Why You Need a SaaS Strategy

Sun Tzu

“Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat” – Sun Tzu, from “The Art of War”

John Lennon  

“Life is what happens to you while you’re busy making other plans.” - John Lennon

How much strategy and planning is enough in a changing world, and how can you make your organization as agile as possible to adapt to unforeseen changes and unplanned events? These are questions that managers continually wrestle with as they steer their organizations in a changing world.

Cloud computing and software as a service (SaaS) can help you manage and adapt to change, because of their rapid time to market, pay-as-you-go service fees, scalability, and support for mobile users. However, in a recent article in InformationWeek, “Why You Need a SaaS Strategy,” IT consultant Michael Biddick argues that “too many CIOs take an ad hoc approach to software as a service. That won’t cut it as SaaS use expands.”

So, according to Michael Biddick, what is an appropriate SaaS strategy that will give you the flexibility to adapt to change while protecting your organization and its assets? Michael suggests a nine-point approach to SaaS strategy:

1. Select the right provider. Continue performing rigorous analysis of the vendor, the application, security, and your ability to extract your data if you decide to switch providers.

2. Sign the right contract. Review the contract in light of its support for your changing business needs and its exit terms.

3. Have a detailed exit strategy. Make sure you can get your data and customizations back in a form that you can use if you decide to switch providers. Look for bandwidth charges that would add up if you move large amounts of data from a SaaS provider.

4. Manage the relationship. Monitor and evaluate application performance and usage to determine if the provider is meeting your needs.

5. Create a contingency plan. This is especially critical for apps that can’t go down or data that can’t be lost. Perform a weekly full data export from your SaaS providers so that you have a local copy of all of your data.

6. Dig deep on interoperability and integration. Few applications are effective in a silo, so you must ensure that your SaaS apps communicate with other online or conventional software.

7. Agree on IT’s role in supporting the product. While conventional software support such as patching an operating system and deploying a security update isn’t required, someone still has to add users, change passwords, create workflow, do screen designs, and perform other support tasks.

8. Get senior executive support and involvement. If an application service is performing a critical business function, make sure the top leadership understands the benefits and risks of SaaS.

9. Align to the company objectives. Does the company have a goal to reduce capital spending, or shorten the time to deliver services? SaaS must be considered in that broader mission.

I think these are great suggestions for ensuring that a provider and an application meet your needs, while you still benefit from the rapid time to market, lower capital and operational costs, and flexibility that SaaS provides. This approach provides the strategy and tactics that Sun Tzu advocates in his above quote, with the ability to adapt to changes and events outside of your plans as John Lennon suggests in his quote.

Another point to consider is managing the number of SaaS vendors. Although SaaS provides a greater choice of vendors because of its low barriers to entry, you will probably need to balance that freedom of choice with the ability to manage multiple contracts, relationships, and vetting processes. 

What is your SaaS strategy, and how does it compare with Michael Biddick’s nine-point strategy?