"Executives don’t expect 2005 to be another year of flat performance: 52 percent of those urveyed anticipate modest 5 to 9 percent revenue growth for the overall industry. Another 29 percent’s predictions were for growth of 10 percent or more."
.Source: Sand Hill Group
Despite the rosy outlook, there is no doubt that significant challenges remain.When asked to name the software industry’s greatest challenge, 35 percent of respondents pointed to stagnant corporate IT budgets. Small companies were most concerned about this continuing dynamic, while larger companies were slightly more likely to indicate “lack of growth.” Other concerns included lack of innovation and increasing consolidation.
“This is as challenging an environment to manage a business through as any I’ve seen in my 25 years in the business. The next two years will likely be ones of moderate growth, but I think it will take three to five years for sustainable business models and practices to return, around which startup, growth, niche and mature companies can be run and evaluated.”
CEO, midsize applications and infrastructure company
“Buyers are still very cautious and very thorough about purchasing. Unless there is a regulatory requirement, they are under no rush to buy.”
CEO, midsize Internet applications company
“We’re expecting a slight improvement over 2004. But we’re still not seeing a tidal wave of buyer momentum.”
CEO, midsize applications company
.Source: Sand Hill Group
“Software industry executive teams need to grow up and realize that the industry is not a fast-growth industry anymore and software companies need to be managed for profit and cash flow just like other traditional industries. Executives need training and knowledge
transfer on best practices for operational effectiveness in the software industry.”
CEO, midsize applications company
They key: Adapt new business models to the changing world around you - or not - either way you are deciding on a strategy.
No comments:
Post a Comment