IDC Finds Workforce Performance Management Market Still Maturing and Still Hot with Revenues Expected to Reach $2.5 Billion by 2012

FRAMINGHAM, MA – MAY 5, 2008 – IDC is forecasting that the market for workforce performance management (WPM) software and services will reach $2.55 billion by 2012, increasing at a compound annual growth rate (CAGR) of 10.1%. Consulting services still make up the largest share of spending given the complexity organizations face when redesigning performance management for strategic advantage. Although the performance management market is maturing with some standardization emerging in terms of vendor offerings, it remains a relatively new market with ample room for growth and innovation.

"Despite a potential business downturn, employee retention will continue to be a key concern for HR executives in 2008, given the very real demographic shifts occurring in the workforce," says Lisa Rowan, program director, HR and Talent Management Services. "Employers will be seeking ways to both automate and integrate talent functions, with the goal of identifying and retaining top performers. Performance management is a linchpin in this process."

Other key trends examined in this IDC report include:

* Popularity of the software as a service (SaaS) model is growing and surveyed vendors report that on average, 82% of their performance management implementations are delivered via SaaS.

* Performance management still has the highest buyer interest of the talent management offerings while many vendors are reporting buyer interest in integrated talent management even if buyers are not yet in a position to implement all functions simultaneously.

* Vendors are advised to pay special attention to the various client constituencies served. There needs to be something in it for everyone, especially the employees, if a project is to be successful.

This IDC study, Worldwide Workforce Performance Management Forecast 2008-2012: Still a Hot Market (IDC #211971) provides IDC's forecast for the worldwide workforce performance management (WPM) software and services market. The forecasts presented in this study represents IDC's best estimates and projections for 2008–2012 and are based on reported and observed trends and events in 2007 and their predicted effects on the workforce performance management (WPM) market for the five-year period as well as in-depth vendor responses to an IDC-created survey on the WPM market and offerings.

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