InfoWorld TechWatch | InfoWorld | SaaS is still unable to deliver what the enterprise really needs - business processes that are competitive differentiators | November 9, 2005 03:09 PM | By E. Schwartz
Kagerman appears to reinforce a point I've been trying to make in my coverage of companies like Salesforce.com that offer software as a service [SaaS] solutions.
Salesforce and other SaaS-based companies offer meat and potatoes solutions for standard business operations. However, by using multi-tenant architecture which requires volumes of customers on a single instance of the database, it cannot give companies the kinds of differentiators they need to increase sales or gain market share.
Andy Mulholland, CTO at Capgemini calls it the 80-20 rule. SaaS does 80 percent of what every company needs. But that final 20 percent that sets a company apart from its competitors cannot be provided by SaaS technology.
I hear this (and even think it) from time to time. But it remains true that a huge chunk of what many businesses do is undifferentiated (and non-differentiating) from business to business and even industry to industry. Abusing the 80/20 rule even further, I'd guess that 80% of the processes inside most businesses could be served by an unmodified, one-size-fits-all solution, assuming the business could let go of their old ways of doing things (ie, change the people element of the process to match the technology).
No doubt Kagermann's right, but it's probably dangerously easy to overstate the number of business processes (broadly defined) that require the kind of customization (even if only to the "20%" level) he's talking about.
- Create quality products and services.
- Sell what you advertise.
- Make certain your products and services do what they claim to do.
- Fully test and study your products and services before offering them for sale.
- Disclose all risks posed to purchasers of your products and services.
- Tell the truth.
- Fulfill your warranty promises.
- Don't cut corners.
- Comply with all applicable laws and regulations.
- Don't try to buy influence.
A reasonably good start at what companies should worry about, rather than Forbes' fear-mongering. Fits in nicely with the thesis behind Douglas Rushkoff's forthcoming book Get Back in the Box, which he's sampling on his site:
That's when it hit me: What this fellow needed was not to hire companies who could market like craigslist but to be more like craigslist, himself. That is, simply understand what specific product or service he's really offering, and then do it as well and expertly as possible. That's not what he wanted to hear. No, he wanted a new marketing campaign to define his business for him, from the outside in.
Too many companies are obsessed with window dressing because they're reluctant, no, afraid, to look at whatever it is they really do and evaluate it from the inside out. When things are down, CEO's turn to consultants and marketers to rethink, rebrand or repackage whatever it is they are selling, when they should be getting back on the factory floor, into the stores, or out to the research labs where their product is actually made, sold, or conceived. Instead of making their communications less Saatchi and more Craig, they should be reinventing their core enterprise.
Sony's response to the whole rootkit fiasco has been anything but reassuring -- which is probably why they're facing a series of lawsuits about the matter. However, the folks over at Digg have highlighted what might be the single most ridiculous statement on the matter from a Sony executive during an NPR interview about the matter. After taking issue with anyone using the terms "spyware, malware or rootkit," Thomas Hesse, President of Sony's Global Digital Business, literally says: "Most people, I think, don't even know what a rootkit is, so why should they care about it?"
Couldn't make this stuff up even if I tried, people.