Clients tell us they are turning to SaaS not so much for cost savings but primarily for greater business results: greater business agility and improved collaboration inside and outside the enterprise. But, what can SaaS applications provide that traditional, single tenant applications cannot?
At last week’s Workday Technology Summit, we heard firsthand from some major brands about the unique benefits they are achieving from using a SaaS solution:
1.Continuous innovation. Workday customers talked about two components to this benefit: 1) seamless, frequent, automatic upgrades and 2) ability to deploy changes quickly into your live environment.
The problems Rick identified in CX ecosystems seem to be the result of ossified organizations, cultures, and business relationships. This means CX leaders must drive new levels of responsiveness and creativity into their ecosystems. And the way you drive these attributes into your ecosystems is to seize on the concept of business agility. My colleague Craig Le Clair outlined 10 dimensions of business agility that provide the market, organizational, and process frameworks necessary to embrace market and operational changes as a matter of routine. This is merely setting the strategy, though; executing it requires a marriage between the business and technology strategies.
“Business Intelligence in the cloud? You’ve got to be joking!” That’s the response I got when I recently asked a client whether they’d considered availing themselves of a software-as-a-service (SaaS) solution to meet a particular BI need. Well, I wasn’t joking. There are many scenarios when it makes sense to turn to the cloud for a BI solution, and increasing numbers of organizations are indeed doing so. Indications are also that companies are taking a pragmatic approach to cloud BI, headlines to the contrary notwithstanding. Forrester has found that:
· Less than one third of organizations have no plans for cloud BI. When we asked respondents in our Forrsights Software Survey Q4 2013 whether they were using SaaS BI in the cloud, or were intending to do so, not even one third declared that they had no plans. Of the rest, 34% were already using cloud BI, and 31% had cloud in their BI plans for the next two years. But it’s not a case of either/or: the majority of those who’ve either already adopted cloud BI or are intending to do so are using the SaaS system to complement their existing BI and analytics capabilities. Still, it’s worth noting that 12% of survey respondents had already replaced most or all or their existing BI systems with SaaS, and a further 16% were intending to do so.
Forrester has just published our forecast for the 2014-2015 global tech market (January 2, 2014, “A Better But Still Subpar Global Tech Market In 2014 And 2015”), and we are predicting that business and government purchases of information technologies (IT) will grow by 6.2% in US dollars in 2014, and by 5.5% in exchange-rate-adjusted or local currency terms. (Note that this data includes purchases of computer equipment, communications equipment, software, IT consulting and systems integration services, and IT outsourcing services, but does not include purchases of telecommunications services.) The US dollar growth rate will be distinctly better than the 1.6% growth in US dollars in 2013, though constant currency growth will be only somewhat better than the 4.3% growth in 2013. Still, the global tech market won’t see strong growth until 2015, and even then the 8.1% US dollar and 6.9% local currency growth rates will be well below the double-digit growth rates of the late 1990s and 2000 era.
Three interconnected and reinforcing themes will define the global tech market this year:
salesforce.com’s 100,000+ customers now have a new option for streamlining SaaS sourcing across the enterprise: Private AppExchange. And, the price is right at $0. Free? Yes, free(!) but, don't assume this won't impact your costs.
Last week at salesforce.com's massive Dreamforce event, Forrester had the opportunity to learn more about some of salesforce.com's recent announcements -- including the Private AppExchange. This free add-on feature for salesforce.com users lets companies set up an AppStore that is private, personalized, and custom populated for their own company. The Private AppExchange lets organizations “distribute any app, to any user on any device through a central, secure store, using Salesforce Identity to grant employees instant access to the apps they need. Organizations can customize the store with own categories and branding.”
The Private AppExchange could help sourcing executives address goals for enabling SaaS sourcing that we frequently hear about, such as:
Lets users quickly discover and deploy solutions that meet their business needs
Supports collaboration and idea-sharing across all users at all levels of the company
Adheres to corporate standards (integration, data rules, security, contracting, and more)
Ensures favorable pricing based on overall corporate relationships and usage
Showcases the specific SaaS solutions already in use within the company
Ok, so NASA failed an audit. Don’t we all? I think it is important to understand the government’s cloud computing adoption timeline before passing judgment on NASA for failing to meet its cloud computing requirements. And, as someone who has read NASA’s risk management program (and the 600 pages of supporting documentation), I can say that this wasn’t a failure of risk management policy or procedure effectiveness. Clearly, this was a failure of third-party risk management’s monitoring and review of cloud services.
The Cloud Is Nebulous
Back in 2009, NASA pioneered cloud technology with a shipping container-based public cloud technology project named Nebula -- after the stellar cloud formation. (I love nerd humor, don’t you?)
Photo Source: NASA
During 2009, NASA, to determine if current cloud provider service offerings had matured enough to support the Nebula environment, did a study. The study proved that commercial cloud services had, in fact, become cheaper and more reliable than Nebula. NASA, as a result of the study, moved more than 140 applications to the public sector cloud environment.
In October of 2010, Congress had committee hearings on cybersecurity and the risk associated with cloud adoption. But remember, NASA had already moved its noncritical data (like www.nasa.gov or the daily video feeds from the international space station, that are edited together and packaged as content for the NASA website) to the public cloud in 2009. Before anyone ever considered the rules for such an adoption of these services.
Sourcing professionals already understand the importance of monitoring financial performance to assess risk in their key suppliers’ ability to deliver commitments. Sometimes sourcing professionals can also find valuable negotiation leverage in the financial results of their key suppliers, as is the case with Oracle’s Q4 2013 numbers . In my opinion, the revealing aspects that you can use to increase your bargaining power over the next couple of quarters, include:
I recently had the opportunity to spend some quality time with NetSuite in San Jose at its customer forum — SuiteWorld. The event gave me a long, overdue deep-dive into their current strategy and the chance to speak with many of their customers one-on-one.
The big announcement from the event was the availability of its manufacturing solution. The evening before the event started I had a good conversation with our Sourcing Analyst Liz Herbert — who spends a lot of her life focused on the SaaS providers — and asked her why NetSuite was not growing more quickly. Her response was that its lack of a manufacturing solution is partly to blame. So when it was announced by CEO Zach Nelson the next morning, it certainly helped to fill me with confidence about its future.
Back in October 2011, Microsoft named the initiative to introduce Windows Azure cloud platform into the Chinese market “Moon Cake,” which represents harmony and happiness in Chinese culture. On May 23, 2013, Microsoft made the announcement in Shanghai that Windows Azure will be available in Chinese market starting on June 6 — almost half a year after its agreement with Shanghai government and 21ViaNet to operate Windows Azure together last November. Chinese customers will finally be able to “taste” this foreign moon cake.
I believe that a new chapter of cloud is going to be written by a new ecosystem in China market, and Microsoft will be the leader of this disruption. My reasons:
The cloud market in China will be more disrupted. Due to the regulatory limitations on data center and related telecom value-added services operations for foreign players, the cloud market for both infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) has been an easy battlefield for local players, such as Alibaba/HiChina. Microsoft’s innovative way working with both government and local service partners to break through this “great wall” shows all of the major global giants, such as Amazon.com, the great opportunity from this approach to the Chinese market. We can anticipate that they will also enter the Chinese market in the coming six to 18 months.