Research: SaaS 2011
SaaS Adoption Soars, Yet Deployment Concerns Linger
Forget the Tea Party—software as a service is the real revolution. In our InformationWeek Analytics 2010 SaaS report, we called for CIOs to filter through the cloud computing hype and develop a realistic plan to incorporate SaaS. There’s just no reason enterprise IT teams should be bogged down delivering commodity services, and the outsourced option should be on the table whenever a new IT-driven capability is requested by the business.
In our 2010 poll, 47% of respondents were using SaaS. What a difference a year makes. We surveyed 275 business technology professionals, all of whom are involved in their companies’ enterprise applications strategies, for our InformationWeek Analytics 2011 SaaS Survey and found that today, 60% are using applications in the cloud, up 13 points in 11 months—one of the biggest adoption jumps we’ve seen for any technology category in such a short period.
Deployments are still not trouble free. More respondents express concerns over features and functionality. Those citing opex savings as a key decision driver went up three points, making us wonder about these companies’ budget processes. And, in our 2011 survey, 26% rate the applications currently delivered as services as mission-critical to the organization, down from 34%.
What’s not down is the number of SaaS providers taking on giants like Microsoft, Google and Salesforce.com. In our survey, when we asked about SaaS vendors in use, in addition to our list, we got more than 60 write-ins across just about every functional IT area. For smaller companies, such a rich applications landscape was the stuff of dreams just a few years ago.
"Our staff now spends time producing content rather than building and maintaining sites, software and equipment,” says one IT manager for a group of radio stations. “Cost is reduced, content is dramatically increased since they have more time to create it, and quality is universal at multiple locations and facilities. I will be looking for other ways to use SaaS for accounting, billing and business functions.”
While in our practice we’ve seen significant reliability and security strides made over the past year, this organization is still maintaining in-house backups of critical content, a smart move. Problems also remain around integrating outsourced applications into internal IT architectures, and it’s an open question whether SaaS vendors operating on thin margins can keep customers happy. (R2010311)
Survey Name: InformationWeek Analytics 2011 SaaS Survey
Survey Date: October 2010
Region: North America
Number of Respondents: 275
Table of Contents
5 Author’s Bio
6 Executive Summary
8 Research Synopsis
9 Be Careful What You Wish For
10 What Is SaaS?
14 SaaS Express
21 Not Off the Hook
25 Is Your App a Commodity?
27 Vendor Landscape
31 SaaS Mobile
34 Good Vibrations
37 Appendix
43 Related Reports
9 Figure 1: Using SaaS
11 Figure 2: Reasons for Not Using SaaS
12 Figure 3: SaaS Decision Drivers
13 Figure 4: Length of SaaS Use
14 Figure 5: Primary SaaS Proponent
15 Figure 6: Applications Delivered as a Service
16 Figure 7: Applications Delivered as a Service: 2010 vs. 2009
17 Figure 8: Long-Term SaaS Plans
18 Figure 9: SaaS Performance
19 Figure 10: Importance of SaaS-Delivered Apps
20 Figure 11: Integration of SaaS Applications With Internal Applications
21 Figure 12: Managing SaaS Performance
22 Figure 13: SaaS Security
23 Figure 14: SaaS Auditability and Compliance Features
24 Figure 15: SaaS Data Ownership and Intellectual Property
25 Figure 16: Customization of SaaS Applications
26 Figure 17: Customization for SaaS vs. Traditional Software
27 Figure 18: Features & Capabilities: Custom SaaS vs. Traditional Apps
28 Figure 19: SaaS Application Deployment vs. Traditional Software
29 Figure 20: SaaS Vendors in Use
30 Figure 21: Support for SaaS
31 Figure 22: SaaS Expectations Met?
32 Figure 23: Barriers to Broader SaaS Use
33 Figure 24: SaaS Configuration
37 Figure 25: Involvement with Enterprise Applications
38 Figure 26: Primary Involvement With SaaS
39 Figure 27: Company Revenue
40 Figure 28: Company Size
41 Figure 29: Job Title
42 Figure 30: Industry
About the Author
Michael Biddick is CEO of Fusion PPT and an InformationWeek Analytics contributor. He has worked with hundreds of government and telecommunications service providers in the development of operational management solutions. Most recently he has supported the Department of Homeland Security and the U.S. Department of Defense in the deployment of ITIL-based processes that are utilized to make their organizations more transparent and cost effective. Certified in several ITIL life cycle service areas, Michael is also able to leverage over a decade of operational tool design and implementation experience with service desks, network management systems and consolidated management portals in making enterprise architecture decisions.
Prior to joining Fusion PPT, Michael spent 10 years with a boutique consulting firm and Booz Allen Hamilton, developing enterprise management solutions for a wide variety of both government and commercial clients. He previously served on the academic staff of the University of Wisconsin Law School as the director of information technology.
Michael earned a Master of Science from Johns Hopkins University and a dual bachelor's degree in political science and history from the University of Wisconsin-Madison. As a contributing technology editor to InformationWeek and Network Computing, he has authored more than 50 articles, including reports on cloud computing, government IT strategies, SaaS and IT process improvement.
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