Wednesday, October 08, 2008

Focus On SaaS

I just got off the phone with world renowned analyst Amy Wohl - and she had some very interesting insights into where SaaS (Software as a Service) is headed in the enterprise world.

As part of the research for her new eBook about the SaaS trends and technology - she and her staff have talked to dozens of SaaS vendors and SaaS technology companies to get their take on where things are going.

PLUG: Check out her website: for availability of the eBook - it should be coming out in the next couple of days (IBM has already bought several thousand copies to give to their customers).

Amy believes that the SaaS adoption rate will continue to climb - even beyond the numbers projected by other analysts like Gartner. She pointed out that in the enterprise - the choice for the adoption of a SaaS solution is driven by whomever has the budget - and not necessarily just about what "IT wants."

As a software entrepreneur that brings up the classic question: What are YOU doing about a SaaS strategy? Do you have one?

If you don't have a strategy - that that becomes your strategy. Not having a plan about what you're going to do about on-demand software is just plain bad business. Even if you decide that SaaS isn't somewhere that you want (or need) to go into - at least you have a plan and a strategy.

If you do decide you want (or need) to go into the on-demand marketplace - there are a lot of other considerations:
  • How much work will I need to do to my current application?
  • Do I even use my current application - or create a new one - just for SaaS delivery?
  • How will I host it - in the cloud (e.g. Amazon), at a service provider?
  • What about SLAs (Service Level Agreements) and guaranteed up time?
  • How am I going to charge for on-demand and still make money?
  • Can I just continue to charge my customers like I do now, and charge them an additional fee to host the app?
  • How am I going to market the new service?
  • Will I cannibalize my on-premises customer sales?
  • What do we think the adoption rate will be among current customers?
  • Should be consider making our application a "white label" product to sell to other providers (or competitors) as well?
  • ... etc., etc., etc.

There are no easy answers - but now's the time to take a good long look at where you're going with your business - and how you can maximize your strengths. It might even be a good time to branch out into other related services or industries with similar needs to the one you're currently serving.

The time to plan is now. The time to take action is now. The health and well-being of your business depends on it.

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