THINK IT Services

I’ve published two commentaries recently in leading industry publications which describe how the next wave of Software-as-a-Service (SaaS) solutions will target ineffecient business processes.

The first was in Sandhill.com discussing how the line of demarcation between software, business and information services is blurring.

The second was in E-Commerce Times examining how Cloud services are going vertical to address industry-specific requirements.

I hope you find these perspectives helpful and worthwhile.

The year of the Cloud has come to a climax at Salesforce.com’s Dreamforce conference in San Francisco where over 30,000 registrants converged to celebrate the rapidly expanding world of ‘on-demand’ solutions and collaboration tools.

Salesforce.com used the event to beat back the recent efforts of Oracle and Microsoft to gain a share of the Cloud Computing market with a new round of initiatives aimed at building on its phenomenal momentum and success.

The two most significant announcements on Day One were Salesforce.com’s offer of free Chatter accounts across its customer base along with a public version of the social networking service in February, and a new Database.com offering as a spin out of its Force.com Platform-as-a-Service (PaaS).

Day Two began with the news that Salesforce.com plans to acquire the Open Source oriented, Ruby-based application development platform, Heroku, for $212 million in cash. Salesforce.com and BMC Software also announced that they are joining together to offer RemedyForce, a new Cloud-based IT service management and support offering built on Force.com. Salesforce.com also unveiled SiteForce, a new and improved version of its website design tool which was introduced previously.

Talking About Chatter

A year ago, Dreamforce attendees responded to the unveiling of Chatter with a lot of apprehension about why they should permit a Facebook-like social networking tool into their organizations. In response to this lukewarm reception, Salesforce.com put its marketing engine to work to overcome this hesitancy and has generated growing customer acceptance. 

Much of the opening session of Dreamforce was focused on the practical benefits of Chatter in corporate environments through a series of demos of use-cases and customer success story testimonials. Salesforce.com also emphasized how Chatter bridges the old and new worlds of the business user by linking to Microsoft Outlook and mobile devices.

Salesforce.com announced Chatter Free to extend its reach further into organizations beyond the sales and marketing departments. This initiative will permit Salesforce.com users to invite others within their organizations to utilize Chatter, in the same way Facebook users can invite friends to join their social networks.

With less fanfare, but possibly of greater significance, Salesforce.com plans to also roll out a public Chatter.com service in February aimed at popularizing Salesforce.com’s social networking capability in the open market. Both these moves will broaden Chatter’s footprint within organizations and brand equity in the marketplace. These moves will also make the folks at Facebook rethink whether they should have pursued the corporate market rather than relinquishing it to Salesforce.com. It will also get the attention of SuccessFactors which has been proclaiming that its Business Execution Software solution has a greater installed base of end-users than Salesforce.com.

Fortifying Force.com

Salesforce.com isn’t just seeking to permeate the enterprises via Chatter. It also wants to convince the developer world, both independent software vendors (ISVs) and internal enterprise developers, that Force.com is a credible PaaS for a new generation of enterprise-class, Cloud-based, mobile apps.

In its typical style, Salesforce.com unveiled Database.com as a new capability even though it is actually a part of Force.com which has been unbundled to create a new standalone offering and point of entry to Salesforce.com’s PaaS environment.

The standalone Database.com capabilities are being offered to respond to the changing way in which applications and databases are being architected in a more pluralistic fashion in the Cloud. The goal of Database.com is to democraticize database development, and give Salesforce.com’s customers and partners another reason to expand their use of its applications and PaaS. 

Salesforce.com has also been working hard to fend off competitive claims and developer concerns that its Force.com PaaS is too proprietary. It made a strong move in this direction with its alliance with VMware earlier this year, which produced VMforce.

Salesforce.com’s acquisition of Heroku reinforces this point, quickly giving Salesforce.com a strong foothold in the Open Source/Ruby application development environment, and immediate access to the rapidly growing Heroku developer community.

Heroku is considered by many to be the top Ruby platform in the Cloud market. The company has experienced 50% growth in application development activity in the past few weeks alone according to its Founder/CEO during his keynote presentation. Heroku will maintain its brand and become Salesforce.com’s seventh Cloud offering.

The Heroku acquisition and Database.com are geared to the new world of social, mobile apps. They are also intended to offset Microsoft’s aggressive efforts to gain customer and partner acceptance of its Azure PaaS, and undercut Oracle’s ‘false cloud’ offerings which it calls “Cloud-in-a-Box”. The Heroku acquisition is also a dramatic contrast to SAP’s purchase of Sybase, with Heroku representing the rapidly growing world of Cloud-based applications and Sybase viewed as an old-world development vendor attempting to recreate itself around mobile apps.

As Salesforce.com’s executives strongly stated during an industry analyst/press briefing, the message which the company is trying to convey to the market with this acquisition is that Force.com will be open and that Salesforce.com is going to be a platform company. A number of enterprise customers confirmed the importance of Salesforce.com’s PaaS efforts in their decisions to select the company as a strategic vendor.

SaaSifying IT Management

Salesforce.com’s announcement of RemedyForce in conjunction with BMC is significant for a number of reasons.

It is the company’s first attempt to provide a solution aimed specifically at the IT organization which is increasingly embracing SaaS-based alternatives to traditional IT management software. I’ve been telling clients and others about that the SaaSification of IT management and why this trend in the Cloud Computing market eliminates another barrier to greater customer adoption.

It is also the first time Salesforce.com has teamed with another company to launch one of its product-lines, or “Clouds”. This represents an important endorsement for BMC, as well as a risk for Salesforce.com. Teaming with an established ISV is an interesting choice for Salesforce.com. Like every established ISV which has attempted to add a SaaS component to its portfolio, it hasn’t been an easy road for BMC. But, the company has a highly committed CEO and has built a SaaS solution on Force.com which is gaining customer acceptance in the market.

This alliance puts Salesforce.com in the peculiar position of depending on a partner for the success of one of its product-lines. It also renews questions and concerns among its other partners about who gets preferential treatment within Salesforce.com’s ecosystem and why.

Closing Thoughts

One of the lingering complaints about Salesforce.com’s solutions is their premium price. Marc Benioff even joked about this point in his opening remarks at Dreamforce and got a hearty laugh from the audience. In an attempt to capitalize on this issue, Microsoft has launced a marketing campaign offering $200/user rebates  to Salesforce.com customers who jump ship in favor of Microsoft’s Dynamics CRM Online.  Benioff made light of Microsoft’s PR ploy by bringing the actor/model who is pictured in the Microsoft ads on stage during the Day Two morning keynote session and successfully convincing him to come back to Salesforce.com.

All joking aside, Salesforce.com’s premium prices hasn’t slowed its tremendous growth and hurt customer satisfaction/retention rates, or diminished the enthusiasm of the customers and partners attending Dreamforce this year.

The buzz and activity at Dreamforce 2010 is not only a clear indication of the Salesforce.com’s growing success, but also an impressive illustration of the widening movement to the Cloud.

[Disclosure: Salesforce.com paid for my hotel accommodations during my attendance at Dreamforce.]

Organizations of all sizes across nearly every industry are putting aside their legacy, on-premise applications in favor of a new generation of Web-based, on-demand, Software-as-a-Service (SaaS) and Cloud Computing alternatives.
 
This escalating trend is attracting a new breed of software providers and forcing established independent software vendors (ISVs), as well as in-house software developers, to re-think how they design, develop and deliver business applications.
 
THINKstrategies has published a whitepaper, on behalf of SoftServe, which examines how Cloud-based, SaaS applications differ from traditional on-premise software products, and how specialized software development firms can help ISVs and in-house developers meet users’ changing expectations and achieve their business objectives.
 
Click here to obtain a copy of THINKstrategies’ whitepaper. I hope you find it helpful.

Despite the growing examples of organizations gaining tangible and measurable business benefits from Cloud-based, Software-as-a-Service (SaaS) solutions which THINKstrategies profiled in its recent report entitled, “Measuring the Business Benefits of Today’s Software-as-a-Service (SaaS) Solutions”, many corporate decision-makers remain apprehensive about adopting these Cloud-based services because of data privacy and security concerns.

Companies outside the U.S. are particularly concerned about using services delivered by U.S.-based providers because of the ominous language contained in the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act, commonly referred to as the U.S.A. Patriot Act.

This regulation appears to permit U.S. law enforcement agencies to unilaterally access private customer records stored on corporate servers worldwide if they are suspected of holding data which could pertain to terrorist threats or other criminal activity. These fears have made organizations especially hesitant to consider SaaS-based Customer Relationship Management (CRM) software and services offered by U.S.-based SaaS vendors.

THINKstrategies believes these risks have been overly exaggerated and raise unfair questions about doing business with U.S.-based companies. Ironically, we believe companies who avoid contracting with leading U.S. SaaS providers may be at greater risk of data privacy breaches by continuing to rely on traditional, on-premise software applications and locally hosted servers.

We have published a whitepaper which examines the myths and realities of SaaS/Cloud Computing, the U.S.A. Patriot Act, and data privacy, with a focus on the CRM arena.

Click here to download a copy of this whitepaper. I hope you find it useful and worthwhile.

THINKstrategies announced today that SAP BusinessObjects Business Intelligence (BI) OnDemand solution has been named the latest winner of the Best of SaaS Showplace (BoSS) Awards program, which is aimed at promoting the measurable business benefits being delivered by today’s Software-as-a-Service (SaaS) solutions.

The BoSS Awards is an ongoing program which recognizes SaaS companies that are producing tangible business benefits for specific user organizations. These benefits can include increased sales, lower costs, higher customer satisfaction, faster operations and greater profitability.

SAP BusinessObjects BI OnDemand is an intuitive, turnkey business intelligence solution that allows business people with no prior experience to explore, report and share information inside or outside the company.  Because it’s on demand, SAP BusinessObjects BI OnDemand can be acquired and setup in minutes, without a long technology project.  It’s available standalone or can integrate with existing on-premise or on-demand investments, delivering improved productivity and greater insight for more informed decision-making.

Click here to read about the measurable business benefits which earned SAP BusinessObjects BI OnDemand the latest BoSS Award winner.

Click here to learn more about the BoSS Award program and to apply for an Award.

Based on the success of the BoSS Awards program which focuses on SaaS solutions, THINKstrategies has launched the Cloud Computing Business Value (CCBV) Awards program to recognize companies which are delivering Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) solutions producing measurable business benefits for their customers. For more information regarding the CCBV Awards, go to http://www.thinkstrategies.com/cloudcomputingawards.html.

At its core, the fundamental value proposition of Software-as-a-Service (SaaS) is risk management because it promises to enable companies to better manage resources, focus on core capabilities and minimize the cost of extensive IT infrastructures.

But anecdotal evidence suggests that many potential buyers believe SaaS entails other forms of risk – and that this belief often stalls purchase decisions, especially among C-suite executives.

Grant Thornton is eager to test, measure, clarify and perhaps erase perceptions that challenge greater business adoption of SaaS solutions by conducting an industry survey to see how these risks are impacting SaaS success.

THINKstrategies is pleased to be supporting Grant Thornton’s SaaS Business Sector Risk Management Survey, and would like to encourage SaaS, other independent software vendors (ISVs) and as well as those who are involved with the delivery of SaaS solutions to participate in this research project.

Grant Thornton’s goal is to generate and distribute meaningful survey findings which will be useful to both SaaS providers, as well as current and prospective customers, including business executives at the highest levels of their companies.

Click here to participate in the survey and Grant Thornton promises,

• The survey takes no more than 10-15 minutes to complete.
• Participants will be among the first to receive quantitative intelligence on the perceived risks of SaaS services.
• Participants will also receive additional qualitative and strategic analysis from SaaS specialists working with Grant Thornton. 

If you are interested in participating in this research project, please complete the survey by Wednesday, November 24. 

Contact Ralph Nefdt, Grant Thornton’s National Software Sector leader, at Ralph.Nefdt@gt.com or 415.365.5452, if you have questions regarding the survey.

You can also contact us at info@thinkstrategies.com, if you’d like to explore ways your company can leverage THINKstrategies’ services to conduct similar research or to achieve your business objectives.

Yesterday’s announcement that Ray Ozzie is retiring from Microsoft is newsworthy because he has been at the heart of the company’s efforts to keep pace with the rapidly evolving Software-as-a-Service (SaaS) and broader Cloud Computing movement.

Ozzie joined Microsoft when his company, Groove Networks, was acquired in 2005. Groove was an independent software vendor (ISV) trying to commercialize the groupware ideas which Ozzie had pioneered with Lotus Notes.

Around the same time as the acquisition, Bill Gates warned Microsoft’s employees of the far-reaching implications of the coming “Internet Tidal Wave” in an infamous internal memo which quickly became public and stated,

“This coming ’services wave’ will be very disruptive…Services designed to scale to tens or hundreds of millions will dramatically change the nature and cost of solutions deliverable to enterprises or small businesses.”

Ozzie issued his own memo warning about the “The Internet Services Disruption” shortly after he arrived at Microsoft in October, 2005, in which he stated,

“Computing and communications technologies have dramatically and progressively improved to enable the viability of a services-based model.”

Although Microsoft never fully implemented a set of collaborative solutions like Lotus Notes beyond its Sharepoint and Exchange capabilities, Ozzie was named one of the company’s three CTOs and eventually became Chief Software Architect after Gates retired from his day-to-day responsibilities. In this role, Ozzie assumed responsibility for leading Microsoft into the SaaS/Cloud world.

Over the past year, Microsoft has replaced its self-serving “Software Plus Service” mantra with a new “All-In” attitude about SaaS and the Cloud Computing, and rolled out its own Platform-as-a-Service (PaaS), called Azure. After being the brunt of industry jokes, it is beginning to regain its momentum in the software industry as a result of these moves.

So, why is Ray Ozzie leaving now that his vision is beginning to become a reality?

Since Ballmer and Ozzie aren’t offering a clear explanation, we can only speculate that Microsoft is still has a long way to go to achieving Ozzie’s vision and he doesn’t have enough energy to see it through. Or, the company isn’t really on the path to success and Ozzie is tired of trying to push it in the right direction.

Of course, it could also be a case of Ozzie simply looking to enjoy more time with his family, or recognizing that it is time for someone else to take the helm of Microsoft’s SaaS/Cloud efforts. But, these intentions and the name(s) of a successor are usually included in an announcement of this nature. This wasn’t the case in yesterday’s announcement.

Either way, it will be interesting to see where Microsoft goes from here and if its SaaS/Cloud Computing efforts are derailed by Ozzie’s departure.

THINKstrategies announced today that Accept Corporation has been named the latest winner of the Best of SaaS Showplace (BoSS) Awards program, which is aimed at promoting the measurable business benefits being delivered by today’s Software-as-a-Service (SaaS) solutions.

The BoSS Awards is an ongoing program which recognizes SaaS companies that are producing tangible business benefits for specific user organizations. These benefits can include increased sales, lower costs, higher customer satisfaction, faster operations and greater profitability.

Accept Corporation’s SaaS-based Accept 360 Innovation Management solution empowers product teams to more quickly develop compelling products that generate greater revenues, because they’re better aligned with the market and company strategy.

Click here to read more about the measurable business benefits which earned Accept Corporation the latest BoSS Award.

Click here to learn more about the BoSS Award program or to apply for an Award.

Based on the success of the BoSS Awards program which focuses on SaaS solutions, THINKstrategies has launched the Cloud Computing Business Value (CCBV) Awards program to recognize companies which are delivering Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) solutions producing measurable business benefits for their customers. For more information regarding the CCBV Awards, go to http://www.thinkstrategies.com/cloudcomputingawards.html.

Many people believe there is only one way to sell Software-as-a-Service (SaaS) solutions — via free, online trials and outbound tele-marketing tactics. Read my latest E-Commerce Times commentary to see how some SaaS companies are dispelling this myth and demonstrating how SaaS solutions can be sold in various ways. Click here to read more.

In addition to posting my views and latest THINKstrategies’ news on this blog, I’ve also become a regular contributor to the UBM TechWeb online macrosite called Internet Evolution.

In recent weeks I’ve examined the following topics,

• When Cloud Terminology Backfires 
• Purpose-Built Social Networks Make Corporate Inroads 
• Cloud Providers Hope Dashboards Build Trust 
• Telcos Invade Cloud Services 
• A New Take on Cloud Standardization

Click here to find all of my Internet Evolution commentaries and comments. I hope you find them interesting.  If so, you can set up an RSS feed to follow these commentaries or follow my latest Twitter updates @thinkstrategies.