IDC: Asia Sees Slowdown in ERM Growth

SINGAPORE (04/25/2000) - While the overall Enterprise Resource Management (ERM) market continues to expand, the growth rate in Asia is falling, according to research organization International Data Corp. (IDC).

At its Asia-Pacific Directions conference held in Singapore last week, IDC noted that the Asia-Pacific (less Japan) ERM market this year is expected to reach US$910 million, a 22 percent increase over 1999's $745 million value.

However, the growth rate represents a decline from 1998's high of 30 percent and 1999's 26 percent, and is expected to slow even more to 16 percent by 2003, IDC said. The market value of the region's ERM industry would then be US$1.6 billion.

"The demand for traditional enterprise applications has matured and slowed in many parts of the world," said Selinna Chin, research manager, enterprise information solutions, IDC Asia-Pacific.

However, Chin noted that Asia's economic recovery and the Year 2000 non-event is spurring technology investments.

"E-business and customer relationship management (CRM) issues are fueling the enterprise market, and supply chain re-engineering is driving application growth," she said.

IDC's research has found that 29 percent of ERM users integrate the system with their CRM applications, while another 19 percent integrate ERM with e-business applications.

To emphasize the importance e-business is expected to play in the future ERM market, Chin noted that "98 percent of all users see the need for e-commerce in the future." IDC also found that services represent the largest portion of a company's ERM budget at 49 percent, compared to software at 32 percent, and hardware at 19 percent.

Another finding was that ERM is seeing the greatest growth in accounting and finance applications, followed by human resource/payroll, and project management.

While often used interchangeably with Enterprise Resource Planning (ERP), industry players define ERM as encompassing accounting, human resources and materials management software, while ERP is ERM plus applications.

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