SaaS – A risk or opportunity for software vendors?

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SaaS – A risk or opportunity for software vendors?
Conference of Roland Pfeiffer, CEO Uniserv GmbH, for the SaaSKon fair trade 2009 in Stuttgart (DE);

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  • Product: It can't fail – the customer needs training in any case Service: The customer must manage in any case.
  • Product: It can't fail – the customer needs training in any case Service: The customer must manage in any case.
  • SaaS – A risk or opportunity for software vendors?

    1. 1. SaaS – A risk or opportunity for software vendors? Roland Pfeiffer, CEO Uniserv GmbH, for the SaaSKon 2009
    2. 2. Relationship between on-premise and on-demand solutions <ul><li>Extremely &quot;ideologically&quot; charged discussion </li></ul><ul><li>Characterised by differing interests of the vendors </li></ul><ul><li>Challenge for anyone who develops and markets on-premise solutions today </li></ul>
    3. 3. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    4. 4. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    5. 5. What is our position in the market? <ul><li>Approx. 120 employees </li></ul><ul><li>Annual turnover approx. 20 million euros </li></ul><ul><li>800 mostly large customers in all sectors in western Europe and the USA </li></ul><ul><li>Direct sales and sales and marketing partners in Europe and North America </li></ul>The largest dedicated European supplier of data quality solutions
    6. 6. Uniserv - undergoing constant change since 1969 <ul><li>Range of solutions </li></ul><ul><li>Technological changes </li></ul>Main frame systems Client/ Server SOA SaaS
    7. 7. Data quality problems are business problems &quot;If the quality level of the products and services of your company had the same quality level as the data in your databases, would your company survive or go out of business?&quot; (Larry English) &quot;The greatest problem with respect to data quality is the completeness of the data - holes, gaps, incorrect information. Garbage in, garbage out. Companies must consider data quality.&quot; .(Doug Laney, vice president of Meta Group) &quot;The quality of customer data degrades by two percent a month.&quot; PriceWaterhouse Coopers &quot;Poor data is the reason for postal items going astray, production with wrong addresses, multiple deliveries or incorrect performance indicators in the reporting.&quot; (Dr. Carsten Bange, Barc) &quot;In the future, Fortune 1000 companies will lose more money through inefficiency caused by data quality problems than they spend on data warehouse and CRM initiatives.&quot; (Ted Friedman, Gartner)
    8. 8. Particular features of our offer SCNE Directories <ul><li>Postcodes and streets </li></ul><ul><li>Companies </li></ul><ul><li>Products </li></ul>Services <ul><li>Parsing and standardization </li></ul><ul><li>Validation against directories </li></ul><ul><li>Matching </li></ul>Tools <ul><li>Administration </li></ul><ul><li>Workflow management </li></ul><ul><li>Service configuration </li></ul><ul><li>Offer consists of services </li></ul><ul><li>Real-Time and Batch </li></ul><ul><li>Utilization via tools (batch) or integrated in applications (real-time and batch) </li></ul>
    9. 9. In which applications do we solve these problems? Data migration projects Operative Business Applications Analytical business applications CPM BI / BDW Compliance Block lists Dialogue and direct marketing Enterprise Architectures MDM / CDI SOA on-premise on-demand ERP CRM eBusiness
    10. 10. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    11. 11. Starting point for Uniserv SaaS offer in 2001 <ul><li>Web shops are mushrooming </li></ul><ul><li>Massive acquisition of addresses without checking </li></ul><ul><li>Provision of interactive address validation as an SaaS offer </li></ul>WWW . com WWW . com
    12. 12. Cannibalization worries
    13. 13. Success story <ul><li>Consistently high growth rates in comparison to licence sales </li></ul><ul><li>Interesting customer projects for major customers </li></ul><ul><li>Dovetailing with licence business instead of cannibalization </li></ul>
    14. 14. DQ Services on-premise Web Service AT DE
    15. 15. DQ Services on-demand Internet Web Service ES … IT AT
    16. 16. DQ Services on-premise and on-demand Internet Web Service AT DE Web Service ES … IT
    17. 17. SCENE Turning the discussion on its head on Premise on Demand <ul><li>Abandoning inward-looking approach </li></ul><ul><li>Focussing on customer needs </li></ul><ul><li>Accepting a variety of customer situations </li></ul>Cash Cow Distribution channels Commission Release management Budget IT strategy Availability Quantities
    18. 18. SCENE Turning the discussion on its head <ul><li>Abandoning inward-looking approach </li></ul><ul><li>Focussing on customer needs </li></ul><ul><li>Accepting a variety of customer situations </li></ul>on Premise on Demand Cash Cow Distribution channels Commission Release management Budget IT strategy Availability Quantities
    19. 19. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    20. 20. New opportunities outweigh cannibalization risks on Premise Potential on Demand Potential
    21. 21. New customer segments through SaaS <ul><li>Customers with smaller quantities of data </li></ul><ul><li>Customers with smaller quantities of data in individual countries </li></ul><ul><li>Customers with budget constraints </li></ul><ul><li>Customers with on-demand applications </li></ul><ul><ul><li>e.g. salesforce.com </li></ul></ul><ul><ul><li>e.g. Oracle CRM on Demand </li></ul></ul>Opportunities Opportunities Opportunities Opportunities Opportunities Opportunities Opportunities Opportunities Opportunities
    22. 22. Extension of our SaaS offer <ul><li>Cleansing and enhancement of data in batch processing </li></ul><ul><li>Interactive use of the Batch Services via HTML pages </li></ul><ul><li>Integration in applications via Web-Service interface </li></ul><ul><li>Display in in-house portal </li></ul>http://www.data-quality-on-demand.com/
    23. 23. Further interlinking with licence sales <ul><li>Mixed use of on-premise and on-demand </li></ul><ul><li>Integration in OEM products with both options </li></ul><ul><li>Offer for service providers with both options </li></ul><ul><li>Plug-ins for business applications with both options </li></ul>
    24. 24. Set-up of an in-house Internet sales department <ul><li>Lead generation for online marketing (e.g. Google AdWords) </li></ul><ul><li>Prospective customer care via in-house sales office </li></ul><ul><li>Exploitation of new customer segments (and making them profitable) </li></ul><ul><li>Leads and branding for on-premise solution as a &quot;by-product&quot; </li></ul>
    25. 25. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    26. 26. Challenges in product design and provision User support User interfaces Release and version management
    27. 27. User support – On-premise <ul><li>No control and information on the behaviour and experience of the user </li></ul><ul><li>User contact only for exceptional problems </li></ul><ul><li>No user contact could mean: </li></ul><ul><ul><li>User is (more or less) successful in using the product </li></ul></ul><ul><ul><li>User has given up, different priorities, project postponed, … </li></ul></ul>User support is mainly reactive without knowledge of the user activity
    28. 28. User support – On-demand <ul><li>Complete control and information on the behaviour and indications of the experience of the user </li></ul><ul><li>Transparency about whether the user </li></ul><ul><ul><li>is (more or less) successful in using the service </li></ul></ul><ul><ul><li>does not work with the service </li></ul></ul><ul><ul><li>gets &quot;stuck&quot; at certain points </li></ul></ul>User support is proactive based on knowledge of the user activity
    29. 29. User interfaces – On-premise <ul><li>Responsibility for effective use lies with the customer </li></ul><ul><li>Investment in licence price must pay back </li></ul><ul><li>Training of the users is acceptable and desired </li></ul>Systems from experts for experts who wish to squeeze out the last drop
    30. 30. User interfaces – On-demand <ul><li>Responsibility for effective use lies with the supplier </li></ul><ul><li>No vendor lock-in through licence price </li></ul><ul><li>Application must be directly operable without training </li></ul>Systems for &quot;average users&quot; which the beginner can also easily manage
    31. 31. Release and version management – On-premise <ul><li>General support of different platforms (hardware, operating systems) </li></ul><ul><li>Support of a great variety of application servers and databases </li></ul><ul><li>(Relatively) long release cycles owing to the high level of work for us (porting) and the customer (installation, test) </li></ul>Complex release and version management with a (relatively) low cycle rate
    32. 32. Release and version management – On-demand <ul><li>One platform (hardware, operating systems) </li></ul><ul><li>One application server and one database </li></ul><ul><li>(Relatively) short release cycles owing to the low level of work for us (porting) and no work for the customer (installation, test) </li></ul>Lean release and version management with a high cycle rate
    33. 33. The thread Conclusion What are the challenges? What opportunities do we see with SaaS? What is our experience with SaaS? Who we are and what we do
    34. 34. Conclusion <ul><li>The opportunities (=new customer segments) outweigh the risks (=cannibalization of the on-premise offer). </li></ul><ul><li>The licence business can profit from online marketing and branding. </li></ul><ul><li>An SOA-based approach for the on-premise solution facilitates provision on-demand. </li></ul><ul><li>Core modules can be reused, user interfaces have to be redesigned to some extent. </li></ul><ul><li>The focus must be on a change in thinking from product to service. </li></ul>For Uniserv, on-premise and on-demand do not mean &quot;either … or&quot; but &quot;both … and&quot;
    35. 35. 0 Uniserv GmbH Rastatter Str. 13 75179 Pforzheim Germany Tel. +49 7231 936-0 Fax +49 7231 936-3002 [email_address] www.uniserv.com

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