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ARC says LIMS becoming SaaS

June 14, 2009: Leveraging the success of the Salesforce.com model, Laboratory Information Management Systems (LIMS) software-as-a-service (SaaS) will emerge and reshape the LIMS marketplace. End users are increasingly relying on LIMS solutions to increase efficiency, facilitate standardization, reduce support costs, enable data sharing, and support other business requirements.

Historically, LIMS have been delivered using the outright purchase model. The success of Salesforce.com has end users and suppliers reevaluating software acquisition methods. “Small and medium laboratories currently utilizing home-grown systems may find the Internet hosted model a more affordable option for LIMS,” according to Senior Analyst Paula Hollywood, phollywood@arcweb.com, the principal author of ARC’s “Laboratory Information Management Systems Worldwide Outlook.”

Regulatory Requirements Continuously Evolving
Enhancing compliance with regulatory guidelines is a major impetus for acquiring and implementing a LIMS. For multinational companies, keeping pace with global regulations can keep a multi-person staff busy full time. This can be problematic for manufacturers seeking to streamline their compliance efforts while decreasing risk of non-compliance. Evolving regulations require improved documentation of laboratory tests and an enhanced ability to share test results with other departments and third parties in real time. One of the crucial functions of LIMS is the ability to trace each event in the lifecycle of a sample, which is essential in protecting laboratory results and for regulatory compliance.

Proliferation of Web 2.0 Technology
Web 2.0 refers to trends in how World Wide Web technology is used to enhance web functionality and the user experience. The characteristics of Web 2.0 include rich user experience, user participation, dynamic content, metadata, web standards, and scalability. It is the platform for web-based versions of LIMS which the majority of LIMS suppliers now provide for decentralized decision making. Web 2.0 is the backbone of LIMS on demand as it enables syndication of both content and services.

Strong Growth in Emerging Regional Markets
LIMS implementations by multinational and domestic manufacturers and research organizations in emerging markets will contribute to growth in LIMS revenues. As countries in Eastern Europe and Southeast Asia develop a manufacturing base that seeks to compete in the global marketplace, enterprises of all sizes will need systems capable of tracking samples and creating audit trails; providing broad reporting, monitoring and analysis capabilities; and supporting regulatory compliance both domestically and internationally. China, of course, has had some bad press in terms of toy and food recalls in the past year. Manufacturers here will need LIMS in order to prove to foreign partners they have sophisticated quality control procedures in place as well as the ability to trace contaminated product once it has been identified.

About ARC: Founded in 1986, ARC Advisory Group has grown to become the Thought Leader in Manufacturing and Supply Chain solutions. No matter how complex your business issues, our analysts have the expert industry knowledge and first-hand experience to help you find the best answer. We focus on simple yet critical goals: improving your return on assets, operational performance, total cost of ownership, project time-to-benefit, and shareholder value.

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