Software Pulse

Business Strategy for Software Executives

July 28, 2008

Bill McNee

SaaS: A Blue-Chip Enterprise Solution?

A new study looks at the experiences of corporate SaaS adopters and finds satisfied customers who are looking for more enterprise-ready features.

By Bill McNee, Bruce Guptill and Mike West, Saugatuck Technology

Already entering its third wave, Software-as-a-Service (SaaS) is now spreading throughout the enterprise, delivering mission-critical solutions well beyond the basic software functionality of first-wave SaaS offerings. In just a few short years, SaaS has evolved from simple subscription-based application solutions at the margins – email, web conferencing, and CRM -- to offering core application solutions such as HR, Finance, BI and Procurement, as well as IT infrastructure solutions delivered as cloud-based services.  In this sense, SaaS has been steadily moving from the edges to the core, and in another few years will increasingly bring ERP, Supply Chain and GRC solutions to the enterprise.

But is SaaS truly “enterprise ready”? There are two sides to this question. The first concerns the evolution and maturity of a SaaS solutions and the platform that delivers it – as well as the underlying value proposition being provided. The second concerns how the buyer or user organization manages its SaaS solutions, and whether it adopts SaaS solutions on an ad hoc basis or takes a more proactive (managed) posture toward including SaaS within its application portfolio and application architecture.

This article highlights some of the key findings and conclusions from Saugatuck’s latest 42-page research report, Enterprise-Ready, or Not: SaaS Enters the Mainstream published July 10, 2008 – which focuses on whether SaaS is now ready to participate as a blue chip solution in the business portfolio.


New Podcast: Innovative Software Partnerships

M.R. Rangaswami of Sand Hill Group moderates an insightful discussion on how software companies can get the most out of software partnerships with Bob Langer, President of Qliktech Americas and David van Toor, SVP and General Manager of Sage CRM solutions. Click here to listen.

CIOs are the Last to Know

Billy MarshallA recent study found cloud computing low on the list of CIO priorities. Not to worry: Billy Marshall of rPath says technology leaders are often the last to hear about the adoption of new technology. Read why in this post to the Blog on cloud computing.

Publish Your Perspective! wants your opinions. Send your thoughts on the enterprise software industry to editor, Maryann Jones Thompson ( and have your opinions published on our site.

DON'T MISS: China's Opportunity in Offshore Services

China faces major challenges to becoming a global giant in the offshoring and outsourcing of services. Read more about the obstacles in this article from The McKinsey Quarterly.

News Update: Feeling Good About
“Plan B”

Microsoft feels bold amidst reorg; plus, Cisco feels right at home and there’s a new kid on the block, and more software news of the week. Read these stories and more software news of the week in the latest Software News Summary.

Poll: Enteprise Ready SaaS

Is SaaS ready for the enterprise?
Take our Pulse Poll >>

Last week, readers gave us their opinion on how serious mobile apps will threaten the enterprise?
Give us your opinion and see the results >>

More at

How CIOs are dealing with a tough economy.
Read the most important enterprise software industry news of the week >>

iYogi received $9.5 million from SAP-led VCs.
Monitor the latest software venture capital deals >>

IBM announced plans to acquire ILOG.
Size up last week's software M&A deals >>

Jim Groff named Chief Executive Officer of PBwiki.
See who's made it to the top in our list of recent software executive appointments.

Send us your feedback on this newsletter and the site.

Parting Thought

A computer lets you make more mistakes faster than any invention in human history - with the possible exceptions of handguns and tequila.
— Mitch Ratcliffe

Courtesy of Malcolm Kusher, The Kushner Group



rPath is the company that is pioneering the software appliance approach for application distribution and management. Just as the rise in availability and performance of the Internet gave birth to Software as a Service, so too will virtualization give birth to software appliances as a preferred form factor for application consumption. Software appliances eliminate the hassles of the general purpose operating system and free vendors and customers to focus on application value instead of technology management.
Find out more.


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