A New ERP Market: The Federal Government

Federal ERP spending is expected to grow 33 percent, from $5.8 billion to $7.7 billion, by 2010, according to a report by analytics firm INPUT. According to the report, in the government sector the Office of Management and Budget (OMB), and the administration's Financial Management and Human Resources Management initiatives, will be the financial drivers of these investments in the ERP market, due primarily to the Management Agenda, a presidential strategy designed to improve the management of the federal government. In the past the federal ERP market has been dominated by spending on large supply chain management programs in the Department of Defense. Now agency focus is shifting, placing importance on areas of financial management and human resources management in the government. At a 6 percent annual growth rate, the ERP market is growing slightly faster than overall IT spending.