0
Business
Implication of SaaS
  Multi-Tenancy
      July 16 2009
Agenda
       Speaker Introductions
                »     Mike Dunham
                »     Lincoln Ventures
            ...
Speakers
     Mike Dunham –
             » Principal Consultant at Scio Consulting
             » mdunham@sciodev.com
   ...
Q&A

       Your input and feedback makes this a
        much better forum!




4   Scio Consulting International, LLC. A...
What is Software as
 a Service (SaaS)?

       July 2009
What is Software-as-a-Service?
       Software as a Service (SaaS) is a model of software
        delivery that allows ap...
SaaS Evolution




3   Scio Consulting International, LLC. All rights reserved.
Business View – Traditional Model




4   Scio Consulting International, LLC. All rights reserved.
Business View – SaaS Model




5   Scio Consulting International, LLC. All rights reserved.
SaaS vs ASP

       ASP: Application Service Provider
                » Single-tenant architecture (one customer
        ...
Multi-Tenancy

       Naïve
                » Single Database & Code Structure – Serving Multiple
                  Custo...
Existing Product - Levels of “SaaSification”

                           “SaaSification” Levels
          Characteristic  ...
Key Technical Aspects of SaaS


           Multi-tenancy           Integration
           Scalability             Secu...
SaaS Application Stack




10   Scio Consulting International, LLC. All rights reserved.
Multi-Tenancy in SaaS:
 The Business Case
Presented July 16, 2009 via Webinar
Hosted by Scio (http://sciodev.com)
Introduction
        Lincoln Murphy, Founder & Managing Director
                     Sixteen Ventures
                  1...
What SaaS Is Not

            Pricing Model                                           Revenue Model


          Anything o...
What SaaS Is

               Business                                                   Intellectual
              Archite...
What SaaS Is

          Functionality                                               Commercially
        delivered via web...
Decision Time:
          Are you a SaaS Vendor or not?

           Hybrid is hard;                                        ...
Remember!
                    The further you stray from this
                clear definition of SaaS, the harder
       ...
Multi-Tenancy
                        Considerations

                Application                                         ...
Multi-Tenancy
                         Infrastructure
            Economies of                                            ...
Multi-Tenancy
                          Application
                                                                      ...
Multi-Tenancy
                             Data Layer
          Aggregate Data                                            ...
Multi-Tenancy
             Data Layer Implementation
                                                                     ...
Remember!
                    The further you stray from this
                clear definition of SaaS, the harder
       ...
ASP Model

           Multi-Instance,                                          Non Web-native
           Single-Tenant    ...
SaaS Business
         Architecture
         Consultants


lincoln@sixteenventures.com
http://sixteenventures.com

http://...
This Changes Everything

       Rick Chapman
     www.softletter.com
rickchapman@softletter.com
   At our SaaS University conference in Atlanta,
    Patrick Fetterman, head of marketing of Plexus,
    now Plex, said t...
All numbers referenced are from The
     2009 Softletter SaaS Report
Requirements Integrated




                      47%       Yes
53%                             No
76%
80%
70%         61%
60%
                        2006
50%   38%               2007
40%                     2008
30%
20%...
Major Upgrade


                             Less than once a year
        7%
  24%
                 18%         Once a ye...
Agile?




33%

                     Yes
                     No

               67%
 Release cycles are going away

 The pace of SaaS development exceeds anything
 ever seen in the industry previous

The...
 The TRUE Apotheosis of the Customer
   You are, of course, lying
   In a desktop and licensed world, it’s very difficult, if
    not impossible
   The tools available simply don’t work ...
   SaaS is 24/7/52
   SaaS is persistent across the world
   SaaS IS A COMMUNITY
   Inherent in the model
   They have transformed their community into an active
    marketplace of ideas that manages, in the main, itself
   Re...
   Voting
   Polls
   Forums
   Peer to peer communities
   Chat
   Combined with extensive data mining of their
    customer base
   This combination has never been seen by the
    ind...
   Product management is fundamentally transformed
       No MRDs
       No “tick list” management
       No acting as...
   Product management is fundamentally transformed
       Your PM organization flattens out
         No “tick list” man...
   Product management is fundamentally transformed
       Your traditional PM role disappears
       The PPM becomes th...
   Who do you think knows more about your system,
    you or your users?
   I bet they do (collectively)
   You’re an expert at building your system
   Think you’re smarter?
   Test and measu...
   Mult-tennant
   BI
   Community system
       Voting
       Polls
       Councils
       Reputation management
 ...
   All tightly integrated directly into your system
   I mean “into”
   This approach becomes integral to your marketin...
Webinar - Business Implications of SaaS Multi Tenancy
Webinar - Business Implications of SaaS Multi Tenancy
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Webinar - Business Implications of SaaS Multi Tenancy

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A webinar to look at the multi-tenancy alternatives and the impact on SaaS multi-tenancy on software business and product management

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Transcript of "Webinar - Business Implications of SaaS Multi Tenancy"

  1. 1. Business Implication of SaaS Multi-Tenancy July 16 2009
  2. 2. Agenda  Speaker Introductions » Mike Dunham » Lincoln Ventures » Rick Chapman  Scio Consulting - Presenter: Mike Dunham » Software as a Service - What is it? » SaaS & Multi-tenancy • Why is multi-tenancy important for SaaS? » Multi-tenancy Approaches  16 Ventures - Presenter: Lincoln Murphy » Business implications of the tenancy models for a SaaS provider  Softletter - Presenter: Rick Chapman » Impact of Communities and Business Intelligence in SaaS  Q&A 2 Scio Consulting International, LLC. All rights reserved.
  3. 3. Speakers  Mike Dunham – » Principal Consultant at Scio Consulting » mdunham@sciodev.com » http://www.sciodev.com  Lincoln Murphy – » Managing Director of Sixteen Ventures » lincoln@sixteenventures.com » http://www.sixteenventures.com  Rick Chapman » Managing Director of Softletter & SaaS University » rickchapman@softletter.com » http://www.softletter.com 3 Scio Consulting International, LLC. All rights reserved.
  4. 4. Q&A  Your input and feedback makes this a much better forum! 4 Scio Consulting International, LLC. All rights reserved.
  5. 5. What is Software as a Service (SaaS)? July 2009
  6. 6. What is Software-as-a-Service?  Software as a Service (SaaS) is a model of software delivery that allows applications to be provided as a service to customers across the Internet.  It is a Deployment/Delivery model » Hosted and Managed by vendor » Delivered across the Internet  It is a Service Model » End-User support and service moves to the vendor  Usage-based pricing (vs. perpetual license model of on- premise software) » Per user per month » Per transaction » Per GB of storage per month 2 Scio Consulting International, LLC. All rights reserved.
  7. 7. SaaS Evolution 3 Scio Consulting International, LLC. All rights reserved.
  8. 8. Business View – Traditional Model 4 Scio Consulting International, LLC. All rights reserved.
  9. 9. Business View – SaaS Model 5 Scio Consulting International, LLC. All rights reserved.
  10. 10. SaaS vs ASP  ASP: Application Service Provider » Single-tenant architecture (one customer per instance) » Multiple instances running (as many as there are clients), typically hosted by third parties  Disadvantages » Significant management overhead » Difficult maintenance » No economies of scale 6 Scio Consulting International, LLC. All rights reserved.
  11. 11. Multi-Tenancy  Naïve » Single Database & Code Structure – Serving Multiple Customers  Split » Single Application Database & Code Structure • Unique DB per Tenant • Unique Schema per Tenant  Virtualized » Hardware and Network Abstraction  Rational » Scalable Instances, Virtualized Infrastructure, Tuned for Reliability Maturity 7 Scio Consulting International, LLC. All rights reserved.
  12. 12. Existing Product - Levels of “SaaSification” “SaaSification” Levels Characteristic Hosted (ASP Application Full SaaS Model) Virtualization Approach Approach Tenancy Model Single Tenant Single Tenant Multi-tenant with Tenant Mgmt. Tools Modification Minimal Minimal Moderate to Required to Extensive Existing App Operations Highest Moderate Lowest Overhead Scalability of Lowest Low Highest the Approach Initial Lowest Moderate Highest Investment Sci 8
  13. 13. Key Technical Aspects of SaaS  Multi-tenancy  Integration  Scalability  Security » Load balancing » Identity management » Routing  Usability  Availability  Communication  Performance » e-mail, sms, etc.  Configuration-driven  Globalization Customization  Audit and compliance » look and feel  Backup and recovery » Functionality These factors influence App Architecture as well as Infrastructure Architecture Sci 9
  14. 14. SaaS Application Stack 10 Scio Consulting International, LLC. All rights reserved.
  15. 15. Multi-Tenancy in SaaS: The Business Case Presented July 16, 2009 via Webinar Hosted by Scio (http://sciodev.com)
  16. 16. Introduction Lincoln Murphy, Founder & Managing Director Sixteen Ventures 15+ Years On- Started and Sold Demand Product F1000-targeted Development SaaS Company I help SaaS SaaS Business Vendors make Architect more money! Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  17. 17. What SaaS Is Not Pricing Model Revenue Model Anything on the Software Web, in the Delivery Method cloud, etc. Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  18. 18. What SaaS Is Business Intellectual Architecture Property Technology Business Model Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  19. 19. What SaaS Is Functionality Commercially delivered via web focused Inherently Single-Instance, Social Multi-Tenant Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  20. 20. Decision Time: Are you a SaaS Vendor or not? Hybrid is hard; Mindset and pick one Focus Revenue Make the Recognition decision and Issues stick with it Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  21. 21. Remember! The further you stray from this clear definition of SaaS, the harder it will be for you to truly reap the benefits of being a pure-play SaaS Vendor. Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  22. 22. Multi-Tenancy Considerations Application Data Layer Infrastructure Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  23. 23. Multi-Tenancy Infrastructure Economies of Resource Scale Efficiency Implementation Virtualization Agnostic Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  24. 24. Multi-Tenancy Application Human Ease of SDLC Resource Management Efficiency No Customized Business Versions Scalability Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  25. 25. Multi-Tenancy Data Layer Aggregate Data Track Usage Advanced Implementation Monetization Agnostic Strategies Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  26. 26. Multi-Tenancy Data Layer Implementation Unique Must be Single Database per Instance Tenant Multi-Tenant Multi-Tenant Database, Database, Shared unique Schema Schema Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  27. 27. Remember! The further you stray from this clear definition of SaaS, the harder it will be for you to truly reap the benefits of being a pure-play SaaS Vendor. Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  28. 28. ASP Model Multi-Instance, Non Web-native Single-Tenant Applications Customizations No Inbuilt cause Business Revenue Models Scalability Issues Copyright© 2009 Lincoln Murphy / Sixteen Ventures. All Rights Reserved.
  29. 29. SaaS Business Architecture Consultants lincoln@sixteenventures.com http://sixteenventures.com http://twitter.com/lincolnmurphy http://linkedin.com/in/lincolnmurphy lincolnmurphy (972) 200-9317
  30. 30. This Changes Everything Rick Chapman www.softletter.com rickchapman@softletter.com
  31. 31.  At our SaaS University conference in Atlanta, Patrick Fetterman, head of marketing of Plexus, now Plex, said the following:  “We are managing 100K feature requests per year without product managers  Not possible in his space (ERP) with a licensed product
  32. 32. All numbers referenced are from The 2009 Softletter SaaS Report
  33. 33. Requirements Integrated 47% Yes 53% No
  34. 34. 76% 80% 70% 61% 60% 2006 50% 38% 2007 40% 2008 30% 20% 10% 0%
  35. 35. Major Upgrade Less than once a year 7% 24% 18% Once a year Twice a year 28% 23% Three times a year No set release schedule; as developed
  36. 36. Agile? 33% Yes No 67%
  37. 37.  Release cycles are going away  The pace of SaaS development exceeds anything ever seen in the industry previous The most successful SaaS companies will structure their operations in ways previously talked about, but never executed
  38. 38.  The TRUE Apotheosis of the Customer
  39. 39.  You are, of course, lying
  40. 40.  In a desktop and licensed world, it’s very difficult, if not impossible  The tools available simply don’t work very well  Forums  E-mail  Screaming  Surveys  Screaming
  41. 41.  SaaS is 24/7/52  SaaS is persistent across the world  SaaS IS A COMMUNITY  Inherent in the model
  42. 42.  They have transformed their community into an active marketplace of ideas that manages, in the main, itself  Requirements management driven by the community  Implementation driven by community  Innovation driven by community
  43. 43.  Voting  Polls  Forums  Peer to peer communities  Chat
  44. 44.  Combined with extensive data mining of their customer base  This combination has never been seen by the industry before
  45. 45.  Product management is fundamentally transformed  No MRDs  No “tick list” management  No acting as a stand in for the “Voice of the Customer”  No acting as a stand in for the customer in the Agile model
  46. 46.  Product management is fundamentally transformed  Your PM organization flattens out  No “tick list” management  No acting as a stand in for the “Voice of the Customer”  No acting as a stand in for the customer in the Agile model  No MRDs  Requirements management goes back to development  PMs aren’t good at use cases  They’re not Rational mavens
  47. 47.  Product management is fundamentally transformed  Your traditional PM role disappears  The PPM becomes the PM  Customer community advocate/maven  User of the community management system and wizard of insights and support  Refiner of the system  PMs (and everyone else becomes accountable)  Business analysts may be needed
  48. 48.  Who do you think knows more about your system, you or your users?
  49. 49.  I bet they do (collectively)  You’re an expert at building your system  Think you’re smarter?  Test and measure (and be accountable)
  50. 50.  Mult-tennant  BI  Community system  Voting  Polls  Councils  Reputation management  Maven management  Peer to peer  FAQ/Wiki/Blogs
  51. 51.  All tightly integrated directly into your system  I mean “into”  This approach becomes integral to your marketing, sales, and development DNA  Once implemented, traditional PM training programs become obsolete
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