Companies in most all industrial sectors must manage environment, health & safety (EHS) and sustainability information. Managing this information manually is not an option for most organizations, so a niche software market has evolved over the past 20-plus years. Today, the EHS software market accounts for billions of dollars in annual license and subscription revenue and implementation fees.
Big investment in EHS software companies fuels market changes
Between February and June of 2016, we saw several announcements of major mergers, acquisitions, and investments in this market. These large investments can change the EHS software market as we know it:
Investors and software industry analysts alike are paying attention to the EHS software market niche. These significant investments mean that “green”—environment and sustainability—is good for business.
Market leaders exhibit six traits
With all of this investment in the market, which companies will take the money and run, and become the new market leaders? Investment alone does not make a company a leader; money can enable success or it can get in the way. I submit that a new breed of market leader will emerge, and must exhibit six traits.
The new breed of EHS software market leader must exhibit six traits; vision, adaptability, innovation, a customer-centric view, knowledge base, and intellectual capital.
1. Vision. Formulating a vision requires questioning the status quo. Executing that vision requires leadership, a great team, business processes and technology. Communicating the vision internally and externally is critical to success.
2. Adaptability. Internal issues can quash the impact of new investment. Vendors that can quickly integrate and absorb the organizational change will have more success than vendors that cannot. Adapting to external issues like regulatory and market changes is equally important.
3. Innovation. Customers expect more of software today than ever before. Mobile and Cloud capabilities are the rule, not the exception. Usability is king. Vendors that offer innovative, but not bleeding edge, solutions can capture market share over competitors that use older technology platforms.
4. Customer-centric. Vendors that look outward towards market and customer needs—and innovate to meet these needs—will become the new leaders.
5. Knowledge base. Vendors must have a team that understand subject matter, IT, and business issues in the sectors they serve. Vendors that lack knowledge in some of these disciplines will fall short.
6. Intellectual capital. Hiring the “best and brightest” is not enough. Vendors need to invest in developing employee skills to execute the company vision.
Exciting times ahead
Companies in most all private and public sectors must manage EHS information, and the EHS software market accounts for billions of dollars in annual license and subscription revenue, plus implementation fees. Think of it as a sleeping market that recently awoke. It will be exciting to see how 2016 investment invigorates this niche market, and which vendors emerge as leaders by 2020.