SB 309
Embracing SaaS: Strategies
of Winning Organizations
Armen Najarian, IBM

© 2014 IBM Corporation
Please Note
IBM’s statements regarding its plans, directions, and intent are subject to change or withdrawal without notic...
Cloud computing is a force for business growth; Software
as a Service (SaaS) is a fast-growing segment within cloud
Leadin...
To gain a deeper understanding of how organizations
approach SaaS, we surveyed 879 IT and line of business
(LOB) decision ...
Though reducing costs is the #1 motivator for considering SaaS, the
more common result is a gain in competitive advantage
...
To learn from the leading organizations, we segmented
enterprises by level of SaaS adoption and competitive
advantage
High...
Pacesetters are motivated by higher-order values that
drive competitive advantage and market agility
Segment

Top three
mo...
Dispelling a myth, leadership isn’t achieved by LOB
circumventing IT. Pacesetters show the strongest level of
IT + LOB col...
In fact, Pacesetter IT and LOB tend to regard each other as
strategic partners on SaaS – one of two essentials for
achievi...
Pacesetters also align their organizations around a
cohesive enterprise-wide SaaS strategy – the other key to
competitive ...
This approach enables Pacesetters to go beyond enterprise
efficiency – achieving deeper collaboration, better decisionmaki...
Pacesetters are experts at using SaaS to increase selfservice capability, optimize operations and improve
application agil...
Pacesetters also use SaaS to increase collaboration and
improve core business relationships across their
organizations and...
SaaS enables Pacesetters to convert big data into new
insights and improve decision making
Real world example:
PAC2000A

A...
Finally, Pacesetters employ SaaS to unlock market agility
and become more responsive to market and customer needs
Real wor...
Want to hone your own competitive edge through SaaS?
Set ambitious objectives
Consider the full range of
benefits that Saa...
IBM SaaS Portfolio Overview

17
CEOs identify technology as the most important external
force impacting their organizations.
2004

2006

2008

2010

2012
...
Tap into it.
More than 100 SaaS applications.

Accelerate your innovation
Accelerate your innovation with over 100 best-in...
Shared IT/LOB strategy encourages a collaborative
SaaS buying agenda.
Line of Business is closest to the customer. IT is a...
IBM lets you tap into Role-Based Cloud Suites.
Procurement

Human Resources

Contract Management
Spend Analysis
Strategic ...
BPaaS solutions let you accelerate business process
innovation with security, availability, and elasticity.
Reinvent busin...
High-value applications: delivered at scale and helping
our clients innovate today.
300,000 connected for
global trading e...
Why do the world’s leading companies rely on IBM SaaS
solutions?
 Broad coverage for front office roles with 8 SaaS suite...
Engage Online
 SocialBiz User Group socialbizug.org
– Join the epicenter of Notes and Collaboration user groups
 Follow ...
Thank You! Please reach out with questions!

Armen Najarian
@ArmenNajarian
Program Director
WW SaaS Marketing
armen@us.ibm...
 Access Connect Online to complete your session surveys using any:
– Web or mobile browser
– Connect Online kiosk onsite
...
Acknowledgements and Disclaimers
Availability. References in this presentation to IBM products, programs, or services do n...
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Embracing SaaS: Strategies of Winning Organizations

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Find out how forward-thinking enterprises are leveraging Software-as-a-Service (SaaS) to propel their businesses forward. Hear the results of new research from the IBM Center for Applied Insights and a global survey of over 800 Business and IT decision-makers driving SaaS and cloud adoption decisions. The study reveals that over 80% of respondents embrace SaaS to enhance the customer experience, enable more strategic business decisions, and accelerate internal and external collaboration. Learn how leading companies are using SaaS as a competitive advantage across the enterprise.

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Embracing SaaS: Strategies of Winning Organizations

  1. 1. SB 309 Embracing SaaS: Strategies of Winning Organizations Armen Najarian, IBM © 2014 IBM Corporation
  2. 2. Please Note IBM’s statements regarding its plans, directions, and intent are subject to change or withdrawal without notice at IBM’s sole discretion. Information regarding potential future products is intended to outline our general product direction and it should not be relied on in making a purchasing decision. The information mentioned regarding potential future products is not a commitment, promise, or legal obligation to deliver any material, code or functionality. Information about potential future products may not be incorporated into any contract. The development, release, and timing of any future features or functionality described for our products remains at our sole discretion Performance is based on measurements and projections using standard IBM benchmarks in a controlled environment. The actual throughput or performance that any user will experience will vary depending upon many factors, including considerations such as the amount of multiprogramming in the user’s job stream, the I/O configuration, the storage configuration, and the workload processed. Therefore, no assurance can be given that an individual user will achieve results similar to those stated here. 2
  3. 3. Cloud computing is a force for business growth; Software as a Service (SaaS) is a fast-growing segment within cloud Leading organizations are using cloud to gain competitive advantage Compared to peers, these leaders are*: SaaS is a key growth segment within cloud**: 79% more likely to rely on cloud to locate and leverage expertise anywhere in the ecosystem The Worldwide SaaS market is forecasted to grow at a CAGR of 20.2% in 2012-2017, growing from US$18.2 billion in 2012 to US$45.6 billion in 2017 136% more likely to use cloud to reinvent customer relationships 170% more likely to use cloud-based analytics extensively to derive insights *Source: IBM Center for Applied Insights Under cloud cover: How leaders are accelerating competitive differentiation **Source: Gartner Forecast: Public Cloud Services, Worldwide, 2011-2017, 4Q13 Update, Ed Anderson, Lai-ling Lam, Yanna Dharmasthira, et al., December 26, 2013 For more info, visit: ibm.com/ibmcai/saas 3
  4. 4. To gain a deeper understanding of how organizations approach SaaS, we surveyed 879 IT and line of business (LOB) decision makers Respondent distribution (Organizations that currently deploy SaaS, spanning six countries* and 23 industries) Role 12% C-level LOB** 42% LOB VPs, Directors, Managers** 10% C-level IT 36% IT VPs, Directors, Managers Organization size (# of employees) 20% 10,000+ 40% 2,500 – 9,999 Geography 40% <2,500 43% Mature markets 57% Growth markets Growth markets surveyed: Brazil, China, India, South Africa Mature markets surveyed: UK, USA *To smooth possible geographic distortions, responses were weighted based on an IBM assessment of each country’s total IT spend. **LOB functions surveyed: Marketing, Procurement, Supply Chain, Sales/Commerce, Finance, Customer Service, Human Resources and Legal Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 4
  5. 5. Though reducing costs is the #1 motivator for considering SaaS, the more common result is a gain in competitive advantage SaaS was shown to reduce total cost of ownership (TCO) of applications But, almost half of enterprises are also gaining competitive advantage through SaaS 5 Reduce TCO (vs. on-premise) 41% Gain competitive advantage Source: IBM Center for Applied Insights Champions of Software as a Service: How SaaS is helping companies secure powerful competitive advantage For more info, visit: ibm.com/ibmcai/saas 47% © 2014 IBM Corporation
  6. 6. To learn from the leading organizations, we segmented enterprises by level of SaaS adoption and competitive advantage High Pacesetters 19% Level of SaaS adoption* Challengers 41% Pacesetters (19% of the total) have the highest level of SaaS adoption and are gaining competitive advantage through these broad efforts Top 3 Motivators: Collaboration, Customer Experience, Time to Market Challengers (41%) have adopted SaaS more narrowly, but are gaining competitive advantage through their existing SaaS deployments Top 3 Motivators: Reducing TCO, Application Agility, Decision Making Chasers 40% Chasers (40%) are slower to adopt SaaS and gain competitive advantage through it Top 3 Motivators: Reduced TCO, Application Agility, Collaboration *Based on # of application areas deployed as SaaS Low Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas High agreement Low agreement Gaining competitive advantage through SaaS 6
  7. 7. Pacesetters are motivated by higher-order values that drive competitive advantage and market agility Segment Top three motivators Chasers (40% ) Challengers (41%) Pacesetters (19%) Reduced TCO Reduced TCO Collaboration Application agility Collaboration Application agility Decision making Customer experience Time to market How are Pacesetters gaining their competitive edge? Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas
  8. 8. Dispelling a myth, leadership isn’t achieved by LOB circumventing IT. Pacesetters show the strongest level of IT + LOB collaboration. The power of collaboration Pacesetters surpass Chasers 70% 36% 35% Strong IT/LOB collaboration around SaaS security 24% Chasers Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 8 +97% 39% Strong IT/LOB collaboration on SaaS selection/deployment Pacesetters +79% 71% SaaS strengthens the IT/LOB relationship +46%
  9. 9. In fact, Pacesetter IT and LOB tend to regard each other as strategic partners on SaaS – one of two essentials for achieving competitive advantage Fostering strategic partnerships Pacesetters surpass Chasers 72% IT respondents view LOB as a strategic partner for SaaS +227% 37% 22% 66% LOB respondents view IT as a strategic partner for SaaS 54% 31% Pacesetters Challengers Chasers Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 9 +113%
  10. 10. Pacesetters also align their organizations around a cohesive enterprise-wide SaaS strategy – the other key to competitive advantage Strategic approach to SaaS Chasers Challengers Pacesetters % Pacesetters surpass Chasers Has a mature and cohesive enterprise-wide SaaS strategy 31% 46% 71% +129% SaaS is a critical piece of enterprise cloud strategy 12% 18% 48% +300% SaaS provider is a strategic partner/advisor 28% 56% Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 10 86% +207%
  11. 11. This approach enables Pacesetters to go beyond enterprise efficiency – achieving deeper collaboration, better decisionmaking, and market agility 11 Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas
  12. 12. Pacesetters are experts at using SaaS to increase selfservice capability, optimize operations and improve application agility Enterprise efficiency (% using SaaS to achieve to significant degree) Chasers Challengers Pacesetters % Pacesetters surpass Chasers Increased self-service capability for applications 26% 36% 74% +185% Optimized business processes and workflows 31% 41% 70% +126% Improved application agility (flexibly deploy and implement solutions) 28% 41% 66% +136% Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 12
  13. 13. Pacesetters also use SaaS to increase collaboration and improve core business relationships across their organizations and ecosystems Real world example: SafeGuard World International This top provider of managed payroll and employment outsourcing needed to support an aggressive global expansion strategy. It used a SaaS-based collaboration, knowledge-sharing and social project management solution that enables its worldwide teams to respond more quickly and effectively to fast-breaking issues and opportunities. Result: 20% reduction in implementation time Deeper collaboration (% using SaaS to achieve to significant degree) Chasers Challengers Increased collaboration across organization and ecosystem 34% 37% Improved core business relationships 28% 44% Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 13 Pacesetters 61% 71% +79% +154%
  14. 14. SaaS enables Pacesetters to convert big data into new insights and improve decision making Real world example: PAC2000A An Italian retail giant needed to overhaul its manual price management system in order to keep up with the competition. It implemented a SaaS-based price optimization solution, which offered frequent analytics on cost and competitive data. This changed PAC2000A from an organization that based pricing decisions on “gut feel” to one that leverages analytics to make more informed decisions and predictive forecasts. Result: 2.4% increase in comparable store sales Better decision making (% using SaaS to achieve to significant degree) Chasers Leveraged analytics across organization to turn big data into insights Achieved better decision making Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 14 Challengers Pacesetters % Pacesetters surpass Chasers 34% 50% 72% +112% 28% 41% 72% +157%
  15. 15. Finally, Pacesetters employ SaaS to unlock market agility and become more responsive to market and customer needs Real world example: Virgin Atlantic A major carrier – with more than 9,000 employees, 41 aircrafts and carrying 5 million passengers/year – wanted to redesign its website to be more user-friendly. It used a SaaS analytics solution to aggregate historical and current site usage data to understand customer use and decision making, as well as gain insights to transform the website. The airline has gradually released new pages and continued to refine the site based on customer data. Result: 10% increase in flight bookings, 7% increase in average booking value Market agility (% using SaaS to achieve to significant degree) Chasers Chasers Pacesetters % Pacesetters surpass Chasers Increased innovation 29% 40% 66% +126% Reduced time to market 30% 42% 71% +137% Improved customer experience 30% 47% 68% +127% 30% 44% 71% +137% Changed organization’s business model Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 15
  16. 16. Want to hone your own competitive edge through SaaS? Set ambitious objectives Consider the full range of benefits that SaaS could help you attain. Take a more strategic and collaborative approach Incorporate your SaaS initiatives within an enterprise-wide cloud strategy. • Where can you speed application deployment and implementation? • What elements would round out your current SaaS strategy? • Which business processes could be better optimized? • How could you better integrate SaaS strategy into a broader cloud strategy? • How could broader, smoother and more frequent collaboration inside and outside your organization improve results? • Which teams could do a better job by leveraging big data to inform decision making? • • Are you exerting just the right amount of control over SaaS deployment? What changes are needed to keep your governance structures current? Source: IBM Center for Applied Insights Champions of competitive advantage: Inside the most successful SaaS playbooks For more info, visit: ibm.com/ibmcai/saas 16 Broaden your collaborative base Multiply your chances of success by encouraging close IT and LOB collaboration. • Are you leveraging the best minds of IT and LOB for SaaS selection and investment decisions? • Where else could IT and LOB gain from each other’s perspectives and resources? SaaS deployment? Security? • How can SaaS help you tap valuable expertise beyond your organization?
  17. 17. IBM SaaS Portfolio Overview 17
  18. 18. CEOs identify technology as the most important external force impacting their organizations. 2004 2006 2008 2010 2012 2013 1 1 1 1 1 1 Technology Factors 2 2 2 2 2 2 Market Factors 3 3 3 3 3 3 Macro-economic Factors 4 4 4 4 4 4 People Skills 5 5 5 5 5 5 Regulatory Concerns 6 6 6 6 6 6 Socio-economic Factors 7 7 7 7 7 7 Globalization 8 8 8 8 8 8 Environmental Issues 9 9 9 9 9 9 Geopolitical Factors IBM CEO Study, 2004-2013 18
  19. 19. Tap into it. More than 100 SaaS applications. Accelerate your innovation Accelerate your innovation with over 100 best-in-class software-as-a-service (SaaS) applications and business process-as-a-service (BPaaS) capabilities, all delivered with the enterprise-grade security, availability and elasticity you expect from IBM. Accelerate business process innovation Deliver business analytics at point of impact Connect people with collaborative business networks 19
  20. 20. Shared IT/LOB strategy encourages a collaborative SaaS buying agenda. Line of Business is closest to the customer. IT is ahead of the curve on technology. By collaborating to address IT needs, they can jointly drive leadership and innovation Business Needs Innovative solutions Faster time to value IT Needs Up-to-date capabilities Security Privacy Always available Scalability Agility Governance 20 Prevent “Shadow IT”. Create a Collaborative IT environment with a shared cloud strategy, vision, and execution plan.
  21. 21. IBM lets you tap into Role-Based Cloud Suites. Procurement Human Resources Contract Management Spend Analysis Strategic Sourcing Talent Management Learning and Certification Employee Onboarding Legal Customer Care & Support Engagement Advice Experience Management Client Success Social Business Collaboration Suite City Operations Sales & Commerce Transportation Planning Water Management Utility Optimization eCommerce Performance Analytics Quote Management IT Operations Finance Reporting Risk Analysis Compensation Models 21 Contract Management Risk Analytics Document Management Marketing Demand Generation Campaign Analytics Agency Collaboration Service Management Security
  22. 22. BPaaS solutions let you accelerate business process innovation with security, availability, and elasticity. Reinvent business operations with Business Process Management tools • • IBM Blueworks Live IBM Business Process Manager Ready-to-use market-leading solutions let you collaborate, capture process knowledge, and improve your business in under 48 hours. 22 Leverage industry vertical solutions • • IBM SmartCloud Service Delivery for electronics IBM Panorama Industry expertise and experience to help you set policies, load data, and customize your ready-to-use applications. Improve speed by sourcing business process expertise • • • IBM GPS – order to cash with AR Collect IBM Payment Systems IBM GPS – recruitment process outsourcing with Kenexa On-premise expertise, insights, analytics, and best-practices to improve business processes and drive value.
  23. 23. High-value applications: delivered at scale and helping our clients innovate today. 300,000 connected for global trading entities 5.5 million daily transactions exchanged via IBM B2B IBM clients cloud 60,000 users of IBM digital marketing tools send 130 million monthly emails 180 Million transportation management transactions annually 120 million candidate records on the Kenexa talent management platform… …accessed daily by 80,000 candidates and more than one million hiring managers 23
  24. 24. Why do the world’s leading companies rely on IBM SaaS solutions?  Broad coverage for front office roles with 8 SaaS suites for the c-suite  Deep domain expertise across 18 industries delivered through IBM Global Business Services  Availability in over 50 countries today  Customer-centric value with outcome-based subscription models  Enterprise-grade security standards  Flexible deployment across private, public, and hybrid cloud environments  Large and expanding global SaaS business partner community 24
  25. 25. Engage Online  SocialBiz User Group socialbizug.org – Join the epicenter of Notes and Collaboration user groups  Follow us on Twitter – @IBMConnect and @IBMSocialBiz  LinkedIn http://bit.ly/SBComm – Participate in the IBM Social Business group on LinkedIn:  Facebook https://www.facebook.com/IBMSocialBiz – Like IBM Social Business on Facebook  Social Business Insights blog ibm.com/blogs/socialbusiness – Read and engage with our bloggers 25
  26. 26. Thank You! Please reach out with questions! Armen Najarian @ArmenNajarian Program Director WW SaaS Marketing armen@us.ibm.com 650-504-3430 26
  27. 27.  Access Connect Online to complete your session surveys using any: – Web or mobile browser – Connect Online kiosk onsite 27
  28. 28. Acknowledgements and Disclaimers Availability. References in this presentation to IBM products, programs, or services do not imply that they will be available in all countries in which IBM operates. The workshops, sessions and materials have been prepared by IBM or the session speakers and reflect their own views. They are provided for informational purposes only, and are neither intended to, nor shall have the effect of being, legal or other guidance or advice to any participant. While efforts were made to verify the completeness and accuracy of the information contained in this presentation, it is provided AS-IS without warranty of any kind, express or implied. IBM shall not be responsible for any damages arising out of the use of, or otherwise related to, this presentation or any other materials. Nothing contained in this presentation is intended to, nor shall have the effect of, creating any warranties or representations from IBM or its suppliers or licensors, or altering the terms and conditions of the applicable license agreement governing the use of IBM software. All customer examples described are presented as illustrations of how those customers have used IBM products and the results they may have achieved. Actual environmental costs and performance characteristics may vary by customer. Nothing contained in these materials is intended to, nor shall have the effect of, stating or implying that any activities undertaken by you will result in any specific sales, revenue growth or other results. © Copyright IBM Corporation 2014. All rights reserved.  U.S. Government Users Restricted Rights - Use, duplication or disclosure restricted by GSA ADP Schedule Contract with IBM Corp.  Please update paragraph below for the particular product or family brand trademarks you mention such as WebSphere, DB2, Maximo, Clearcase, Lotus, etc.  IBM, the IBM logo, ibm.com, [IBM Brand, if trademarked], and [IBM Product, if trademarked] are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol (® or ™), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at www.ibm.com/legal/copytrade.shtml If you have mentioned trademarks that are not from IBM, please update and add the following lines: [Insert any special 3rd party trademark names/attributions here] Other company, product, or service names may be trademarks or service marks of others. 28

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