Recent findings from The Sourcing and Procurement Market Sizing Report, 2006-2011 by AMR Research show the procurement and sourcing market growing at a pretty healthy rate of 10% between 2005 and 2006, with a compound annual growth rate (CAGR) rate forecast at 8% until 2011 to create a total market value of $3.6bn.
Unsurprisingly, ERP providers seem to be leading the sourcing and procurement market in revenue terms, but the rapid expansion of indirect procurement has led to the big ERP vendors coming a clear second in terms of market share (32%). It is in this area that vendors such as ourselves have made the real running and the most striking element of AMR's research was the growth seen in on demand revenues.
This clearly ties in with what the report sees as the main challenge facing chief procurement officers – the question of how to make use of the best technology and services available is the imperative for any company looking to improve their spend visibility and management- and the growth in on demand revenues seems a vital indicator that many organisations are choosing to look beyond their installed ERP vendor to find better value, time to market and ROI from best-in-class hosted applications.
"Vendors will continue to drive technology and service enhancements to enable process improvements resulting in business speed, agility, and faster time to value," the report reflects.
