Bred Tough: The Best-of-Breed, 2009

The first faint scents of a recovery are in the air, and niche software vendors are straining at the leash.

This has been a super-tough year for tech investments of all kinds. The big IT analyst firms kicked off 2009 with dismal forecasts for the IT market and have been revising them downward ever since. The numbers turned negative even for the software segment, historically the most resilient. Gartner's June forecast for worldwide IT spending has software spend contracting by 1.6 percent for 2009; Forrester's global IT outlook (also published in June) is even bleaker, predicting a whopping 8.2 percent decline in software spend for the year.

But the worst may soon be over, the analyst houses agree. The decline in the software sector has almost stabilized, according to Gartner, and the firm predicts a return to positive growth of 3.2 percent in 2010 -- pretty anemic, but at least it's in the right direction. Forrester expects a turnaround in the overall IT market starting in Q4 as businesses realize that they overreacted in the first quarter. The U.S. market will lead, with Europe and Asia turning the corner in the first quarter of 2010.

This is good news for every one of the firms we list here in our annual roundup of best-of-breed software vendors. There's good news for buyers, too. The bargains are still out there, for now. The products and providers that survive in this frigid climate will be around for some time to come as the economy thaws. And the recession may actually have stepped up the pace of innovation; just as the features of Web 2.0 were forged in the 2001--2003 tech meltdown, expect the next wave of groundbreaking technologies to emerge from the current downturn.

BPM Tackles the Planning Crisis

Business performance management (BPM) software vendors are thriving even in these tough times, as companies cast about for ways to manage cost and risk and optimize profitability. In BPM Partners' BPM Pulse Survey 2009, more than half of respondents said that they have increased their focus on performance management investments, as John Colbert, VP of research and analysis with the firm, reported in the June issue of BPM Magazine.

In a business environment that's forcing many organizations to re-envision or even jettison their budgeting and planning processes, Paul Schuster, VP of corporate finance and treasurer with insurance giant Trustmark, is sticking with what he's got -- a planning process of extraordinary depth that, at first glance, might make the most dedicated planner blanch. In monthly business review meetings, Trustmark takes a detailed, driver-based look at each of its core business units as well as its three major support areas: the claim payments operation, IT, and managed care.

"We have drivers and subdrivers and sub-subdrivers," Schuster says. "For example, just looking at the sales calculations in one of our business units reveals that it has several pages of calculations of what's driving it. I'd say that collectively, for everything that we're doing, there are thousands of drivers. And we do them each month, for every month remaining in the current year and every month of the next year."

Trustmark has been doing this for the past 8 or 9 years. As befits a leader of a company with a 100-year-plus history, Schuster takes the long view: "Through all of the 1900s, we did reasonably OK, but since then we have been generating profits that have been two and three times higher than any generated prior. And this is because we're actually managing the business much more effectively."

Up until 2006, when Trustmark implemented a BPM system from Longview Solutions, company execs managed all of these calculations in spreadsheets, some of which were of "monstrous" proportions, says Schuster. An Excel workbook covering salary planning and forecasting for the company's 2,000-plus employees had grown to 55 megabytes and 225 linked worksheets, he recalls. Clearly, something had to give.

The Longview software radically simplified the workload for the monthly planning sessions. "It's a six-dimensional database; the difference between plans, forecasts, and actuals is just a change in the 'time' dimension," says Schuster. "The hierarchy of the reporting and the drivers and everything is the same, so it allows us at the push of a button to have all of the information, actuals and forecasts, for the year. Plan, current year plan, next year's plan -- all of this is available.

"The ledgers historically had that capability to do variance reporting and consolidations for the actuals, but to do the calculations to the level we do now with the ledger systems we had wasn't feasible," he adds.

For Trustmark, there's no going back to the ledger-plus-spreadsheet days. "Whenever we're getting into some pressure on the need to cut costs," says Schuster, "I threaten to pull the plug on this system -- and I just hear massive wails! This tells me that it's adding value."

BUSINESS PERFORMANCE MANAGEMENT

A3 Solutions Inc.
A3 Modeling
www.a3solutions.com
Acorn Systems
Enterprise Performance Suite
www.acornsys.com
Active Strategy Inc.
Active Strategy Enterprise On-Demand
www.activestrategy.com
Actuate Corp
Actuate Performancesoft Suite
www.actuate.com
Adaptive Planning Inc.
Adaptive Planning
www.adaptiveplanning.com
arcplan
arcplan Edge
www.arcplan.com
BizNet Software Inc.
BizExcelerator
www.biznetsoftware.com
BOARD International
BOARD toolkit
www.board.com
Carpio Solutions
GesFin Planning Suite
www.carpio.com
Centage Corp.
Budget Maestro
www.centage.com
Clarity Systems Limited
Clarity
www.claritysystems.com
ClearMomentum Inc.
ClearFinancials
www.clearmomentum.com
CODA Ltd.
CODA 2know
http://www.coda.com/products-services/2know
Corporater
Corporater EPM Suite
www.corporater.com
Ferox Microsystems Inc.
WebFact
www.ferox.com
Host Analytics
Performance Management Suite
www.hostanalytics.com
IBM
IBM Cognos TM1
www.cognos.com
Infor
Infor PM
www.infor.com
Isis Solutions Inc.
ISIS Discovery & Predictive
Analytics
www.isis-solution.com
KCI Computing Inc.
CONTROL
www.kcicorp.com
Longview Solutions
Longview Performance Management Platform
www.longview.com
Microsoft
Microsoft FRx
www.microsoft.com/frx
myDIALS Inc.
myDIALS
www.mydials.com
Oracle
Hyperion Financial Performance Management
www.hyperion.com
Palladium Group
Executive Strategy Manager
www.executivestrategymanager.com
PowerPlan Corp.
PowerPlan
www.powerplancorp.com
PROPHIX Software Inc.
PROPHIX
www.prophix.com
Quantrix
Quantrix Modeler
www.quantrix.com
River Logic Inc.
Enterprise Optimizer
www.riverlogic.com
Rocket Software
CorVu
www.corvu.com
Salient Corp.
UXT
www.salient.com
SAP
SAP BusinessObjects
www.businessobjects.com
SAS Institute Inc.
SAS for Performance Management
www.sas.com
Symphony Metreo
SymphonyRPM Performance Management Platform
www.symphony-metreo.com
Tagetik
Tagetik
www.tagetik.com
Teradata
Teradata Finance and Performance Management
www.teradata.com
Visual Mining
NetCharts Performance Dashboards
www.visualmining.com