With the Sourcing and Vendor Management Forums coming up next week in Miami and at the end of the month in London, our team is busy finalizing content and rehearsing sessions. Personally the hottest question I have continued to get since the keynote I did last year on SaaS sourcing is the question of SaaS pricing and contract negotiation. So, what can you expect in the track session “Negotiating Cloud Pricing and Contracts” for those of you who can join us?

New data from the Q3 2011 services survey showing:

1. SaaS is disrupting spend on traditional services. Nearly half of the firms we surveyed say that “as-a-service” spending has reduced spending on traditional on-premises IT spend. And, these firms also say that it will have a noticeable disruptive impact. Out of the firms who say “as-a-service” spending will reduce spending on traditional spend, 30% say this disruption will be 6% or more.   
2. SaaS adoption has expanded into IT applications and industry-specific applications. Firms are now using SaaS for an increasingly wide range of solutions: horizontal applications like CRM and HR and collaboration applications like email still dominate the trend but now 13% of firms use SaaS for IT software such as asset management and 10% of firms use SaaS for industry-specific solutions such as insurance claims management.
3. Firms are centralizing their approach to SaaS sourcing and vendor management. The recently gathered data shows a strong trend towards centralized SaaS strategy and formal multi-year plans around SaaS. Not surprisingly, this data also shows that firms expect to see a decrease in unsanctioned, business-led buying.  

In my recent blog on the top 50 ITIL adoption mistakes many related to the people-side of changing the IT service management (ITSM) and IT delivery status quo. In many ways, people are the ultimate barrier (or success factor) to effective ITIL adoption or to other aspects of an IT infrastructure and operations (I&O) organization successfully meeting business demands for IT services.

We often get the technology and process elements of what we do in I&O right, but the people-side of things can be a different matter. Paul Wilkinson of GamingWorks has been a champion for addressing the ABC (attitude, behavior, and culture) of ICT for many years and he shares his (and his colleagues) thoughts with us below.

So what goes wrong?

As more and more organizations adopt ITSM frameworks such as ITIL, it often seems that ITIL or the framework is the goal itself, rather than being a means to an end – that is trying to improve the delivery of IT services from a business perspective.

Paul states that, in his experience, 70% of ITIL-adoption initiatives fail to deliver on their promises, i.e., realizing the value that the I&O organization (and business) had hoped for; with 50% of failures caused by resistance. However, we (the people) tend to blame the framework or the technology. But it often has nothing to do with ITIL – the root cause is commonly the way in which we (mis) apply and (mis) use the framework. That these failures are often down to people issues.

Music is a very important part of my life. At home I've always got something playing on the sound system, I never go anywhere without headphones, and my music collection takes up more space in my house (not to mention on my computer) than anything else. That's why on a recent trip up to Maine – a 4.5 hour ride from Boston – the first thing I did to prepare was make sure I had my phone for music on the drive, without which I'd be stuck with the radio. Having to listen to the same 40 songs for four and a half hours is something that could easily give me nightmares but it got me thinking about how much choice matters.

Ten years ago I would have been happy enough with just the radio. Then came Napster and the iPod and my world changed. I became aware the technology existed which meant I knew there was a better alternative to the radio. What's more, I was excited about it. I wanted to use my iPod and put new music on it. The product engaged me as it had engaged everyone around me. I think that correlates with what we're seeing today in firms across all industries where employees have long been locked into aging technology – which often doesn't do everything they need it to – by lack of choice.

Comprehensive integration solutions (CISes) have been in the market for several years and provide robust features for solving application, B2B, and process integration challenges. But what a lot of people don't yet understand is that these tools can also dramatically speed up general-purpose application development efforts as well. Savings of 40% to 60% reduction in time and cost are frequently quoted by enterprises using a CIS for application development. How is this possible, you ask?

CIS products provide several tightly integrated components that can speed up development efforts, including:

• A graphical environment that supports model-driven development. This approach replaces manual java coding with dynamic interpretation of java code based on process models created in either BPMN or BPEL diagrams.
• An embedded ESB that provides out-of-the-box features supporting messaging, routing, and transaction management. ESBs can be used to minimize the creation of point-to-point integration interfaces with a more-flexible service bus approach.
• An integration server that supports both simple and complex transformations with full support for a wide range of EDI and XML-based data formats.
• A registry/repository for supporting the creation, management, and reuse of a wide range of application artifacts, including services.