Wednesday, July 24, 2024
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SaaS - Acceptance is the Last Stage of Grief

When something long standing and codependent dies, like traditional computing, SaaS and cloud computing are going to be our best friends at the wake.  SaaS solutions have been around for going on 10 years now and the time is right to see broader and deeper adoption of this approach to application development and utilization. Lower risk processes like sales, marketing and HR have provided the first set of users to benefit from shorter implementation times, easier to use applications and functionality that is perpetually kept up to date. Now that enterprises are faced with doing even more with even less, SaaS should be considered as a replacement more mission-critical internal business processes as well as customer facing applications. By all means grieve, but know that SaaS has been waiting patiently for you since the day you first met. She’s grown as platform and so have your needs.

The traditional technology adoption cycle has just received a jarring inflection point kick in the pants. Typically new technologies move through a predictable path from early adopters to market laggards the same way almost every other commodity introduced into the marketplace. It is a challenging cycle that many technologies fail to overcome (does anyone remember bubble memory and hand-held scanners?) but fairly predictable none the less. According to Geoffrey Moore in his book, Crossing the Chasm, each stage along the way requires certain strategies and tactics that increase the likelihood of success.

Assessing the Grieving Process

The last few months have dramatically changed the landscape globally and everyone will be looking at everything they do from a different perspective. We are just now getting out of the denial phase of dealing with this crisis and heading smack into anger over how this all happened and happened so quickly. If this path is continued, bargaining will ensue and that means evaluating what can be done differently to survive in the new economic reality. From an organizational perspective that means looking at every cost associated with everything to see if it can be done away with or done more cheaply in another way (saas starts looking better for a broader role in the business.)

Without this shock to the system the status quo would have been maintained because there would not have been a compelling reason to change what was already in place. Companies do not experience depression, the next phase of coping with a tragic event, even though the people that make up an organization can and often do experience it quite profoundly.

So that leaves acceptance of the fact that a bad thing has happened and the only choice is to adapt or die. Since death of an organization means serious economic disruption to all concerned, adapting to leaner and flexible processes is the only viable choice. These types of changes are always talked about in an organization but ultimately there is little motivation to go through painful change when everyone feels like the ship is generally going in the right direction.

While SaaS and cloud computing are not a panacea, it does offer organizations the ability to get in, get up and get running more quickly and cost-effectively than traditional software applications. While the TCO debate continues over whether saas is cheaper with larger user populations over a long period of time, there is one major component that is overlooked when calculating the benefits of saas. Continuous upgrading of a SaaS platform means a company never has to go through an upgrade or deal with the incompatibilities so-called suite product offerings.

The reality of SAP and Oracle’s products is they are a mixture of legacy code bases from the companies they purchased over the years. So adding a configurator to your CRM system means a whole new implementation with business disruption and resource drain to do the implementation. Further, if the configurator gets an upgrade there is no guarantee that it will work with your existing versions of opportunity management and demand planning. This is why so many companies are running customer support systems that are 2 years past the last upgrade and in numerous cases outside standard support from the vendor. It’s also why SOA has become a mantra in many IT circles.

The Time to Move On

Today everything must be reevaluated with more and more organizations looking at their legacy systems and transitioning them to the cloud. They will be able to do it more quickly with less money and maintain the applications with fewer people. In addition they will be able to react more quickly to changing market requirements and even globalize operations to take advantage of lower labor costs or access to new market opportunities. It is time to realize that building a SAS 70 II compliant data center is better left to those who do that sort of thing for a living. Likewise, it is time to acknowledge that the lower levels of the software stack have commoditized to a point where there should be little or no need for a staff of database architects and programmers, no matter where their located, hammering endlessly at an attempt to hone the perfect application to keep the business running. Situational, composite applications that adhere to enterprise conditions and dynamics and are turned around in days rather than months are the new new things.

2009 will be a watershed year for SaaS because the cost of maintaining the status quo is no longer sustainable in the face of seismic economic changes. The organizations that will survive, or even thrive, going forward are the ones whose systems don’t prevent them from making the necessary changes to their business model or operating practices. All the talk of building an agile enterprise will be put to the test this year and cloud offerings will be one of the key enabling technologies that will increase the likelihood of success.

There is life after traditional legacy applications in the enterprise and it’s time for both you and SaaS to go forward together into this new life.

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