The Knowledge management (KM) market will become a $1.6 billion battle zone, says Ovum Consulting?s senior analyst, Eric Woods.
He forecasts that a whole raft of vendors will seek to dominate this part of corporate IT, and while groupware, information retrieval, and document management vendors will dominate in the short term, the real differentiator will be the support offered by database, datawarehousing and ERP vendors.
Ovum?s new report, ?Knowledge management: applications, markets and technologies?, defines KM as the task of developing and exploiting an organisation?s tangible and intangible knowledge resources. It covers organisational and technological issues, and Ovum identifies the most important trend as ?the convergence of technologies for managing and analysing unstructured information".
"Vendors who hijack the term for marketing purposes are missing the point and the winners will be those vendors who really understand the changes in business and technical environments that KM involves," says Woods.
But what is it about knowledge management that differentiates it from the waves of management and IT theories that promise much and, too often, deliver very little? Woods defines KM as a body of management theory that includes the organisation and its culture. He said it focuses on the way we use structured and unstructured information, sometimes described as explicit or tacit.
?Explicit information is coded and characterised by easy exchange, tacit is all about knowhow and expertise, about customers and relationships. It is the type of information that gets exchanged around a coffee machine on a one to one basis, and KM is attempting to create a space in the network for sharing information and collaborating.?
The KM vendors fall into four groups. The first, like Verity, retrieve information across the corporation, including Extranets and Intranets. Then there are the groupware suppliers, with Lotus and Microsoft battling it out.
Woods says: ?Lotus is rethinking a lot of information paradigms and going back to basics. KM will be key to next release of Domino, due at the end of this year.?
The third and fourth groupings are document management suppliers and start-ups, ?many of which have good systems, but they are niche and need to expand into new applications".
The interesting moves are likely to come from traditional database and ERP vendors, and whatever emerges from the growing number of mergers and acquisitions.
Ovum believes that, until the end of this year, KM will be dominated by service providers like KPMG, Ernst & Young and IBM. 1999 through to 2001 will see the groupware and document management companies flex their muscles and develop wide areas of collaboration. 2002 onwards should see KM integrated more fully into the corporate infrastructure, particularly as ERP vendors show their hands.
Woods says: ?KM has been around for a long time but it?s been overshadowed by BPR and downsizing issues. It has reached the point now where consultancies like Ernst & Young and KPMG are running fully fledged practices, although the software vendors are late to market we?ll soon see a clearer picture as they formulate strategies, particularly from the likes of Lotus, Microsoft and IBM.?
He forecasts that the market for KM software will grow from $285 million in 1998 to $1.6 billion in 2002, and in the same period, the KM services market will grow from $1.5 billion to just over $5 billion
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