Magic Quadrant for the IT Services Desk, 2007

Customer requirements for an IT services desk tool have moved beyond only incident management features and functionality to a broader array of IT support and management functionality. Incident management tools with the capability to open, categorize, escalate, close and report on service and support tickets have matured greatly through the 1990s and this decade and have become largely commoditized. Not surprisingly, IT services desk vendors have invested little in innovation to incident management and, instead, have focused on minor enhancements in the other core IT services desk areas of problem, workflow, SLA, self-service and knowledge management. Additionally, the vendors have committed resources to integrating their service desk tools with related ITSM modules, including change, inventory and configuration management, to create a full suite of tools.

Enterprises continue to purchase service desk tools as part of a larger ITSM strategy (often the result of an ITIL initiative). Integration with additional service management modules is a core requirement in a customer's vendor evaluation criteria. Additional vendor selection criteria include out-of-the-box features and functionality, pricing, ease of configuration and customization (see "Questions on Implementing IT Service Desk Tools"), scalability and the depth of partnerships with third-party vendors for ancillary tools.

The ongoing consolidation of service desks within large organizations
The IT organization's goal of an integrated suite of service management tools over point solutions
The purchase of additional modules, such as problem management
Organizations' discovery that a new service desk implementation is easier and more cost-effective than trying to upgrade old, often-neglected service desk tools to the latest features and functionality

Many organizations that purchased service desk tools in the late 1990s and early 2000s from vendors such as BMC, CA, Clarify (now Amdocs), HP, Peregrine (now HP) and Vantive (now Oracle) have not kept up on new releases and often have highly customized these solutions throughout the years. These organizations are finding that the cost and complexity of upgrading their solutions, coupled with the high maintenance fees they may be paying, make the prospect of starting from scratch with a new vendor and new, out-of-the-box implementations very attractive. This upgrade predicament will enable other enterprise IT services desk vendors, such as Axios, FrontRange (ITSM), IBM, iET Solutions, Infra and Touchpaper to gain market share.

The enterprise service desk market is still dominated by BMC (Remedy), CA and HP, which, collectively, have more than 50% of the total market. Unfortunately for these three vendors, their solutions are often perceived by customers (who mostly remember the older, more-troublesome versions of there products) as being expensive, overly complex, hard to implement and costly to maintain. Even though these three vendors continue to make the shortlist of most customers' evaluation process, one of these vendors' solutions is commonly being "ripped and replaced." Traditionally, midsize market vendors, such as Axios, FrontRange (ITSM), iET Solutions, Infra and Touchpaper, are winning more and more enterprise deals because their products have caught up with BMC (Remedy), CA and HP in terms of features, functionality and full ITIL suite offerings, and they often offer lower licensing and implementation costs.

Interestingly, the enterprise service desk market is becoming more competitive, with entrants such as IBM (with its acquisition of MRO Software in the fourth quarter of 2006; see "MRO Software Acquisition Extends IBM Into Enterprise Asset Management and Fills IT Operations Gaps") and Service-now.com. Both vendors have fully functional products that are relatively new to the market and lack the customer references needed to be included in this Magic Quadrant. The SMB market for the IT services desk continues to be fragmented, with more than 40 vendors fighting for market share.

IT services desk tools offer core functionality for incident and problem management to administer the life cycle of service and support requests from ticket opening to closure. Foundational capabilities include classification, categorization, business rules, workflow, reporting and search engines. IT services desk suites will extend incident and problem management with functionality for Web self-service, knowledge management and SLA management. Additionally, service desk tools will offer integration with other ITSM modules, including change, configuration, inventory, asset, event monitoring and desktop management.

Vendors must have an IT services desk offering to support enterprise environments of more than 5,000 employees, as demonstrated by customer references.
The product must include modules for incident management, problem management, change management, inventory management, classification, categorization, business rules, workflow and search engines. Vendors' customer references must have at least four of these modules in production.
The vendor must generate client interest and inquiry sufficient to be noticed by Gartner analysts. Analysts must receive feedback from clients indicating that they are using the products.

With IT services desk tools, a vendor's product features and functionality, customer focus, R&D investment and sales execution are important indicators of its ability to execute. Gartner evaluates service desk vendors on the quality and effectiveness of the processes, systems and procedures that enable the vendor's performance to be competitive and to positively affect revenue, retention and reputation. Special emphasis was placed on functionality and ease of use with problem management, reporting, workflow, knowledge management, service-level management and self-service. Gartner verifies a service desk vendor's ability to execute through extensive interviews with the vendor's clients and potential customers.

Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria

Weighting

Product/Service

high

Overall Viability (Business Unit, Financial, Strategy, Organization)

standard

Sales Execution/Pricing

standard

Market Responsiveness and Track Record

low

Marketing Execution

standard

Customer Experience

high

Operations

no rating

Gartner evaluates vendors on their ability to articulate logical statements about current and future market direction, innovation, customer needs and competitive forces, and how well they map to Gartner's position. Vendors are rated on their understanding of how market forces can be exploited to create opportunities for the provider. The completeness of vision axis reflects each service desk vendor's prospects for success by analyzing its view of the market, its ability to differentiate products, its strategic plans for growth and service improvements, and its emphasis on best practices and the ease of implementing, not just on product features. We examine build vs. buy strategies for augmenting functionality, knowledge of core competences and the ability to partner to fill gaps in the product portfolio.

Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria

Weighting

Market Understanding

high

Marketing Strategy

standard

Sales Strategy

standard

Offering (Product) Strategy

high

Business Model

standard

Vertical/Industry Strategy

low

Innovation

standard

Geographic Strategy

no rating

Leaders are financially viable vendors with a broad portfolio, significant market share, a high degree of visibility, a clear vision for how the IT services desk will evolve and a proven track record for delivering service desk solutions. They are well-positioned with their product portfolio, are likely to continue to deliver leading products and will continue to appear on numerous customer shortlists. Leaders do not necessarily offer the best solution for every customer requirement, but their products are strong, overall, with some exceptional capabilities.

There are no leaders in the 2007 IT services desk market (BMC Remedy falls on the line between leader and challenger) because no vendor has been able to deliver the vision, differentiation, functionality or innovation required to propel itself into the Leader's quadrant. IT services desk products have become similar as the vendors' products have caught up with each other, and customer prospects often have a difficult time selecting one vendor over the other because the products are so similar. Rather than improving the core features and functionality of their service desk offerings, vendors have focused on delivering strong functionality into a broader suite of ITSM and ITIL modules, such as configuration management database (CMDB). For example, during the past year, the vendors have made only slight, incremental improvements to data collection, reporting and management dashboards, even though better reporting has been a top requirement for most service desk customers. The majority of service desk vendors are also struggling with how to implement self-service and knowledge management to lower their costs and increase customer satisfaction, but service desk vendors have been slow to offer the features, functionality, best practices or partnerships to help customers reach those goals.

Challengers have strong market capabilities, competitive pricing and good solutions for the IT services desk market. However, the solutions do not reflect a clear vision of how the service desk market is evolving, and they are not as innovative or advanced as those of leaders. Vendors in this quadrant excel in their ability to execute, leading to their high market share and appearance on numerous shortlists. That ability is bolstered by overall fiscal health and a superior track record for market responsiveness and customer service.

Visionaries demonstrate a clear understanding of the IT services desk market and provide key elements of innovation that illustrate the future of the market. However, they lack the ability to influence a large portion of the market and execute with the same capabilities as vendors in the Leaders quadrant. There are no vendors in this year's Visionaries quadrant.

Axios is a privately held company and is challenged to keep up with larger competitors on market growth and spending on marketing, sales and R&D initiatives.
Axios has few strategic partnerships with other enterprise technology vendors, ITSM product vendors and professional service implementers, which hampers its market growth and excludes it from very large deals.

The Magic Quadrant is copyrighted 23 August 2007 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner’s analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the “Leaders” quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

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