-
7/31/2019 Cloud Trends - 2015
1/6
The Cloud and Business Service
Key Trends and Directions Through 201
A research report prepared
Executive Summar
-
7/31/2019 Cloud Trends - 2015
2/6
The Cloud and Business Services:
Key Trends and Directions Through 2015
July 6, 2011
TABLE OF CONTENTS
2011 Saugatuck Technology Inc. i
About Saugatuck Technology
Saugatuck Technology Inc. provides subscription research /
advisory and strategy con-
sulting services to senior business and IT executives,
technology and software vendors,business / IT services providers,
and investors. Our mission is to help our clients make
better business decisions and create new business value through
trusted and objective
insights into the key market trends and emerging technologies
driving real change inbusiness computing. Over the last few years
this has included a major focus on Soft-
ware-as-a-Service (SaaS), Cloud Infrastructure, and Social
Media, Mobility and Ad-
vanced Analytics among other key trends. Founded in 1999,
Saugatuck is headquar-tered in Westport, CT with offices in
Falmouth, MA and Santa Clara, CA and Frank-
furt, Germany. For more information, please
visitwww.saugatucktechnology.com, or
call +1.203.454.3900.
About this Report
This Cloud Business Services report takes a broad view
concerning how the Services / Out-
sourcing market will evolve in response to the emergence and
growth ofCloud ITand
Cloud Business strategies. It provides a forward-looking view
toward 2015 into how tradi-
tional services providers are reshaping their business models
and service delivery, and how
they will add value across the entire Cloud EcoStackTM
including the emergence ofBPaaS and BPUs. The Cloud is also
helping non-traditional service providers emerge withunique
horizontal and industry-specific value propositions highly tuned to
specific buying
centers. In the context of the past eight years of Saugatuck
research into the Cloud, thesetrends illustrate not only where the
Cloud is heading, but also where its been. Additional
related research of interest is available to clients via our
Research Library located at
www.saugatucktechnology.com/browse-research/ (registration
required).
The following Saugatuck staff were instrumental in the
development and publication of this
report:Lead author: Robert McNeill, support by Bill McNee, with
contributions from othermembers of the Saugatuck Team including
Bruce Guptill, Mike West and Charlie Burns.
Summary 1
Introduction 2
From Anyshore to Anywhere: A Market in Evolution 4
Transitioning the Pillars of Services Delivery to the Cloud 5The
Emergence of Cloud IT and Cloud Business Services 8
Cloud IT Offerings 9
Cloud Business Offerings 10
Cloud Service Providers: Movers and Shakers 13
User Impact 16
Vendor Impact 17Figure 1: Services Delivery Management Evolution
3
Figure 2: Traditional versus Cloud-enabled Services /
Outsourcing 6
Figure 3: The Saugatuck Cloud EcoStack 9
Figure 4: Business Process Utility Characteristics 12
Figure 5: Cloud Services Providers: Movers and Shakers 14
TABLE OF FIGURES
http://www.saugatucktechnology.com/http://www.saugatucktechnology.com/http://saugatucktechnology.com/Browse-Research/http://saugatucktechnology.com/Browse-Research/http://www.saugatucktechnology.com/
-
7/31/2019 Cloud Trends - 2015
3/6
The Cloud and Business Services:
Key Trends and Directions Through 2015
July 6, 2011
SUMMARY
The IT and BPO services market is undergoing a period of deep
structural change
that is challenging the finely tuned market positions and
business models of tradi-
tional services providers. Critical business change is occurring
across supply
chains, vendor / provider relationships, and customer
relationships, due in part to
the adoption ofCloud ITand Cloud Business models, but also the
product of glob-
alization and new sourcing innovations such as
Business-Process-as-a-Service
(BPaaS), Business Process Utilities (BPU) and Crowdsourcing.
While we are seeing the traditional systems integration services
market decline in
terms of overall market opportunity, in its place new services
and channel opportu-
nities are being born as a result of the Cloud. Cloud services
providers will flourish
as they embrace Cloud IT and Cloud Business, serving both ISVs
migrating to the
Cloud and enterprises reshaping themselves.
New Cloud Business services from non-traditional technology
services providers
(such as Volly from Pitney Bowes, or the ActiveHealth
ManagementCollaborative
Care Solutionpartnership with IBM) are driving innovation within
the services
provider market, increasing competition and providing user
organizations with
more choice.
Traditional vendors and business models willexperience a period
of major transi-tion and upheaval. The major established services
players need to translate their IP
into repeatable solutions. This will take serious investment
which will be a sig-
nificant challenge for many services providers, especially those
who have grown
on the backs of a labor arbitrage model. Offshore vendors in
particular will be chal-
lenged as they do not have a culture of investment in repeatable
solutions and this
will have to change quickly. Creating solutions takes a greater
understanding of
client issues and will require more onsite visits. This will
negatively affect the off-
shore providers as visa constraints tighten. For organizations
reviewing the sourc-
ing market, more complexity exists across the management
disciplines of provider /
offering assessments, selection, acquisition, transition and
management.
2011 Saugatuck Technology Inc. 1
http://www.volly.com/http://www.activehealthmanagement.com/http://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www-03.ibm.com/press/us/en/pressrelease/32267.wsshttp://www.activehealthmanagement.com/http://www.volly.com/
-
7/31/2019 Cloud Trends - 2015
4/6
-
7/31/2019 Cloud Trends - 2015
5/6
The Cloud and Business Services:
Key Trends and Directions Through 2015
July 6, 2011
Figure 1: Service Delivery Management Evolution
2011 Saugatuck Technology Inc. 3
Phase Advantages Disadvantages
Late 90s
Domestic(On-premises)Outsourcing
Improve return-on-assets (ROA).
Financial predictability through longterm relationship Access to
scarce technology resources
in a time of technology boom
Lacks significant cost advantage overstatus quo over long
term
Severance required for existing workers Significant transition
and management
costs including development of newskills for managing service
providers
Early 00sOffshoring
Significant labor cost advantageduring technology recession
/dot.com bust for staff augmentationand modernizing legacy
applications
Provides a pool of available technologytalent especially for US
firms(English language)
Round the clock development due totime differences
Increasing transition and managementcosts
Restriction on nature/type of jobs: lan-guage and cultural
challenges
Commercial, geopolitical, social andsecurity risks and
instability
Time zone reduces ability to communi-cate real time
Entry of multinationals developing cap-tive centers (increasing
competition forresources)
Mid 00sNearshoring
Diversification away from India to tapinto new markets for
talent (BrazilEastern EU, Canada)
Smaller time-zone difference (US > Mex-ico, Costa Rica,
Brazil)
Better language / cultural support fornon-English speaking
countries(France > North Africa)
Telecommunications infrastructure im-maturity and lack of
competition
Insufficient scalability in somegeographies to create and win
fromeconomies of scale
Some nearshore centers not as maturefrom a process, quality or
experienceperspective
Late 00sHomeshoring
Higher unemployment can yield
broad talent supply Improved access to talent not
suitable for offshore work (e.g.,editorial services for bank
reportwriting, call centers)
Teleworking reduces infrastructurecosts (real estate and
operating)
Loss of management control for or-ganizations that manage
through
observation rather than output Higher perceived security
risks
(identity management) Worker isolation from not being in the
office and having access to manage-ment and other employees
Lack of onsite support
Early 10sCloud IT andCloud Business
Everything as a Service oftendelivered from anywhere
Consumerized IT that is easy to use Subscription based billing
Improved agility and lower cost of
entry to enterprise services Increased focus around vertical
market niches
Organizations lack benchmarking re:commercial risk for both
parties inconstruction of contracts
Higher security risks due to loss ofpersonal data
Immature SLAs Market and provider immaturities Ability for
business to bypass IT
2015 onwardsCrowdsourcing
Sourcing from Anywhere an opencall for talent
Lower cost, multiple option, possibilitiesfor more
innovation
Security Immaturity of offerings Current fringe use is used only
at the
fringe (e.g. logo design, graphics,prototyping)
Source: Saugatuck Technology Inc.
-
7/31/2019 Cloud Trends - 2015
6/6
17 2008 Saugatuck Technology Inc.
SAUGATUCK OFFERINGS AND SERVICES
Saugatuck Technology provides subscription research /
advisory and consulting services to senior business and
IT executives, technology and software vendors, business /IT
services providers, and investors.
Our Mission is to help our clients make better businessdecisions
and create new business value through trusted
and objective insights into the key market trends and
emerging technologies driving real change.
Over the last few years, this has included a major focus
onSoftware-as-a-Service (SaaS), Cloud Infrastructure, and
Social Computing, among other key trends.
CONTINUOUS RESEARCH SERVICES (CRS)
Subscription research / advisory services that provide
independent / unbiased analysis, insights and guidanceinto the
most important emerging technologies driving
change in business computing.
We are experts in Cloud Business and Cloud IT,
among other key market trends / technologies - with abalanced
view that is valued by both providers and
consumers of technology-enabled products / services.
USER STRATEGIC CONSULTING SERVICES
Leadership and Planning Workshops
Strategy and Program Assessments
Vendor Selection / Evaluations
Cloud Transition / Migration and Mgmt Best Practices
VENDOR STRATEGIC CONSULTING SERVICES
Market Assessment
Strategy Validation
Opportunity Analysis
Positioning / Messaging / Go-to-Market Strategies
Competitive Analysis
THOUGHT-LEADERSHIP PROGRAMS
Custom research programs targeting key technology
and business/IT investment decisions of CIOs, CFOs
and senior business executives, delivered as research
reports, position papers or executive presentations.
VALUE-ADDED SERVICES
Competitive and market intelligence
Investment advisory services (M&A support,
due diligence)
Primary and Secondary market research.
To learn more about Saugatuck consulting and research
offerings, go to www.saugatucktechnology.com or
email Chris MacGregor. While there register for
ourcomplimentaryResearch Alerts, which are published on
a weekly basis, or visit ourLens360 blog.Silicon Valley:
Santa Clara, CA
+1.408.727.9700
Germany:
Eltville, DE
+49.6123.630285
US Headquarters:
Westport, CT 06880
+1.203.454.3900
SAUGATUCK LOCATIONS:
http://www.saugatucktechnology.com/mailto:[email protected]://www.saugatucktechnology.com/http://www.saugatucktechnology.com/http://saugatucktechnology.com/Lens360http://saugatucktechnology.com/Lens360http://www.saugatucktechnology.com/mailto:[email protected]://www.saugatucktechnology.com/
