SaaS - Is it a transitional term?
It gives me great pleasure to introduce Ashish Birla who has joined us as a Lead Consultant in Infrastructure and Service Management transformation practice. He brings with him more than 13 years of rich and extensive experience in the field of IT Infrastructure and Service Management transformation, with many Fortune 500 clients in US and India. And now without further ado, his blog - SaaS, is it a transitional term?
Ever wondered if SaaS (Software as a Service), is a transitional term. You will be pardoned for raising an eyebrow, since it’s a “term” which has entered in the IT arena very recently, and I am talking about it becoming obsolete already.Well, let’s talk about other “Services”. What terminology are you likely to use, “Transportation” or “Transportation as a Service”; “Hospitality” or “Hospitality as a Service”; “Consulting” or “Consulting as a Service”? As soon as you as you answer this question, you probably have understood why “SaaS” is a transitional term.
Let’s step back a little and analyze what usually transpires for a service to be born or developed. Acceptance of a “service” in a particular area is inversely proportional to affordability or desire to “own” a product. That’s true, a lot of us, see service as “loss of control” over something that you used to own.
Let’s take an example. Although using a public transport is economical from money and carbon foot-print perspective. In a public transport, you don’t have control over the temperature that is maintained inside or where it stops or its schedule or your seat. This leads to owning your affordable mode of transport so you can control most of these constraints. However, can you apply the same principles to Airline or Hospitality services? Probably not, since for most people “owning” the infrastructure would be out of question.
Services also face other challenge vis-à-vis products. While an inventory of products can be maintained for the “season” of anticipated demand, same does not hold true in case of services. Services need to be supplied synchronously when they are demand.
As you begin to manage or remove the constraints, the product becomes a candidate to be offered as a service.
Inferring ITIL® definition of Service, a customer is looking to buy a “solution” and not necessarily a fancy “product” with great features, while many of its features are at best underutilized if not unutilized. Services would mean that you pay for what features you want to use. For example, a customer really wants printing service and not necessarily a fancy printer full of non-essential features in its office. Similarly think about an organization which has begun to offer “carpeting service” instead of making their customers own their carpets. This addresses environmental issues also to a big extent, as carpets owned by customers would end up in landfills after their life where it may take up to thousands of years for it to degrade, while carpeting services would mean the customers get the finest carpeting experience without having to worry about buying-replacing their carpets.
Customers being able to buy “services” would mean that they no longer have to worry about huge capital costs associated with buying a product and can switch to another solution once the current one is no longer able to serve their requirements. This will foster competition. Competition fosters innovation.
Service Providers apart from specializing into a particular set of services, will also be able to offer “economies of scale” hence driving down the costs further.
In not-so-distant-future, Software will not be a product anymore, will mandatorily be offered as a “service” and hence SaaS would become a redundant term. SaaS would be the way of life rather than exception that it is made out to be today. We have seen a spurt in number of software now being offered as service in recent times. Organizations known as Product companies are coming forward with software being offered as service. This trend will continue to grow, not just because it gives a cost advantage over traditional software as a product, but it genuinely reduces headaches (or TCO to be precise) of maintaining it.
Coming to IT Service Management, few years back who would have thought ITSM Tools can be offered as a service, but they are a reality now. More than that ITSM SaaS tools are “the future” of ITSM Tools. Since ITSM itself promotes IT as a service, which is why SaaS becomes more relevant when it comes to ITSM Tools. Refer to Shraddha Tilloo’s Blog for more food for thought.
