VARs See Cash In Project And Portfolio Management Apps

Project and portfolio management software, once limited to basic scheduling and resource planning, is becoming a cornerstone technology in business process/workflow management, collaboration and application lifecycle management. That, combined with the PPM market's 10-percent annual growth rate -- reaching $1 billion in 2009 -- spells potential opportunity for solution providers.

PPM is pretty sophisticated stuff and some of the leading vendors in the market, including CA and Compuware, rely on direct sales more than the channel. But some of the newer entrants in this market, including some that have developed on-demand PPM applications, are looking for channel partners to provide implementation and consulting services.

And Microsoft, which already has some 700 channel partners that work with Microsoft Office Enterprise Project (including Office Project, Project Server and Project Portfolio Server), hopes to recruit resellers of its fast-selling SharePoint collaboration and communications platform to add project management to their technology offerings.

The demand is there. "We have far too many active projects going at any one time, which dilutes our resource base and extend our schedules," said Marlo Savage, project management office director at Grand Rapids, Mich.-based Spartan Stores. Savage was among the project management executives attending the Project & Portfolio Summit 2008 conference in Kissimmee, Fla., this week. (The conference is owned by Everything Channel, which also operates the ChannelWeb site and publishes CRN and VARBusiness.)

"We have very ambitious revenue and profit targets. So our challenge in picking a [PPM software] provider is finding a tool that will help us focus on the projects that add value to the business," said George Marmo, regional program manager for Bayer Healthcare, at the conference. His company is currently migrating from a Notes-based project management system to CA's Clarity software.

Project and portfolio management tools are generally used for managing multiple IT projects and their budgets, deciding which projects to fund, reducing administration costs and enhancing resource management, said Gartner analyst Daniel Stang, in a presentation at the conference. Stang said most businesses are in the early stages of PPM adoption and use.

Nevertheless, Gartner estimates that the PPM market is growing 10 percent annually and will reach $1 billion next year. "There's growing demand in the midmarket," Stang said.

CA, Compuware, Hewlett-Packard and Microsoft are the market heavyweights. Some vendors have become players through acquisition: Serena Software acquired Pacific Edge Software in October, 2006 and linked Pacific Edge's PPM software to its application lifecycle management products. Hewlett-Packard's HP PPM Center system includes Kintana PPM tools that came along with its Nov., 2006 acquisition of Mercury Interactive.

Other players include AtTask, Instantis, Planview and Primavera Systems. Several vendors, including Daptiv (formerly E-Project), Innotas and PowerSteering Software offer on-demand PPM applications.

Microsoft's project management product line is the vendor's sixth largest business, said Seth Patton, product marketing manager for Microsoft Project. (He declined to disclose actual sales numbers.) The software giant lists such partners as UMT Consulting Group and Quantum Portfolio Management, among its Microsoft Project partners. They provide a range of integration and implementation, portfolio process management and consulting services. Some provide expertise in specific domains such as IT governance and product development processes.

Microsoft Project Server 2007 is built on Windows SharePoint Services and Patton said the company plans to natively integrate the Enterprise Project line with SharePoint in the future, allowing the application to tap into SharePoint's collaboration, communication, compliance, search and document management capabilities. Patton said Microsoft will recruit SharePoint partners with ambitions to move up-market to also resell Microsoft Project. "We also think there are opportunities for consulting companies that don't work with Microsoft today," he added.

Mentor Graphics, which uses HP's PPM software, relied on solution provider ResultsPositive to handle the implementation work because it could do the work faster than Mentor could using in-house staff, said Mark Kresge, director of Mentor Graphics' IT program management office. "Everything's about speed today," he said.

Daptiv has some partners that handle implementation and setup, training and consulting services, said Timothy Low, marketing VP. Last fall the company added business intelligence capabilities to its project management applications that Low said offers channel partners opportunities in developing reports and dashboards.

While Serena provides implementation and other services for customers, the company wants to focus more on developing its product and leave services to its channel partners, said Chris Baker, senior product marketing manager.