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Dani Shomron, iSC - On Dinosaurs and Men


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Presented by Dani Shomron, SaaS Strategist and Founder and CEO of the Israel SaaS Center. The presentation was prepared for and presented at SafeNet's LicensingLive - Monetizing Software in the Cloud event series in April 2011.

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Dani Shomron, iSC - On Dinosaurs and Men

  1. 1. On Dinosaurs and Men Dani Shomron April 2011
  2. 2. Transition to SaaS –Revolution, not Evolution
  3. 3. The SaaS OrganizationR&D Quality Ops Support Sales Marketing Finance PS Legal • Not another delivery mechanism • Paradigm shift • Selling a Service not a Product • Will affect every silo in the organization • Introduce new functions and entities
  4. 4. EngineeringR&D Quality Ops Support Sales Marketing Finance PS Legal • Modify (rewrite?) architecture • Simpler development – single platform • Support „service readiness‟ • Support scalability & high availability • Release cycles reduced to weeks • Adopt agile S/W development (e.g. SCRUM) • Engineers interact more closely with end-users
  5. 5. Quality AssuranceR&D Quality Ops Support Sales Marketing Finance PS Legal • Shorter release cycles • Support single platform (multiple browsers) • New testing disciplines:  Performance  Scalability  Security • Test interaction between H/W & S/W
  6. 6. OperationsR&D Quality Ops Support Sales Marketing Finance PS Legal • New group with responsibility for „keeping the lights on‟. 24X7 • Build, manage, monitor, respond. • Improve uptime, performance ,scalability • DBAs, System & Network, App Engineers • Work with R&D, QA, Sales, Support, PS • The hub of the offering, process oriented
  7. 7. Customer SupportR&D Quality Ops Support Sales Marketing Finance PS Legal • User experience, customer sat and success are paramount support has important role, higher skills, higher pay • All IT communications at your doorsteps • 24X7 Customer service mode • Knowledge upgraded from installation / maintenance to app/domain knowledge • Develop problem resolution skills
  8. 8. SalesR&D Quality Ops Support Sales Marketing Finance PS Legal • A whole new ball game:  From Elephant hunting to cyber sales  From selling a product to selling a service  From perpetual to subscription  From hunters to farmers  Compensation up-front to spread over a year or more  Sales cycles shorten dramatically • Partners, channels, resellers, SaaS aggregators play an important role for maximum exposure
  9. 9. MarketingR&D Quality Ops Support Sales Marketing Finance PS Legal• Marketing and Sales become tightly coupled with a ‘Sales 2.0’ approach• More dependence on automation and lead generation tools• Guerilla Marketing thru web analysis tools, email campaigns, newsletters, resource center, social networks• Free trials and Freemiums• Less control over what information is available to potential customers• Consider building an open community around users and developers.
  10. 10. FinanceR&D Quality Ops Support Sales Marketing Finance PS Legal • Change in Revenue stream and revenue recognition • Financial systems capturing and forecasting deferred revenue will be needed. • Capturing and forecasting Financial systems for deferred revenue • Billing is more complex: metering, collections, service level compensation and renewals • New systems will need to integrate with the existing financial systems.
  11. 11. Professional ServicesR&D Quality Ops Support Sales Marketing Finance PS Legal • Switch from installation/upgrades to app know-how and business process • Configuration, integration, reports. • Most of the work will be done remotely - traveling time and costs will be reduced • Education services will drop part of the curriculum pertaining to installation and maintenance
  12. 12. LegalR&D Quality Ops Support Sales Marketing Finance PS Legal • Service contracts - not software contracts. • New entities: SLAs, renewals and add-on services • Contracts with service providers –hosting, ISPs , etc. Compliance Compliance • How would selling a service differ from selling a product? • Do you need to be compliant to all the requirements that your customers are? • Would you need a SAS 70, HIPPA, PCI certification? • Would your hosting provider need one? All of these are still unclear in this emerging market.
  13. 13. Top 5 “quiet killers” of SaaccessThe more successful the ISV, the more entrenched inthe old paradigm (SAP) - Old Habits are hard to break:1. Switch from product to service.2. Shift of focus to operations and customer service.3. Change pace of dev and delivery.4. Push back - Internal resistance to change: R&D, QA, Services, Sales. (MMS)5. Fear of cannibalization of existing sales
  14. 14. The Secret SauceVision & Leadership• Paradigm shift – need C&V level commitment• Pay attention to customers‟ needs• Ensure a buy-in at all levels – make it a company goal - get Sales involved early
  15. 15. Path to Success• Offer a sub-system as a POC• Acquire SaaS company with complimentary product.• Hybrid stage. Insist on phasing out.• If possible – spin out company• Integrate existing solutions. Many cloud solutions available• Get help. Work with Partner not Vendor
  16. 16. The real reason why Dinosaurs became extinct(Gary Larson)• Q&A