SaaS is turning computing into a utility like the electric grid did for industry.

SaaS is a significant growth driver but fuzzy informations spread over the web make it difficult to understand and differenciate from software hosting environments.

This blog focuses on key success factors driving the development of a successful Business-As-A-Service solution.

Monday, November 2, 2009

Strategic investments in Cloud solutions should not be a technologically driven approach

By reading that Gartner is citing Cloud Computing as the Number 1 technology area that should drive strategic investments I both agree and rise a warning flag.

I agree that this is where a company should aim at driving its strategy, Cloud Computing Adoption Jumps 320% This Year Alone, also relayed in Top 5 things about this years gartner symposium.

I disagree that this should be foreseen as a 'technological area'. Of course there are architecture design, security assessments, delivery capabilities that relies on technological bricks. But a company willing to successfully drive its business on using cloud based and Software-As-A-Service solutions should first think about it as a strategic and business area.

Technology is mature enough to let you build the solution you need.
The first step is thus to be sure about what your 'needs' are.

You start seeing communications about private versus off-the-shelf cloud architectures. This communication is driven by technology-focused providers.

Read back my first blog entries about the key success factors you have to focus on.
  • You should see this as a challenge on finding what is the set of services that will differenciate your company from your competitors and allow you to generate growing recurring marging revenues;
  • You should focus on micro-marketing this set of services;
  • You should think about industrializing the provisioning of these services;
  • You should aim at satisfying the SLA which you defined on each service;
  • You should behave as a 'services operator', looking at Average Margin Per User and Churn rates;
  • You should enventually rethink your channel management strategy.
Then and only then you may and should start thinking about technology. And if you are really business oriented and want to shorten your go-to-market with efficient margins you will enventually find that off-the-shelf SaaS pure players will offer you both the set of solutions you need and the capability of assembling these cloud services in the way you designed it !

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