Intelligent Enterprise

I happened to catch this article by Jon Brodkin of NetworkWorld. It basically recounts recent research from Saugatuck Technology, highlighting some of the issues and opportunities when working with SaaS.

"'Use of software-as-a-service has more than doubled since the beginning of 2006 and will double again by the end of the decade, creating challenges for customers and vendors as they attempt to integrate hosted offerings with on-premise software,' according to research released this week by Saugatuck Technology."

Core to this finding is the fact that you can't just subscribe to a SaaS vendor and hope for the best. Indeed, you need to consider the use of SaaS as part of the overall IT strategy, and thus part of the core architecture. Many who miss that fact end up doing "catch-up football" at some point, quickly trying to figure out ways to get their SaaS vendors aligned with their core system integration strategy, and leveraging data that exists within SaaS applications for key management decisions. I have a few clients tackling this now, and it's much easier to do it before your SaaS application takes off rather than after - when it's like changing tires on a moving vehicle.

"'SAAS is going to complicate and hybridize user IT and business operational environments faster, and to a greater degree than most user and vendor executives understand at this point,' Saugatuck writes. 'The vast majority of user IT departments will simply not have the resources to handle the influx of enterprise-level SAAS' expected to occur over the next seven years."

Many within global 2000 organizations have grown frustrated with the speed that their IT organizations can produce/procure and integrate core information systems that meet their needs. Thus, many have turned to SaaS as a "quick and dirty" solution for applications such as CRM, as well as niche applications such as logistics management. They go to the Web site, sign up for 10 seats using their credit cards, and they are off and running.

However, these applications quickly become core to the business, and as such, need to be tightly integrated with information systems inside the firewall. Thus, IT scrambles to quickly build interfaces and integration mechanisms, perhaps missing some of the more important steps and not living up to emerging standards, such as SOA.

This is not just an SMB thing. Indeed, SaaS is now a Global 2000 force, also found in government agencies as well.

"'Everyone thinks SAAS is a [small to midsize business] phenomenon,' says William McNee, report co-author and president and CEO of Saugatuck Technology 'While that is true, it is crossing all kinds of customers.'"

So, if you're looking to use SaaS, consider the following:

1. Do strategic planning around the use of any SaaS-delivered application, as you should any application, but also make sure you don't hinder the speed of adoption.

2. Make sure the application has an integration strategy so those outsourced business processes can work and play well with processes inside the firewall.

3. Budget the resources required to support SaaS, and do so with a practical understanding of the role SaaS plays. While some think you need no resources to support SaaS, that is so not true. However, SaaS is not as resource-intensive as traditional enterprise applications.

Application integration and service oriented architecture expert David Linthicum heads the product development, implementation and strategy consulting firm The Linthicum Group. Write him at david@linthicumgroup.com.