BARC Scores: Supporting You in the Evaluation and Classification of Software Markets
Dr. Christian Fuchs and Regina Schmidt explain the methodology behind our BARC Score software vendor evaluations
Are you looking for the right software solution to meet your requirements? The evaluation and classification of software solutions and providers is anything but trivial. With BARC Scores, BARC supports your company in its software selection project and condenses detailed analyst knowledge together with extensive survey results into a unique graph. BARC Scores aim to provide a quick and clear overview of a specific software market.
In order to obtain a thorough assessment of a software market, in addition to the experience and detailed knowledge of BARC analysts, the feedback of user companies that work with the software solutions on a daily basis is incorporated into our evaluation. BARC bases its assessment on the world’s largest surveys on the use of BI, analytics and planning tools: ‘The BI & Analytics Survey’ and ‘The Planning Survey’. Each year, both surveys ask thousands of user companies around the world about their satisfaction with the software solutions and providers they use.
The vendors considered in BARC Scores must meet a number of requirements. In addition to a minimum level of license and maintenance revenue, these include, above all, a vendor’s geographical spread and reach as well as its coverage of specific functional areas. This ensures that our analysis focuses on market-leading vendors with frequently used products that do not specialize in just one geographic region or industry and offer a comprehensive range of functions.
The evaluation criteria
Each vendor is evaluated on the basis of two dimensions: ‘Portfolio Capabilities’ and ‘Market Execution’. Each dimension represents an axis in the Score graph and is subdivided into numerous, weighted sub-criteria that together determine a vendor’s position on the graph.
‘Portfolio Capabilities’ on the X-axis comprise sub-criteria that focus on a product’s (or product portfolio’s) range of functions, but also on technological features as well as its overall architecture and ease of use.
The ‘Market Execution’ assessment on the Y-axis includes a mix of product, sales and marketing strategy, as well as organizational, financial and geographic factors. Customer satisfaction with the vendor and its solution, which is derived from BARC product survey results, is a heavily weighted criterion.
The evaluation of vendors and solution portfolios based on these two dimensions determines the positioning in the Score chart. This reflects the current market position and performance of a vendor as well as its performance strength and the integration of its product portfolio in the respective market segment.
The Score segments
Depending on their score on the two axes, vendors are placed in one of five segments, which reflect their stage of development in the market.
For example, the lower left corner features vendors that are still new to the market (‘Entrants’). Compared to market-leading competitors, they are characterized by an incomplete product portfolio or a small presence in the market.
‘Specialists’ are typically smaller vendors with a specific product focus on selected market segments. They may be either limited in their functional and technical capabilities or focused only on selected geographic regions rather than the global market.
‘Challengers’ can be smaller, innovative vendors with a promising portfolio but limited sales and marketing resources, as well as larger vendors that have entered a new market through acquisitions.
‘Market Leaders’ are well-established vendors who have achieved strong market penetration. Their product portfolio enjoys a high degree of recognition on the market and covers an extensive range of integrated technologies and requirements. Market leaders usually have a large market share, which makes them a serious competitor in almost all implementation scenarios.
In the upper right corner are ‘Dominators’. These are vendors that actively shape and influence both technology advancement and market development. They offer market-leading and market-dominant products, world-class sales and marketing programs, a strong partner network and ecosystem, and a rock-solid financial position. They are considered a competitor in virtually every software selection and implementation planned.
The new BARC Scores for ‘Integrated Planning & Analytics’ and ‘Financial Performance Management’ will be published soon
In upcoming blog posts, we will inform you about ‘BARC Score Integrated Planning & Analytics (IP&A)’ and ‘BARC Score Financial Performance Management (FPM)’, which will be published soon. These BARC Scores focus on hot topics. In the last 18-24 months, many companies have recognized the importance of professional and integrated software support for planning and forecasting, analytics and performance management. Market dynamics and competition are rapidly increasing and many organizations are struggling to keep up.
Well-founded decisions based on current forecasts and data analytics, the efficient evaluation of possible future developments in scenarios and simulations, and the automation of processes are becoming massively more important. This applies to both operational and financial use cases.
Companies looking for integrated solutions for planning, budgeting and forecasting as well as business intelligence and analytics should pay particular attention to ‘BARC Score Integrated Planning & Analytics (IP&A)’. Organizations whose focus is on improving their financial performance and efficiency and who are pursuing the integration of financial planning, financial consolidation and financial reporting should look out for ‘BARC Score Financial Performance Management (FPM)’.
Other posts in this series
Part 1: BARC Scores: Your Support for the Evaluation and Classification of Software Markets (this post)
Part 2: A Sneak Peek at the 2022 BARC Score Integrated Planning & Analytics (IP&A)
Part 3: A Sneak Peek at the 2022 BARC Score Financial Performance Management (FPM)
Part 4: Selecting the Right Software with BARC Scores