SaaS Blogs

About a week ago I wrote an article on SaaS strategies for existing ISVs, and I see that a a parallel conversation emerged starting with a post by Anshu Sharma that claimed that in the real world, ISVs “…adopt a range of delivery model options to fit the customers need and economics of their particular business.” Phil Wainewright followed up with this post, where he vented about Sharma’s position.

I wanted to post a couple of notes on this little blog battle. First, I think the problem with Sharma’s approach is that it’s strictly customer centric. I’m the first to agree that there are (and rightfully so) a multitude of strategies (as I mentioned in my prior post), but that the decision of which to choose should be a combination of what your customer base wants/needs and what aligns with your company’s future goals and anticipated market shifts. That said, your customer might say “I want on-premise”, but you see that the market is quickly changing, with early adopters going for some new delivery model (SaaS) and its probably only a matter of time before the mainstream market (your current customers) buy into it. If you were to listen only to the customer base, you’d find yourself in trouble in the near future.

If you dig through Wainewright’s post, you’ll notice that he does agree with multiple strategies when it comes to transitioning to SaaS. This is the position I take. None of the strategies I mentioned in my above referenced post are to be permanant. Rather, their purpose is to help an existing ISV make a strategic shift toward adopting SaaS. If Sharma’s intent was that adopting a wide range of delivery models should be/can be permanant, I disagree. That’s asking for trouble when it comes to scaling the business, building new efficiencies, and having a cohesive mission.

Bob Warfield jumped into the battle with this post, where he ends on a note of a “protected game preserve” which is basically a market defined by specific attributes (size of company, etc.) where you are free to play as a SaaS provider, insulating you from the dangers of a head first mentality. This is a smart approach, and is virtually identical to my concept of pursuing a “lite” version of your product that targets a degraded demographic, giving you an opportunity to “sandbox” SaaS while you figure things out.

What do you think? Is it healthy for ISVs to pursue permanent mixed delivery models, or does this create a “dysfunctional family”?