My $0.02 on SaaS Max Effgen, August 31, 2009 It has been clear for awhile that a major shift has been happening in enterprise computing. It has taken time to gain traction and momentum, but it looks like Software as a Service (SaaS) is nearly there. Companies will look to adopt SaaS solutions for 2 major reasons: Lower costs Implement quickly Cost structures are killing IT departments. The old enterprise paradigm just does not scale anymore. No huge capital investments. No new major hardware. No new major software. That also means that any SaaS purchase has to be “instant on.” No more hiring a Big 5 firm to take 6-12 months to roll out basic functionality. Early adoption of SaaS has been in the CRM space, notably with Salesforce.com. There is a reason that Sales and Marketing were targeted first. These two organizations have the most dynamic processes in the company. They need to be able to react quickly. IT departments are not typically scaled to move so fast with fluid processes. A SaaS company comes in wiht a pitch of I can take this problem away from you and IT will likely bite. Just think about the personalities that are in Sales versus IT. At the end of the day though, SaaS providers need expertise. Do not expect a company like Salesforce.com to build out an enormous services organization. They are more likely to partner with providers of process consulting, training and integration for particular verticals and foreign markets. Note that this is not technical consulting. The focus will be on the process and how to get there. Finally, expect that Sales, Marketing and in general CRM will lead future innovation in SaaS. Simply, CRM got there first. That’s my $0.02. cloud cloudCRMenterpriseSaaSsalesforce.comthoughts