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Aiming business apps at consultants

A growing number of start-ups are launching new Web-based software to meet the needs of a mushrooming army of IT consultants.

A growing number of companies are seeing green in giving IT consultants their own kind of supply chain management software.

To date, most business software today has focused on the needs of manufacturers. But Opus 360, Evolve, and Niku are among a growing number of start-ups that are launching new Web-based software to meet the needs of a mushrooming army of IT consultants.

These new firms are selling software that helps consultants make sense of a complex problem: identifying which employees, each with specific skills, can be assigned to which projects and for what period of time. The software promises to complete a host of tasks, including helping consultants analyze business cases; manage their staff, projects, and resources; track and resolve problems; and complete progress and expense reports.

For example, Netscape's professional services employees are testing Evolve's software for staffing and managing IT projects and IT services firm Whittman-Hart plans to pilot the firm's software this summer to manage customer opportunities and service delivery.

International Data Corporation analyst Judy Hodges said these start-ups are targeting a hot new area with a profit potential that could lure heavyweight front-office companies to compete in the market as well. IDC estimates the so-called Enterprise Service Automation (ESA) market will exceed $1.3 billion by 2002.

Redwood City, California-based Niku, founded in January 1998 by former Oracle executive Farzad Dibachi, has high hopes for the market. Dibachi made his start-up debut with the information appliance company Diba, which was sold to Sun Microsystems 18 months after its launch.

Niku now has two offerings that target independent IT consulting firms and internal IT organizations.

Niku customers include database software maker Sybase and IT consulting firms Neptune Technologies and SE Technologies. The company has alliances with Sun Microsystems and Silicon Valley software maker AvantGo, which plans to make Niku's products handheld-friendly by summer. Dibachi said the market for IT consulting software could be worth $60 billion, though most analysts haven't looked that far ahead yet. Niku is charging a lofty $2,500 per desktop for its software.

Meanwhile, upstart rival San Francisco-based Evolve, announced general availability of its flagship Web-based product ServiceSphere last month, which it is testing with customers such as Netscape, Whittman-Hart, and global medical product provider Becton Dickinson. Evolve, which just collected $10 million in venture capital from Sierra Ventures, estimates the average company can boost profits by $12 million annually by deploying the company's tracking and management software, which is priced at $1,000 per worker.

Evolve's business partners include Borland, Microsoft, Sun, and Symantec.

Meanwhile, New York-based Opus 360, launched last month with $11 million in venture capital, is headed up by 30-year-old Ari Horwitz. Horowitz worked on teams that built three technology companies acquired by EMC Corporation, Qwest Communications, and USWeb/CKS.

Opus 360 plans to soon release Web-based workgroup management products that provide an interface to financial applications from Oracle, SAP, and PeopleSoft.