Friday, April 24, 2009

The Future as-a-Service

I'm sure we all have heard of SaaS or Software-as-a-service, which is a pathbreaking concept introducing a way of 'serving' software which traditionally was always a physical and locally installed entity. I would say it all started few decades back when 'outsourcing' got coined as a futuristic concept to bring efficiency to business operations. It was an inevitable move to optimize costs by moving operations to lower cost locations. This concept, initially limited within a country or region, got expanded across countries and geos as economies became global .. and we all know that it's such an integral part of doing business now that it's here to stay. (unless the human brain finds another brilliant cost optimization idea, while avoiding some of the possible issues outsourcing poses)

But why these jargons, concepts, theories keep on getting coined every now and then, are these mere buzzwords? I don't think so; I think it’s a necessity, apart from being a reflection of human nature. Being part of a professional organization all of us know that the only way to move, for a professional org like ours, is to move ahead. The sales, revenue, delivery efficiency targets every year have to be more aggressive for any organization worth its salt that wants to be a front runner. Now, the question is 'HOW' you can get more and more efficient with almost similar resources you had earlier. 'HOW' do we cut corners and be on the lookout for finding possible redundancy in the seemingly 'frills-detached' way that we work. The answer I think lies in 'Innovation'. And all these concepts are brainchild of some very innovative people, and packaged well too! by some marketing gurus.

I was listening to Eric Schmidt (Chairman & CEO, Google) on YouTube in a press conference, and he was asked - "We all know about Web 2.0, What would be Web 3.0"; and he said on a lighter note - "Web 2.0 is a Marketing term, and I think you've just invented Web 3.0". So, there definitely is a Marketing air about these jargons but one cannot rule out the important impact they bring to the way businesses are run, by their underlying design and meaning.

On the Human nature aspect - I'm sure we all sometimes feel that how easy work life was a few years back and if we had a time machine we all can go back a few years in our lives, have much less work pressure and better work-life balance. Those years and those targets seem like a cakewalk now. But the irony is that when we were physically living that year, the situation was very much the same, meaning, the years past that, used to look easier and simpler then!

So, I think it’s in the human nature to challenge its limits and move ahead, put tougher targets and try to constantly beat them, the basic reason why we are where we are, from the prehistoric Stone Age days. This inherent nature is what differentiates us human from animals and other forms of life.

I think 'SaaS' takes the same urge to bring in efficiency, innovate and move ahead further, bundled with a proven concept of ‘outsourcing’, and applies it to a different area. Only that this time, not operations but software installation, hosting, maintenance, upgrade and associated pain areas are being 'outsourced'. A brilliant way of applying the same outsourcing concept indeed!

Proliferation of the internet is a major contributor in promotion of this concept, where it is becoming increasingly valid to assume that all professionals are connected or can connect to the internet most of their working hours. So, exploiting Internet as its vehicle, some brilliant brains applied the service concept to Software and transformed ‘Software-as-a-Product’ to ‘Software-as-a-Service’.

From a budding concept almost a decade back, when became flag bearer for this model promoting "No-Software", it has matured in a massive way where customers are now considering Enterprise SaaS offering a must-have in their IT portfolio, primarily with an aim to reduce TCO and realize ROI faster. And in my own experience we have companies of all sizes - from large Manufacturing or Retail companies, to Airlines or Hi-tech companies, Telcos and even Banks & FIs keen on evaluating and/or migrating to this model.

Despite the slumping worldwide economy, the adoption of SaaS is growing and evolving in the enterprise markets. To cash in, many vendors are rechristening their offerings as SaaS, but as Gartner notes, it is important to keep in mind that the true SaaS/on-demand is comprised of the following:

* Delivery of multi-tenant service
* From a remote location
* Over an internet protocol (IP) network
* Via a subscription-based outsourcing contract

Garther further predicts SaaS revenue reaching US$ 14.8 billion in 2012, with SaaS within the office suites reaching 99.2% compound annual growth rate from 2007 through 2012. just proved that plausible, by crossing $1bn in revenue last fiscal, becoming the first Enterprise SaaS company to do so.

Indian IT powerhouse Wipro too has recently shared its plan and intent to enter the Cloud computing market [Wipro To Enter Cloud Computing]

So, with a positive backup of prediction-gurus, proven past performance, acceptance increasing by the day, innovation happening across areas to apply the 'Services' tag and concept; I would just say - let’s brace ourselves for the future - for it will be the Future-as-a-Service.

1 comment:

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