pan India spread sales
force. If the customer had used the traditional way of roll
out-deliver, then install OS, applications, drivers, patches,
updates and then keep repeating them manually over every support
tickets it would have caused them several days to complete the roll
out and a big team to maintain these end points across the country.
According to the company, today, using the AMS solution, this client
could complete the roll out within days and manage them remotely with
just 3 staff members with complete asset management, OS and
application management and remote proactive support.

Chabria
Infotech too has been working over the security aspects of ES and
deployed security solutions in the telecom and BFSI sector. However,
education remained the top priority segment for the company. As
stated previously about SPs considering a part of ES as a potential
business opportunity, the trend in technology will evolve to feature
SaaS and open-source ERP as the potential contenders for the top spot
under the cloud based systems.

So far, the
major trend this CY has been the disintegration of ES in the tier-2
space with cloud changing the entire equation of technology. Also,
conforming to its old tradition of securing the ES space by tier-1
SPs, the tier-2 SIs are finding it really difficult to offer a
holistic approach towards ES or in their deployments. The future of
ES in the strict sense looks pretty gloomy, but partially, along with
the emergence of the cloud, the SPs are keen to focus on this front.
Techgyan is focusing on this segment to make its triple solution
offerings climb to 75% of its consolidated revenue. Similarly, one
of the strongest SPs, Choice Solutions is keen to consider its cloud
offerings after the current evaluation stage and go ahead with a dual
approach for the online retailing segment and enterprise.

For Value
Point Systems too, ES and infrastructure management solutions are
poised to feature as 25% top line earner for the company in the next
fiscal. So far, considering the major deployments, innovation and
consistency, no tier-2 SP so far has gained much from pure ES
implementations but PC Solutions, Visesh as well as Techgyan has been
consistent players. However, when it comes to selecting the winner,
Visesh has outshone other players in this field, although the SP did
not deploy any major top line solutions but focused on innovation and
gradually progressing over the mobility enterprise segment.