Report: Government spending on ERP will rise

The federal market for enterprise resource planning solutions will grow to $7.7 billion in fiscal 2009, according to a research report due out next week. That figure marks a 37 percent increase over fiscal 2004 spending of $5.6 billion.

The report, published by Input Inc. of Reston, Va., finds that professional services will account for more than half of ERP spending, up to $5.1 billion in 2009. Input bases its prediction on an increasing need for systems integration to make ERP solutions work across business functions.

The Homeland Security Department will be the biggest civilian consumer of ERP products and services, based on its efforts to consolidate redundant systems among its 22 agencies, according to the report. However, ERP spending by the Defense Department will increase faster than that of civilian agencies.

Spurred by growth in financial and supply chain management procurements, Input expects defense spending on ERP to reach $2.7 billion in 2009.

"The President's Management Agenda and its five areas of focus ? workforce management, competitive sourcing, improved financial performance, expanded e-government and budget and performance integration ? are to credit for the healthy market for ERP," Chris Campbell, senior analyst at Input, said in a statement. "We expect this growth to continue regardless of what the November elections bring."