BMC software (BMC)

[Eagle1]

BMC: Gartner's 2008 IT service desk Magic Quadrant focuses on enterprise-class vendors that met Gartner's criteria, as defined below, that includes the vendor's ability, demonstrated through customer references, to address the needs of customers seeking to provide functionality for incident, problem, change, knowledge, self-service and service-level agreement (SLA) management. Additional analysis for the 2008 Magic Quadrant has been placed on change management features, functionality and integration, because Gartner is finding that 60% to 80% of organizations are choosing change management and the service desk from the same vendor.

IT organizations adopting a holistic approach to IT service and support tend to acquire the vendors' suites of IT service management (ITSM) modules. These suites can help clients aggregate data among modules, which leads to better decision making regarding end-user downtime, whether due to application failure or end-user-based issues, the cost and quality of IT service and support, and the business's overall satisfaction with IT. Tool selection is influenced by ease of deployment, integration with other ITSM modules, in particular change management and configuration management database (CDMB), pricing, as well as core functionality around incident and problem management, self-service, reporting, dashboards and workflow. The vendor's ability to deliver feature enhancements and additional ITSM modules has been evolutionary, not revolutionary.

http://mediaproducts.gartner.com/reprints/bmc/article21/article21.html











Source: Gartner (October 2008)


Market Overview

IT service desk tools continue to be the focal point of an IT organization's strategy to deliver service and support. The increasing complexity of the IT environment, the pressure to reduce costs and the drive to align IT resources with business priorities continue to fuel the IT organization to improve the people, processes and technologies of the service desk. Vendors' products have been slowly evolving from the early 1990s, with basic incident ticket management functionality, to today's integrated suite. Typically named ITSM, this suite comprises modules covering incident, problem, asset, configuration/inventory repository, change, knowledge, self-service and SLA management functionalities. The IT service desk portion of a suite tends to include incident, problem and self-service modules, and is the base-priced offering. Moreover, the Information Technology Infrastructure Library (ITIL) continues to influence the functional additions of future suite modules, such as service request management, service catalog and release management modules.

Today's IT service desk market has three fundamental characteristics:

Maturity: The IT help desk has been in existence since the 1980s, and several vendors ranked in this Magic Quadrant have had service desk products for more than a decade.
Saturation: Most IT organizations have a service desk tool in production; as a result, few "greenfield" opportunities are left for vendors.
Competition: Gartner covers more than 20 different vendors and service desk products installed in enterprises worldwide. Two vendors, IBM and Service-now.com, met our strict inclusion criteria for 2008 and are newly ranked in this Magic Quadrant. In 2006, Microsoft announced that it would enter this market, but this has been delayed, and its product is now scheduled for official release in 2010.
Even with the service desk market's maturity, saturation and competitiveness, Gartner estimates that the market was nearly $1 billion in 2007 and grew at a 14% rate annually. We find that the average IT organization replaces its service desk tool approximately every five years. This replacement cycle has endured for more than a decade due to various factors, such as elongated and incomplete implementation, customization (which, over time, prevents migration to new versions) and ITIL-based process refinement initiatives. Regrettably, at least one-third of tool implementations suffer from poor project and key performance indicator management. However, process maturity has become a powerful force toward influencing the degree of success regarding implementations. Market growth is also fueled by growth of modules and seats (named and concurrent). All these market dynamics continue to spur vendor investments in meeting evolving customer requirements. However, larger ITSM suite deals have significantly increased the dollar amount of new deals for vendors and have lengthened the sales cycle.


Return to Top





Current Customer and Vendor Trends in the IT Service Desk Market
With the ongoing emphasis on increasing the effectiveness and efficiency of IT service and support, IT organizations are demanding more from their service desk tools. The following are the major customer trends we are seeing and how vendors are responding:

Breadth of the integrated ITSM suite: There is an industry desire to have better management data to aid in IT service support analysis. Influenced by process methodologies such as ITIL, IT service and support organizations have acceded that they can derive greater value when the data and processes from these modules are integrated. Based on this, vendors have expanded beyond the service desk module (including incident, problem and knowledge management) by adding change, configuration/inventory repository (most often identified as a CMDB), service-level, request and release management modules. These modules and other features are bundled into a suite offering typically called ITSM. This level of management knowledge is needed to drive continuous IT service support quality and efficiency improvement. Data from these integrated modules should offer insights, such as root cause analysis, enable trend analysis and influence future IT investments. The "promised" value in data and process integration between service desk and various ITSM modules fuels the trend for IT organizations to buy suites of modules from one vendor, because integrating best-of-breed tools from separate vendors can be time-consuming and costly. Key evidence of this is the growing desire to integrate incident, problem and change processes, which leads IT organizations to purchase the IT change management (ITCM) module with the IT service desk tool. Gartner inquiries with clients also show a sharp increase in the role of CMDBs in the selection criteria for IT service desk tools. Clients are also interested in tight integration of their service desk tools with other ITSM functionality, such as PC configuration management, and service catalog and inventory/asset management. However, IT organizations should not assume that just because the modules all come from one vendor, the integration is already done, easy and preconfigured.
The ITSM suite will continue to expand as long as other ITSM vendors see the value of adding ITSM to their overall portfolios. During the past 18 months, vendors have responded to clients' demands for a large and more-integrated ITSM tool suite by building or acquiring additional modules, such as for service catalogs and service requests. Vendors also had tied their IT asset management modules to their ITSM suites. BMC Software recently acquired ITM Software to integrate financial management capabilities focused on IT service portfolio and service catalog. Several vendors have begun to add the release management module, integrated with change management, to improve change governance. Using an acquisition to expand a vendor's ITSM portfolio is also common: EMC acquired Infra, and Avocent LANDesk acquired Touchpaper to extend its operation management capabilities.
Ease of deployment: A positive trend in the service desk market is the vendor focus on ease of deployment. At the beginning of 2000, IT service desk tools had the well-founded reputation for being difficult to deploy and for requiring a lot of customization. The high degree of customization required to deploy a service desk tool stifled enhancements and upgrades, curbed flexibility and added to the already high total cost of ownership. A trend for IT organizations, so as to remain more flexible and have a quicker return on investment, is to perform little to no customization, run more "out of the box" and rely more on best-practice workflows and templates, rather than create their own. Vendors have recognized this trend and have invested in easier drag-and-drop configurations of workflows, fields, graphical user interfaces and additional prebuilt templates and workflows. Gartner clients report that the vendors' focus on configuration versus customization and prebuilt workflows and templates has improved the ease and time of implementation. We expect vendors to continue investing in this area to show value to their customers and to gain a competitive advantage. Some vendors have even started to guarantee a service desk implementation in a specific period of time.
The interest in software-as-a-service (SaaS) service desk solutions can be linked to deployment concerns in the industry. Ease of deployment is a main reason why some service desk customers and prospects consider SaaS solutions. SaaS service desk products are delivered on-demand using the Internet as the platform, which can noticeably reduce the time and resources required for implementation. Additionally, this type of solution can accelerate new version upgrades. The inability to upgrade in a timely manner is a contributing factor in service desk replacements.
Best-practice process management: Often, service desk tools are scrutinized and replaced when an IT organization undergoes a major process improvement initiative. Therefore, vendors try to convince IT service desk customers that their tools are more aligned with the ITIL than those of their competitors, and that the tools are better-suited to help develop best-in-class process management. The vendors tout their depth of knowledge of ITIL, their best practice resources acquired from ITIL "master" specialty resources and how their prebuilt templates and workflows are closely aligned with industry best practices. BMC Software, CA and HP recently invested heavily in best-practice templates and guidebooks. IT organizations that are just starting process improvement initiatives, or that have a maturity assessment of less than a committed Level 3 (see "Introducing the Gartner IT Infrastructure and Operations Maturity Model"), will find this content helpful, but more-process-mature IT organizations will find little value in them.
Any help clients can get from vendors to marry their tools and processes is welcome, but vendors are having increasing difficulties differentiating their offerings from those of their competitors, which tout the same message and expertise. With little perceived competitive value for a free service, vendors will likely curtail investments in this area.
Simplified and flexible pricing: A piece of good news for all service desk customers is that vendor pricing has become simpler and more flexible. Service desk tools have historically had complex pricing, with separate licenses required for incident, problem and change management. In addition, developers may have needed separate licenses, and many application and integration licenses often were needed as well. The result was that customers found themselves with too many of one type of license and not enough of another, frequently facing high maintenance fees. Several years ago, a few vendors began offering simplified pricing, with fewer product numbers and, more importantly, one license per analyst for incident, problem and change management. In addition, vendors are beginning to charge per seat for end users for service request integration with the self-service portal. The other vendors have had to follow suit and are offering simplified pricing, although vendors still need to make more progress in this area, according to Gartner clients.
The advent of the SaaS licensing model has been the largest innovation in the service desk market in recent years. SaaS has opened up pricing flexibility that did not exist a few years ago. Now, IT service desk tools can be bought on a month-to-month subscription basis, which creates opportunities for IT organizations with constrained capital budgets, limited staff to administer the tool, evolving service desk strategy or a preference for the SaaS license model. Gartner has seen a sharp increase in the number of IT organizations requesting service desk tools that are sold as SaaS, and we expect this trend to increase sharply during the next several years. Service-now.com has benefited significantly from the trend, because it was the only SaaS service desk provider for a period of time. HP recently began offering SaaS for IT service desks, and we predict that most vendors will offer this pricing model during the next two years.

Return to Top





Little Innovation in Core Service Desk Features and Functionality
The vendor focus on adding modules to a wider ITSM suite footprint has established a common pattern of incremental enhancements, which results in more-modest enhancements, instead of driving real innovation in the core service desk module. From a vendor perspective, development resources become stretched across a horizontal expansion of new modules, and vendors face integration challenges with integration when acquiring new capabilities. Vendors seem content with modest enhancements to the service desk product and are playing catch-up with each other, rather than trying to drive real innovation. Innovation can be a double-edged sword. Customers may clamor for innovation; however, they find "innovative" new releases costly and lack the budget/plan to execute quickly. Gartner clients tell us that, when they undertake a detailed comparison of the features and functionality around incident and problem management, the vendor's offerings are 90% to 95% the same.

The similarity in service desk tools has made it difficult for vendors to differentiate themselves in this market, and many vendors have identical marketing and sales messages. The lack of considerable competitive differentiation among vendors ensures that overall market share will continue to be fragmented, with every vendor replacing and being replaced by competitors. A SaaS solution may not be real innovation, from a feature and functionality perspective; however, the SaaS model offers innovative ways for companies to buy, implement and update a service desk solution. In many cases, this will translate into lower ownership costs and will improve the potential return on investment.





Is There Really an Area of Marked Differentiation or Innovation?
Fundamentally, differences tend to be at the administrative and technical layer, or in the depth of a specific function. The ability to differentiate within the administrative and technical layer materializes in the ease of policy configuration, drag-and-drop manipulation of established workflows, implementation time and the ability to integrate among process modules. Another discernible area of differentiation is associated with how configuration/inventory knowledge is leveraged in the change module. The greater the knowledge, the stronger the functionality in automation and reporting associated with change assessment and scheduling.





Areas of Improvement
Although the service desk market is mature, and vendors have had years to continually improve their products, there are still several glaring improvements that vendors should be working to address to help differentiate their products from those of their competition:

Self-service and request management: Although the benefits and return-on-investment potential for self-service in IT service and support are well-known, most IT organizations struggle to provide meaningful self-service sites to end users. A lack of best practices, transparent workflows, metrics and reporting has made implementing a self-service site challenging for IT organizations. A recent trend is that vendors are putting cosmetic enhancements on their self-service portals and are trying to call them full-fledged service catalog offerings, without the necessary service templates, workflows, integrations, metrics and SLA reporting. This is leading to confusion in the market regarding the difference between self-service, request management and service catalog offerings; thus, IT service desk customers will need to look behind the marketing hype.
Knowledge management: As with self-service, the benefits of knowledge management for reducing downtime and decreasing costs are well-known, but only a small percentage of IT organizations successfully use the knowledge management capabilities of their service desk tools. IT organizations know the value of knowledge management but often lack the metrics, reporting and best practices necessary to justify the investment in people and processes needed for a successful implementation. Many IT service desk vendors bundle a mediocre keyword search knowledge management tool with the service desk tool and offer a more robust knowledge management module or similar partner offering for an additional cost. This adds to the workload of the service desk manager, who must justify why the "free" knowledge management tool isn't good enough.
Reporting: Service desk reporting functionality continues to receive low scores from users. Most IT organizations report that they have given up on the reporting that comes with the tool and must purchase a best-of-breed database reporting tool, such as Crystal Reports. IT organizations are frustrated with the inability to pull real-time reports and say that they spend too much time creating customized reports for management. Most templated reports are centered on basic tracking of a few data fields by record within a given module. Vendor vision on integrated reporting seems to rest on next-generation, service-level management products that are priced separately. We find that insufficient reporting capability is a main reason why IT organizations replace their service desk tools every five years.
Small or midsize businesses (SMBs) have a more modest number of end users and typically require less functionality depth and only a few, core ITSM modules. In most cases, SMBs focus on implementing only incident management, holding off on problem management. SMBs also may want to implement basic change management procedures, reducing the depth of risk and impact requirements, which translates into less configuration integration. SMBs will find that many competent vendors not included in this Magic Quadrant may have solid products, lower pricing and financial viability that is well-suited for their needs (see Note 1).





Market Definition/Description
The IT service desk market consists of vendors that offer tools to improve IT incident, problem and change management, in alignment with additional ITSM modules, such as asset, configuration/inventory repository, knowledge, self-service and SLA management. IT service desk tools document, review, escalate, analyze, close and report incidents and problem records. Information captured within the numerous data fields in a record now becomes a management source for analysis and reporting. Foundational functionalities include classification, categorization, business rules, workflow and search engines. These tools manage the life cycles of incidents and problem records, from recording to closing. IT service desk tools automate the process of identifying the individual or group responsible for resolution, suggesting possible resolution scenarios and escalation, if necessary, until the service-and-support request is resolved. Typical IT service desk suites extend incident and problem management to Web self-service, basic SLAs, end-user satisfaction survey functionality and request management. ITSM suites also offer integration with event, inventory discovery, knowledge and PC life cycle management modules. Furthermore, the IT service desk is considered an important function in ITIL v.2 and v.3 best-practice process frameworks.

As highlighted, most ITCM tools are modules offered within IT service desk suites and provide integration with incident and problem management. ITCM tools offer functionality that governs documentation, review, approval, coordination, scheduling, monitoring and reporting of requests for change (RFCs). The basic functional requirements begin in case documentation, with industry-standard assignment capabilities of classification and categorization (such as risk and priority). The tool must include a solid workflow engine to manage embedded workflows (such as standard RFC life cycles) and provide escalation and notification capability that can be executed manually or be automated via business rules. RFC workflows are presented graphically and can manage assessment and segmented approval with the ability to adjust automatically, based on alterations and multitask change records. To assist with managing the large volume of RFC activity, ITCM tools enable workload assignment, scheduling and calendar functionality, as well as the reporting analysis of SLAs and production metrics. Critical integrations with configuration, release and CMDB technologies are required for change management tool success. For example, the categorization of a configuration item within the case log in the ITCM tools will improve risk, impact and collision assessment capabilities via integration with a CMDB. Integration with release management tools provides improved quality and efficiency when ITCM workflow policy automates RFC hand-offs to release. Other critical integrations include configuration audit tools and governance, risk and compliance tools.





Inclusion and Exclusion Criteria
Our criteria for inclusion in this Magic Quadrant are:

Vendors must have an IT service desk offering to support enterprise environments of more than 5,000 employees, as demonstrated by customer references.
The product (see Note 2) must include modules for incident management, problem management, change management, inventory management, self-service, knowledge management and SLA management. Vendors' customer references must have incident management, change management and at least two of the other modules in production.
Vendors must generate client interest and inquiries sufficient enough to be noticed by Gartner analysts. Analysts must also receive feedback from enterprise clients indicating that they are using the products.




Added
IBM and Service-now.com were added.






Dropped
Oracle's PeopleSoft HelpDesk was dropped.