TECH SUPPLIER Dec 2022 - Market Forecast - Doc # US49945622

Worldwide Project and Portfolio Management Software Forecast Update, 2022–2026: 1H22 PPM Growth Drives Higher CAGR


Melinda-Carol Ballou

This IDC study provides a 2022–2026 forecast for the worldwide project and portfolio management (PPM) software market, which grew 12.8% to $5.2 billion in 2021 in current currency (compared with growth of 6.3% to $4.6 billion in 2020). We see significant uptake of PPM in the cloud, which will continue throughout the forecast period. This growth is noteworthy in an unpredictable, challenging, and dynamic market. Decision making in volatile financial and geopolitical environments demands effective prioritization; the radical shift to hybrid work and digitization demands commensurate management and governance of resource, programs, and portfolios for global enterprises, along with agile value streams. We saw high engagement of revenue growth from major and key innovative smaller PPM vendors in 2021, with few exceptions. The increasing role and complexity of sourcing for projects, programs, and portfolios in the enterprise and the need to align with business needs and corporate governance and regulatory requirements with hybrid work have combined to retain growth for PPM as the global economy shifts with higher engagement remain in flux with volatile worldwide politics. IDC has seen increased alignment of strategic PPM with enterprise resource planning (ERP) (including professional service automation [PSA]), the evolution and rapid uptake of SaaS PPM, increased coordination with application life-cycle management (ALM), and agile value stream management (VSM). Significant growth driven by collaborative work management is exemplified in vendors such as Citrix Wrike, Smartsheet, Asana (with revenue in team collaborative applications),, Adobe Workfront, and Clarizen. Agile and service management vendors have been leveraging PPM and PSA through alliances, integration, organic development, and/or acquisitions. This continued to have an impact in 2021 and will play a role in market growth through 2022–2024 (exemplified in the recent acquisition of Tasktop by Planview in 2Q22). We expect PPM in that time frame to also play a synergistic role increasingly with new product development and the evolving Internet of Things (IoT) arena as well as governance for DevOps as organizations must increasingly coordinate software deployment from inception to deployment and service management (with an increasing range of platforms on which to deploy — from mobile, social, and cloud to "things").

"Global 2000 organizations continue to struggle with the complexity of project, program, and product delivery while seeking to manage economic and political volatility as operational and business needs change dynamically in the context of the global COVID-19 pandemic and geopolitical upheaval. We saw both acquisitions and IPOs in the PPM and CWM areas during 2020 through 1H22 as a result. Agile management of human, financial, and other resources is key. In response, demand will remain ongoing for PPM tools across the PPM segments ranging from IT PPM, Collaborative Work Management (CWM), agile PPM, and value stream management (VSM), professional service automation (PSA), and new product development to capital projects and engineering and construction. Smaller vendors will play a core role in product and market innovation, including CWM, PSA, and agile, and differentiated PPM solutions will come into play in that context as further consolidation and product evolution occur. With high growth already seen in 1H22, we therefore expect for this relatively mature market an increased CAGR of 9.6% (up from prior estimates of 7.3%) for the 2021–2026 period to reach projected revenue of $8.15 billion," says Melinda Ballou, research director, IDC's Agile ALM, Quality, and Portfolio Strategies service.



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