The SaaS Report

There are many well-known benefits of SaaS solutions such as subcription pricing, faster implementations and greater user adoption. One that is rarely mentioned is the multiplier effect for niche partner solutions.

As an example, take an HR application. If a niche vendor comes in to introduce a complementary application to say automate performance review approvals. With traditional on-premise, the niche vendor has to not only test the integration with the HR application but must do so for all possible platforms and configuration options. In addition, the actual integration must be performed on-site raising the cost of the solution to the customer. This means that certain add-ons are not worth being bought but can be better built as custom enhancements by the customer.

With SaaS, the integration is easier to develop using web services standards and is easier to test since the application is available to the partners. In my past role as an EAI specialist, I recall spending days and weeks waiting to get access to an instance of the application to integrate with. Once the integration is done, the niche solution provider need not repeat the exercise for every customer. This allows many small applications to become available with benefits to customer, partner (vendor) and the SaaS appliction vendor.

• Customer: The customer can simply pick and choose  the add-ons they need to conduct business. They do not need to wait for IT or the application vendors.
• Partner: The partners of the SaaS application can bring a solution to the market faster, test it easily and roll it out at a lower cost per customer. This enables the long tail of solutions to become economically viable.
• Application Provider: The greater the number of partner solutions enhances the value to the customer making the core application even more valuable.

Okay, so I agree that this post is stale news by blogging standards - as in over 2 days late.
And yes, there are no revelations in this piece- just a few notes on
the Software 2007 conference this past week.


The Software 2007 conference this week was a great experience. M R put up a great show with some marquee names like Ed Zander from Motorola, Marc Benioff from Salesforce and Steve Ballmer from Microsoft making appearances. Even though this year's theme was Innovation - the star of the show was SaaS.

It is becoming increasingly clear that the ISV community and the platform players expect SaaS (or WebWare) to be the next key determinant of which ecosystems will flourish or perish.

The event included some very interesting sessions including - the role of private equity; SaaS and the channel - maximizing the opportunity while navigating the obstacles of on-demand delivery. The session on 'Israel, China, India and the UK: The New Leaders in Software Innovation?' was the most controversial. Ganesh Natarajan of Zensar, India spoke softly and presented both sides of India's success story and potential dangers including need to invest in talent. David Scott Lewis, Senior
VP, Startech Global
Corporation, China was very provocative and clearly wanted to stir up a storm in a Chinese Tea cup (or British?). Although I disagreed with many of David's arguments, he clearly was very passionate about how he saw China and his company growing in outsourced product development over next few years.

Personally for me, the highlight was meeting with some of my blogging buddies from the Enterprise Irregulars, a club that I am a proud member of. It was nice to finally meet Jeff Nolan, Vinnie, Chris Selland, Sadagopan and  Zoli Erdos in person. We often exchange ideas over email and are constantly in touch. (My other blog at anshublog.com has the details.)

Vinnie has written an excellent piece, The Innovation Disconnect, on how the CIO's see Innovation as opposed to the vendors view. Sadagopan reports on the closing remarks by McKinsey.