Market Intelligence within Software Procurement

Abstract: With the dawn of the digital era, software solutions are becoming of increasingly strategic importance for corporations, and due to the complexity of the products and the huge lock-in effects which they often give rise to, software-procurement is growing into a critical activity. However, due to the phenomena of information overload, finding and making use of the right information when making strategic decisions is becoming increasingly difficult, resulting in the need for organizations to overlook their information processing capacities in order to ensure the quality of such selections. For this purpose, Ingka Group Procurement Digital & Tech: Software Category has identified a need for a Market Intelligence function within the division, and this thesis aim is to explore what activities that function should entail. For this purpose, the thesis aims to identify what the main challenges are related to procuring in software markets, what information needs software-purchasers have and lastly, how this information should best be communicated in organizations related to the information's inherent complexity. This was investigated through a literature review, followed by interviews with both software market-experts and software-purchasers at Ingka Holding. This resulted in an analysis of the software markets and compilation of the identified information requirements, which were then analyzed from an Information Processing Perspective. Recommendations on how to communicate the information were thereafter developed together with a suggestion on what the main Market Intelligence-activities should entail. Lastly, a roadmap for how to implement said function at Ingka is presented.