Company Experiencing Rapid Growth and, According to Independent Research Firm, Positioned to Compete in $800M IT Financial Management Market Segment
Bellevue, Wash. – May 13, 2009 – Apptio, the market-leading provider of on-demand IT Cost Transparency software, was recently recognized by Forrester Research Inc. as a vendor in the emerging IT Financial Management market. With a solution that is specifically designed to address the unique needs of IT financial management and offering the shortest “time to IT cost transparency” in the industry, Apptio is well-positioned in this emerging market. Apptio, already experiencing significant customer traction with Fortune 1000 companies in industries including financial services, healthcare, retail and cloud service providers, also announced that it has crossed the milestone of $3 Billion of customers’ IT budget under management in the Apptio IT Cost Transparency solution.
In its ‘”Market Overview: IT Financial Management Software” report, published May 7, 2009, Forrester Research, Inc. profiles the emerging market segment of IT Financial Management, defined as: “The discipline of planning, budgeting, monitoring and controlling the use of a firm’s total IT budget (operations/maintenance and new projects/investments).” According to the report, Forrester anticipates the market “will exceed $800 million in 2013,” spurred by “business users demanding greater IT cost transparency and financial analysis in order to understand the true cost of IT. They believe the transparency and analysis are critical in enabling them to intelligently manage demand for IT services and participate in cost management decisions.” As IT becomes even more critical to the business and CIOs are held accountable to run IT like a business with transparency in costs (and competitive with externally available services), there is a growing need for solutions that better analyze, manage and report on IT costs and processes.
The Apptio IT Cost Transparency solution integrates best practices on IT Financial Management into workflow-specific applications around IT Service Costing, Business Unit Billing and Demand Management, Service Quality and Utilization Management, and Cost and Performance Benchmarking. By delivering greater visibility into their cost structures, Apptio helps IT managers make better decisions around managing IT, reducing cost and communicating the value of IT to business executives.
“One central element to IT Financial Management is the ability to use activity-based costing (ABC) principles for cost structure modeling,” wrote Thomas Mendel, Ph.D., vice president, research director at Forrester and Peter O’Neill, vice president and principal analyst in the report. “This is essential because of the high percentage of indirect cost in IT services and projects. Without ABC, the trustworthiness of the results will be forever in doubt.”
Apptio has been designed from the ground up with the capabilities IT managers need for effective financial management. The first issue IT faces when trying to gain better transparency into the total cost of IT services is incorporating cost, asset and utilization data from the many different sources in which this information resides today. Apptio simplifies and automates this data collection and correlation, making it easy for companies to get started today, whatever state their data is in. The second key issue important to IT Cost Transparency is the allocation model itself. Apptio’s allocation modeling is sophisticated enough to support activity-based costing or simple manual allocations, and yet flexible enough to be easily customized for individual companies. Finally, Apptio’s data analytics, reporting and benchmarking functionalities take managers beyond flat service cost reports they might get from spread sheets or service catalogues to enable true decision support functionality and “What If” scenario planning for a true Continual Cost Optimization process.
"Understanding the cost of IT services and being able to apply analytics to highlight fundamental cost drivers within a service has allowed us to identify and articulate cost savings opportunities for IT," said John Shepard, director of global IT infrastructure at Starbucks Coffee Company. “Apptio’s on-demand solution is helping us make better and more informed decisions around the cost and ROI of our technology investments.”
“The need for IT Financial Management software is overwhelming. The average Fortune 1000 IT budget is in excess of $350 million, and no one should run a $350 million business without proper financial management systems,” said Sunny Gupta, CEO and founder of Apptio. “Apptio was designed from the bottom up with CIO input to help IT managers run their business based on quality financial information.”
Apptio is the leading independent provider of on-demand Technology Business Management (TBM) solutions for managing the business of IT. Apptio enables IT leaders to manage the cost, quality and value of IT Services by providing deep visibility into the total cost of IT services, communicating the value of IT to the business through an interactive Bill of IT™, and strategically aligning the planning, budgeting and forecasting processes. Apptio's TBM solutions play a critical role in helping companies understand and drive chargeback, virtualization, cloud and other key technology initiatives. Global enterprise customers such as Bank of America, Boeing, JPMorgan Chase, Microsoft, St. Luke's Health System, and Swiss Re rely on Apptio® products and services to reduce costs and align IT with business priorities. For more information, visit the Apptio website or the Apptio blog.