‘Initial concerns about SaaS security, response time and service availability have diminished for many organisations,’ says Sharon Metz, research director at Gartner. But these have been replaced by concerns about data fragmentation and integration, due diligence and governance, implementation strategy and total cost of ownership, reflecting changes in the way that SaaS is sold, consumed and perceived by vendors and buyers – if not the apps that are proving most popular.
According to research from Gartner, the SaaS sector that generated most revenue during 2010 was (perhaps unsurprisingly) content, communications and collaboration, which includes apps such as blogs, content management, web conferencing and wiki platforms. This is followed in volume of sales by the customer relationship management (CRM) category, where the lion’s share of the revenue is generated (again, unsurprisingly) by sales force automation software.
Gartner also reports growing use of other SaaS business process apps such as e-commerce, in business to consumer environments, although this is an area where buyers have some reservations. As buyers are becoming more sophisticated, some are expressing concerns about the impact that SaaS systems can have on their total IT portfolio, the challenges of integrating SaaS and on-premise applications, and uncertainty over data ownership (client data versus aggregated data).
A growing awareness of these issues is also being reported by the researcher Forrester – and with reference to many types of SaaS application. ‘The siloed, business-led SaaS deployments of the 2000’s are yielding to greater due diligence, planning and integration with existing sourcing and IT processes,’ reports Liz Herbert, principal analyst, Forrester. She notes that during 2010, firms were approaching SaaS ‘more strategically and in a more centralised way compared to prior years’.
This trend is confirmed by Gartner. ‘There is increasing involvement from executives in purchasing decisions, as well as greater participation from IT in the purchase process,’ reports Metz. This is something she attributes to evolutionary changes in the marketplace: SaaS deals are growing in size and monetary value, the SaaS footprint is expanding in many organisations, and along with this there is a higher requirement for downstream integration as SaaS is incorporated into enterprise business processes.
The ease of procurement and deployment of SaaS means that it often creeps into organisations via the back door, under the radar of IT. The research findings of Forrester and Gartner imply that this trend is diminishing, at least in the organisations they sampled. But this does not help the many organisations that are already awash with an unwieldy collection of ‘point’ SaaS apps, each with its own island of data – or the many organisations that will soon be following in their footsteps.
When the data integration specialist Informatica surveyed marketing executives on their SaaS use during 2010 it found increasing numbers of marketing leaders initiating their own IT projects using SaaS, and you can be sure that the marketing department is not the only culprit, because their reasons for taking the initiative are not unique. ‘They are driven by frustration with the time it takes for IT to do what seem like very easy tasks,’ suggests Mark Seager, VP of technology, Informatica, and they are emboldened by the knowledge that they have other options.
So how can affected organisations deal with the resulting problems of data management and governance? This depends on a number of factors, such as existing governance structures; levels of in-house IT expertise; understanding of the unique characteristics of SaaS and their impact on contracts, service level agreements, regulatory compliance, risk, vendor selection, and more; awareness of the options for integrating SaaS apps with each other and with on-premise apps.
As FSN detailed in a previous article, providers of SaaS apps have a tendency to overstate the ease with which you can integrate their products with each other and with on-premise apps. Such is the hype that you could be forgiven for supposing that as long as you can access the necessary API or connector, you are but a hop, skip and a jump away from integration. This is not so; it requires a certain amount of expertise (something the previous article looks at in more detail).
It is important to note that providers of SaaS apps are progressively making it much easier to integrate their offerings with each other an on-premise apps. ‘Some vendors have ramped up their professional services to provide best practices for success,’ says Herbert, and they are variously offering quick-start implementation packages, one-to-one consulting, and recommending integration partners that can bring development resources and business expertise to SaaS deployments (along with additional costs).
‘At the most basic level, it’s all about understanding what the traffic flows are,’ says Adrian Taylor, the chief technology officer with Data Integration (part of Xchanging). This is easy for him to say; after all, this is the area where he and his employer specialise. But for those who are not similarly blessed, even the tiniest data integration ‘project’ can be a lot more complicated than this simple statement suggests.
As well as understanding the traffic flows, getting integration between some or all of your islands of data could mean considering all of the following and more:
- Moving data between multiple SaaS systems;
- Moving data from legacy systems to online providers;
- Bi-directionally copying modified data between online environments and on-premises data repositories or warehouses;
- Replicating data in real time to allow applications living in the cloud and on the premises to access the same information;
- Ensuring the quality of information living in the cloud and on-premise systems so that it is consistent, standardised (in format and structure), not redundant, and meets any required governance guidelines;
- The bandwidth, the expertise and the tools that all of this requires.
Given that so many SaaS apps are deployed not by IT but by people whose expertise lies elsewhere, it’s also important to note that tools are emerging to enable the same non-techy people who selected, configured and are managing their own SaaS applications, to deal with the data integration – and almost as easily. SaaS-based data management tools are available from organisations including Adeptia and Boomi, and Cast Iron (which is part of IBM’s WebSphere unit), and are covered in more detail in another FSN article.
This type of service provides drag and drop tools and wizards that even non-tech people can use to connect applications together without needing to understand the underlying technology, create code, or get help from developers. Which could be very good news for a lot of organisations and individuals, because despite the research findings of Forrester and Gartner, and the tendency this implies towards building greater due diligence and governance into SaaS deployments, the need to retrofit appropriate data management seems unlikely to disappear any time soon.
