Business Issues -> Change
By: Martin Banks, Associate Analyst - Datacentre & Mainframe, Bloor Research
Published: 9th September 2009
Copyright Bloor Research © 2009
It is not uncommon for established software vendors to suggest that SaaS is really only a new way of delivering applications. Up to a point it is true, but it is actually missing an important point that the prevailing view of SaaS from the industry still shows too much concentration on the 'software' component and not enough on the 'service'.
Service creation starts with a very basic question: 'why invent/create/develop X in the first place?' It is the antithesis of that dreadful phrase beloved of marketing suits—'cool technology'. But so much cool technology ends up frozen is aspic because, while it may be clever, it achieves very little of lasting value to man or beast.
The importance of service is that it is what the users actually want—OK, a business user wants; consumers will buy cool technology just to be seen as someone smart/savvy/rich enough to have it. What businesses want is a service that solves a problem and saves them having to worry about it, work round it or try and solve it themselves. So the key factor for any vendor moving into the service delivery area is to look beyond their particular contribution or technology to identify the entirety of the service required.
A good example of this is Intralinks in the data management space. It was quite refreshing to talk to the company's senior management and suggest what might been the ultimate insult: 'there is no new technology or development in this offering', and have them agree with a smile. New technology is not the issue here, for having yet another new technological trick for managing data can be as much of a hindrance to potential users as a help—probably more so these days.
This is particularly so if the primary target market is largely based on the financial community and, in particular, those companies involved in managing acquisitions and mergers. For them getting it right, and all of it right, is more important than doing it as fast as some technologies might allow or being seen to use the latest 'cool' technology. This has to be particularly true in the area of data management, where the integration and interoperability of components of the service is far more important than just one technology advance such as speed. So the service the company has to pitch at is getting it as right as possible.
And that is, ultimately, what any service has to provide for its users. Being as right as possible means not just building a service that is fit for purpose, but actually understanding the full nature of the purpose. Taking Intralinks as an example, its purpose is not providing reliable and secure data management tools, instead it is the provision of a soup-to-nuts environment in which all relevant communications can be conducted reliably and securely, and all the information generated by those communications can be stored and made available in a reliable and secure fashion.
So what all service providers need to think about now, in addition to any technological excitements, is what constitutes the service they want to offer or be part of—where does the soup start and the nuts end so that a logical and tidy service encapsulation is created? That will almost certainly mean forming business partnerships, perhaps even the occasional judicious acquisition, but the long term winners will be those service providers that can get customers to acknowledge: "we had a problem with that part of our business, but we no longer have to worry about it."
In the end, or perhaps more accurately the new beginning, providing services to customers is about providing an important contribution to their business assurance.
Posted: 14th September 2009 | By John Hack :
Intralinks has one other unique SaaS characteristic: the service could not be provided on premise. Having a secure, neutral party host such sensitive data is a core part of the value proposition (Bank A wouldn't be comfortable with the data being hosted on premise by Bank B in a multibank deal).
SaaS is particularly compelling if it doesn't just replicate on-premise software, but creates value by leveraging the network.
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