As businesses undergo digital transformation to meet the challenges of the digital economy, modern software with its properties of automation, connectivity, and visibility has become critical to achieving competitive advantage.
Enterprise applications (EA) are the engine of the business, providing the data, intelligence, and computational tools necessary to function in the digital economy and every line of business within an organization depends on multiple software applications to function.
Mickey North Rizza, program vice president, Enterprise Applications and Digital Commerce at IDC said "digital transformation initiatives are bringing impactful changes to organizations such as the ability to work anywhere and anytime, identifying new insights because of cognitive and predictive processes, and reshaping the enterprise experience using modern and cloud-based enterprise applications. Enterprise applications are the foundation of business processes, employee engagement, and customer experience."
Fuelled by ongoing digital transformation investment, IDC shows that worldwide revenue in the enterprise applications market grew 7.5% year over year in 2019 to $224.6 billion. The top 5 enterprise applications vendors in 2019 were SAP (7.7% revenue share), Oracle (5.1% share), Salesforce (5.0% share), Intuit (3.0% share), and Microsoft (2.1% share).
Enterprise Applications in 2020 and beyond
IDC's expect the worldwide enterprise applications market to have a five-year compound annual growth rate (CAGR) of 3.4% with revenues reaching $265.7 billion by 2024.
The share of public cloud software revenue is forecast to grow from 40.3% in 2019 to 56.8% in 2024, as growth opportunities move heavily in favour of cloud applications.
EA vendors are enabling new use cases for enterprise applications by utilizing big data/analytics and machine learning to bring more actionable insights across a broader workstream.
Vendors are also working to automate lower-level tasks within the applications. IDC expects this trend to continue and to be a key factor in determining market positioning among enterprise application vendors in the future.
