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KM software, services to touch $54.2 m in India

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CIOL Bureau
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CHENNAI: The Indian Knowledge Management (KM) market is on the verge of take off. The market revenue in 2002 is estimated at $22.7 million.

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The KM software and services market is expected to grow at a compound annual growth rate (CAGR) of 19.0 percent between 2002 to 2007 to reach a level of $54.2 million by 2007 according to the latest Frost & Sullivan report on India Knowledge Management Software and Services Market.

"Majority of the enterprises are in the early stages of adopting KM solutions and, hence, a greater growth rate is expected as bigger implementations take place," says Amit Phatak, Industry Analyst Technology Practice, Frost & Sullivan.

Information technology and communications has completely changed the dynamics of many economies. Globally, economies have seen complete shifts in markets, quicker proliferation of technologies, a rapidly increasing number of competitors, and products and solutions that were once leading edge become obsolete almost overnight.

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Under these circumstances, successful companies are those that nurture knowledge, disseminate it widely throughout the organization, and quickly embody it in new technologies and products. This economic and business backdrop makes ‘knowledge management,’ a huge business opportunity for marketers globally.

Knowledge Management encompasses a plethora of overlapping technologies. Frost & Sullivan’s research includes a detailed analysis of the knowledge management market encompassing primarily three major product classes: document management systems, enterprise portals-content management, and pure knowledge management applications that are placed on top of rudimentary business information systems supplying industry-specific solutions.

Knowledge Management software and services in the report encompass all the four building blocks of a knowledge management solution–data conversion/capture software; document management, retrieval-distribution, and sharing.

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Besides, enterprise-wide information sharing and transactions (enterprise portals) and pure-play knowledge management applications encompassing mature tools such as best practices, collaborative tools, and business intelligence layer.

The KM market is characterized by a number of specific offerings from various types of local and global products and services companies.

A few years back, the focus of many companies was in offering solutions for a particular business problem–whether building knowledge repositories or real-time information dissemination. Now, enterprise-wide solutions providing end-to-end knowledge management solutions are evolving rapidly’, adds Phatak.

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Major factors driving growth of KM software and services market in India during 2003 to 2007 are exploding information repositories, increasing business automation, ever increasing real-time information needs, leveraging tacit knowledge, speed-to-market and the urge for innovation among business.

Current Indian business environment is passing through business process automation phase, with moderate level for KM solution adoption. KM awareness is growing across all business segments. If solution vendors can educate end users of the direct benefits that they can draw from various KM initiatives the rate of adoption of these solutions would definitely pick up.

‘Knowledge Management as a concept is fast picking up in the Indian businesses with service industry being one of the first adopters and software companies leading the way, traditionally weak technology savvy business verticals such as government and manufacturing would drive market in years to come’, says Phatak.

Current demand for KM solutions is point solution specific, most demand, in the near future, is expected to come from enterprise-wide solutions. Vendors thus need to focus on enterprise-wide solutions rather than pure department or point-specific solutions.

Knowledge management vendors that have specific vertical-level strategy and provide a solution bouquet to these segments to cater to their demands are expected to garner a higher market share according to the research.

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