Webinar1 of 3 in a series: Best Practices to Help You Succeed in the Rapidly Changing SaaS Marketplace

Making the Most (Money) with Your SaaS Offering

Webinar Series

Webinar # 1

Best Practices to Help You Succeed in the Rapidly Changing SaaS Marketplace

Best Practices to Help You Succeed in the

Rapidly Changing SaaS Marketplace

Jeff Kaplan

Managing Director

THINKstrategies

2© 2011 Flexera Software, Inc. | Company Confidential

Bashyam Anant

Director, Product Management

Flexera Software

THINKstrategies Strategic Consulting Services

©2011, THINKstrategies [www.thinkstrategies.com]

Slide 3

How to Succeed and Thrive in the Rapidly Changing SaaS

Marketplace – Best Practices

Presented by,

Jeff Kaplan

Managing Director

THINKstrategies

[email protected]

781-431-2690

mailto:[email protected]

©2011, THINKstrategies, Inc. www.thinkstrategies.com

Slide 4

Today‟s Perfect StormDriving the „Cloud‟

Macro-MarketChallenges

EnablingTechnologies

ShiftingCustomer Attitudes


Slide 5

Deployment Challenges

• 31.1% SW projects cancelled before completed.

• 52.7% of projects cost nearly 190% of original estimates.

Operational Costs

• Maintenance & management costs >10x original license fee.

• Escalating hardware & staff support costs.

• Over provisioning/under-utilization of SW licenses.

Economic/Budgetary Pressures

• Need to reduce IT costs, increase business benefits.

• Need to increase utilization to gain greater ROI.

The Shortcomings of Legacy, On-Premise Apps


Slide 6

Consumerization, Shadow IT and the Mobile End-User


Slide 7

Changing Customer Needs/Expectations

Old,

Fixed, Capital Investment

Complexity, Customization

Centralized, On-Premise

Top-Down Procurement

High TCO, Low ROI

Internal Support

Outsourcing Alternatives

New,

Flexible, Operating Expense

Simplicity, Utilization

Mobile, On-Demand

Bottom-Up Adoption

Rapid Time-to-Value

3rd Party Services

Out-Tasking Options


Slide 8

SaaS Expands from Front- to Back- to Inter-Office Apps

BUSINESS APPLICATIONS

ERP

Finance

…

Front Office Inter-EnterpriseBack Office

Collaboration

CRM/SFA

…

Procurement

Supply-Chain

…


Slide 9

SaaS Expands from Business Apps to IT Management


Collaboration

CRM/SFA

…

Procurement

Supply-Chain

…

ERP

Finance

…


Security

Systems Mgmt

…

Network Mgmt

Remote Access

…

Data Protection

Storage

…

IT Management


Slide 10

SaaS Expands from Business Apps to Industry Solutions


Collaboration

CRM/SFA

…

Procurement

Supply-Chain

…

ERP

Finance

…


Financial Services

…

Retail

…

Manufacturing

…

Vertical Market/Industry-Specific Solutions


Slide 11

Shifting Adoption Patterns

Ad-hoc, Business End-

User/SBU Adoption;

IT Avoided.

Planned Enterprise-Wide,

Business-Driven Adoption;

IT Involved.


Slide 12

Recent Mega-Deals:SaaS/Cloud Policy Moves

= 500,000 suppliers

= 420,000 end-users

“We evaluated a number of alternatives, but Aravo SIM was the best commercially-available solution capable of meeting our complex, global needs” - SVP and CIO of GE

"The Enterprise Cloud Computing business model is a strategic direction for us. It not only lowers IT costs, and creates faster end to end processes, but

can also grow with our requirements both globally and locally.“

- Head of Corporate IT, Siemens AG


Slide 13

U.S. Government View

“I’m all about the cloud computing notion. I look at my lifestyle, and I want access to information wherever I am. I am killing

projects that don’t investigate SaaS first.”

President Obama’s CIO, Vivek Kundra, WSJ 3/9/09


Slide 14

Moving from SaaS Apps to Cloud Computing

Cloud Computing Services

SaaS Apps

“Top Strategic Technology for

2010”

But what does “cloud computing”

mean?

http://www.gartner.com/silentlocalechooser.jsp?locale=wcw


Slide 15

Public Private Hybrid Community

Deployment

Models

Service

ModelsSoftware as a

Service (SaaS)

Platform as a

Service (PaaS)

Infrastructure as

a Service (IaaS)

Essential

CharacteristicsOn-Demand

Self Service

Broad Network

AccessResource Pooling

Rapid ElasticityMeasured Service

Visual Model of NIST’s Cloud

Computing Working Definition

http://www.csrc.nist.gov/groups/SNS/cloud-computing/index.html

http://www.csrc.nist.gov/groups/SNS/cloud-computing/index.html

Evolution OfCustomer Concerns


Slide 16

Com

ple

xity

Time

Reliability

Security/Privacy

Interoperability/Integration

Governance/Compliance/Control

Innovation/Competitive Advantage

Support


Slide 17

Living in a Hybrid World

Companies prefer choice.

Businesses seeking combination of on-demand/on-premise solutions.

Variety of appliances and applets becoming available.

Cross-platform integration possible.

Cloud location-independencebecoming bi-directional.


Slide 18

A New Level of Valuein the SaaS/Cloud Market

Dynamic toolkit clearinghouse

Continuous updates, new ideas

Real-time, aggregated data

Meaningful benchmark studies

Practical best practices forums

User “Club” w/special privileges.


Slide 19

SaaS Can RedefineYour Business

SoftwareServices

BusinessServices

InformationServices

Vendor Evolution


Slide 20

SaaS, Cloud Computing &the IT Industry Inversion

Services Technologies

Past

Future

TheIndustryInversion


Slide 21

Biggest ISV Fears:The Four C‟s

Cannibalization

Corporate Disruption

Customer Confusion

Channel Conflict

More SaaS Economics


Slide 22

Monthly payments instead of up-front license fees increase the capital required.Source: SaaS Capital

Cumulative Cash Burn

-30,000,000

-20,000,000

-10,000,000

0

10,000,000

20,000,000

Year

1

Year

2

Year

3

Year

4

Year

5

Year

6

Year

7

Year

8

Year

9

SaaS Perpetual


Slide 23

Key Development/DeliveryLifecycle Requirements

User Centricity

Agile Development

Transaction Mgmt System

Security

Certifications

Service Orientation/

ServiceabilityProf.Svs./Consulting

Online Chat/Twitter

‘Try & Buy’ Trials

Virtual Support

Web/Search Marketing

Service Delivery Infrastructure

Ecosystem of Partners

Peer-to-Peer Forums

SLAs

Succeeding at SaaS


Slide 24

Create simple solutions.

Encourage customer input.

Develop frictionless processes.

Build monetization engine.

Target business inefficiencies.

Land & Expand


Slide 25

Summary:The State of the Market

v1.0 v2.0

• Focus on individual user

• Standalone point apps

• Horizontal applications

• Emphasis on ease of use/price/TCO

• One size fits all, limited customization

capabilities

• Limited interoperability

• Cloud only, single direction

• Proliferation of providers

• Emphasis on solution

• Best-of-Breed Win

• Focus on the enterprise

• Scalable, secure platforms

• Vertical/industry solutions

• Emphasis on added functionality/ROI

• Multiple configurations, greater

flexibility/versatility

• Greater integration capabilities

• Bi-direction location independence

• Industry shake-out & consolidation

• Emphasis on support

• Strategic Sources Win

Q & A


Making the Most (Money) with Your SaaS

Offering Webinar Series

Webinar #2:

How Pricing and Licensing Can Help You Monetize a SaaS Offering

Webinar #3:

Subscription and Entitlement Management Best Practices for Your SaaS Offerings


Best Practices to Help You Succeed in the

Rapidly Changing SaaS Marketplace

Jeff Kaplan

Managing Director

THINKstrategies

[email protected]


Bashyam Anant

Director, Product Management

Flexera Software

[email protected]

