SaaS – Challenges and Success Factors
Rajesh Ranjan
CONFIDENTIAL: For limited circulation only © 2009 MindTree Limited
© 2009 MindTree Li

Agenda
Business Challenges
Operational Challenges
Technical Challenges
SaaS Myths
Critical Success Factors
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SaaS - Business Challenges
 Revenue Model – Volume or Value
 Payments – yearly or monthly
 Customer stickiness – Why does customer leave?
 Customer Loyalty – How long does customer stay?
 Market – Local or diverse geography?
 Do we know what people need and why?
 Do we portray reliability as a company?
 Business Model on SaaS – Does it exist in the company?
 Sufficient funding - In SaaS model, the breakeven point can be
painful
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SaaS - Operational Challenge
 Does solution adapt business or is business adapting solution?
 Do we understand the user behavior and what most of user is using?
 Do we have proactive alerts to help meet 99.999% uptime SLA?
 We host in data center and they provide statistics. Is it enough to
take a business decision?
 Do we have customer on-boarding process?
 Did we analyze the data on performance on our own with the
increasing subscription on the application?
 Are we compliant and make is visible to use to ward-off any
security concerns?
 What is the level of the customer service?
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SaaS – Technical Challenges
 Scalability – With large subscription base, does the application
scale?
 Security – Does design handle security religiously?
 Change the tyre while car is running – Do we have people who can
do this?
 Internal Architecture – Solution needs to be architected with SaaS
philosophy
 Business Model in design – Is system designed to handle the business
growth?
 Integration – Sooner or later, the application will need to integrate
with 3rd party solution, on-premise or hosted. Is it designed for it?
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SaaS Myths
 SaaS is always cheaper – May be true in short duration but for
longer duration (3-5 years), it may not be.
 SaaS is less secure and reliable – Outages and security breaches are
common in enterprise software as well. SaaS applications are
designed to handle this with difference degree of compliance.
 SaaS is utility model – May be true for a B2C application but for B2B
solution, there are other costs involved.
 Very difficult to integrate with SaaS – as with any application, once
the initial data load is done, SOA allows data to be synchronized.
 SaaS can not handle complex requirement – Maybe true to some
extent but looking of the way solutions are being integrated and
offered, this is no longer an issue.
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SaaS Myths
 SaaS applications are lightweight – Just because it is simple to
deploy and maintain than on-premise software, it does not mean
that it can be classified as lightweight or cut down version.
 SaaS will replace ERP – Ex- SAP vs NetSuite; ERP is a value
proposition which cannot be not possibly met by SaaS and they
need to co-exist.
 SaaS is for only SMB – Increasing adoption by large enterprise has
proved it otherwise.
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Critical Success Factors
 Customer Satisfaction – Satisfied customer tend to stick longer
 Selecting target segment – Helps in positioning and lead generation
 Generating and addressing the need – Helps in Demand generation
 High level of collaboration – Expectation, Fulfillment, ownership
re-defined
 Competency Building – include Sales, Marketing along with
technical people in how to manage SaaS business
 Professional Services – Every enterprise customer has a different
reporting need, on-premise software etc. Professional Service team
needs to be mature and work on Factory model on-demand to meet
the goal.
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Successful Customers
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Rajesh Ranjan
rajesh_ranjan@mindtree.com
+91-80-40308005
www.mindtree.com
CONFIDENTIAL: For limited circulation only © 2009 MindTree Limited
© 2009 MindTree Li