Enterprise software like ERP, SCM, CRM, and HCM has been seen as a support function, lacking innovation and taking a long time to benefit from a good application strategy. However, organizations now prioritize enterprise software’s biggest issues. Companies prioritize data privacy and security. Enterprise software can undergo a massive transformation to accelerate innovation thanks to new middleware, integration, and cloud-native solutions.
Enterprise software is evolving, and 2024 promises change and innovation. Enterprise software vendors can meet organizations’ changing needs and revolutionize software consumption and investment. Moving to the cloud, using generative AI (genAI) in business software, ensuring fair and responsible governance, and integrating functions more deeply with the business will improve company capabilities. Enterprise software will evolve to stay competitive and catch up to new rivals as organizations modernize.
Forrester’s predictions for enterprise software in 2024:
- The adoption of Software as a Service (SaaS) is expected to see a significant increase as late adopters join the trend, leaving only a quarter of the population still hesitant to embrace this technology. Although certain enterprise software categories have already reached a saturation point in terms of cloud adoption, late-adopter categories like supply chain management and ERP continue to witness substantial on-premises purchases up until now. However, the impediments of organizational resistance and nascent cloud offerings have significantly diminished their impact. By 2024, it is anticipated that the late-adopter segments will decrease to 25% of new enterprise software acquisitions (attributable, in part, to escalated on-premises pricing). This shift will result in software-as-a-service investments surpassing the majority share at 75%. The pursuit of improved innovation and collaboration is what drives both vendors and customers.
- The software commitments made to genAI are expected to incentivize approximately 90% of companies to undertake modernization efforts. The perpetuation of AI hype will persist, albeit with limited gains in productivity and revenue growth, should there be a lack of progress in implementing AI solutions across all facets of the organization, rather than solely focusing on front-office operations. Business leaders are optimistic that the potential of incorporating genAI technology into productivity will effectively address the underwhelming outcomes of previous transformation initiatives. However, in order to get the most out of the benefits of genAI and ML-embedded software, it is important to make major modernization efforts by 2024 to make sure that performance and efficiency are at their best.
- The impending acquisition of a prominent vendor will have a significant impact on the evolution of enterprise software in the upcoming generation. Anticipate a significant surge in acquisitions by major software vendors in the upcoming year of 2024, following a period of relative tranquility spanning two to three years. In the current economic climate, it is crucial for technology buyers to focus on acquiring software solutions that optimize business operations, enhance productivity, and enhance the overall experiences of both employees and customers. The target audience for these buyers consists of individuals who are in search of software solutions that can offer enterprise-level connectivity, a wider range of capabilities, and larger partner ecosystems. This is in contrast to the limitations of existing functional application software, which is typically confined to specific areas and lacks the ability to deliver on these requirements.As software developers, we are highly motivated to establish our dominance in the industry. It is our anticipation that by the year 2024, we will witness a significant acquisition worth no less than $5 billion.
Enterprise software refers to the applications that businesses and organizations use to support their internal operations, processes, and collaboration. These software solutions are designed to address the unique needs and requirements of large-scale businesses, helping them manage and streamline various aspects of their operations.
Key characteristics of enterprise software include:
- Scalability: Enterprise software is built to handle the complex and growing needs of large organizations. It should be able to scale up to accommodate increasing data, users, and transactions.
- Integration: These systems often need to integrate with existing infrastructure and other software applications. Integration capabilities are crucial for seamless communication and data exchange between different parts of the organization.
- Customization: Enterprises have diverse needs, and a one-size-fits-all approach may not be suitable. Enterprise software should be customizable to adapt to the specific requirements of different departments and business processes.
- Security: Given the sensitive nature of business data, security is a top priority. Enterprise software is expected to have robust security features to protect against unauthorized access, data breaches, and other security threats.
- Collaboration: Enterprise software facilitates collaboration among teams and departments. It often includes features such as document sharing, project management, and communication tools to enhance teamwork.
- Analytics and Reporting: Enterprises rely on data for decision-making. Effective enterprise software includes robust analytics and reporting capabilities, providing insights into various aspects of the business for informed decision-making.
- User Interface (UI) and User Experience (UX): While functionality is critical, a user-friendly interface is also important to ensure that employees can easily navigate and use the software. A well-designed UX enhances productivity and user satisfaction.
Examples of enterprise software include:
- Enterprise Resource Planning (ERP) Systems: Manage core business processes such as finance, HR, procurement, and supply chain.
- Customer Relationship Management (CRM) Systems: Manage interactions with customers and potential customers.
- Business Intelligence (BI) Systems: Provide tools for analyzing and visualizing data to support decision-making.
- Collaboration and Communication Tools: Examples include messaging platforms, project management tools, and intranet solutions.
- Human Capital Management (HCM) Systems: Manage HR processes, including payroll, talent acquisition, and employee performance.
- Supply Chain Management (SCM) Systems: Optimize and manage the end-to-end supply chain processes.