Oracle (ORCL) , Microsoft (MSFT) , and SAP (SAP) are likely to face tougher challenges from smaller players in the $300 billion enterprise software market as an increasing number of clients prioritize user-friendliness and innovation over the size of the suppliers, according to a research by GP Bullhound.
"The days when the largest vendors were assumed to provide the best solutions are gone," the M&A advisor said in a report published Friday. "Today, forward-thinking corporate users are on a never-ending search for better, more agile and innovative solutions that would meet their demands."
GP Bullhound, a London-based M&A advisor for the technology sector, published the report including findings from its survey with over 150 tech professionals, 61% of which were users and the remainder vendors.
The rise of smaller software players is driven partly by a shift in the decision-makers of a user organization to regional offices and end-users from top level executives. And the focus by these decision makers on user-friendliness, localization, and specialization are turning them towards emerging players who can better meet those needs compared with the likes of Dell EMC, Microsoft, SAP, and Oracle.
"In an environment of fierce competition, where being great at one thing is better than being just good at a lot, companies are being forced to focus on their core strengths in order to survive and succeed," the report said. "Vendors of Enterprise Software that help their users concentrate on what they do best while bridging efficiency gaps in their operations will add true value, and therefore prevail."