Information systems management practices and strategies

¶ … roles and responsibilities with the adoption of SaaS, do you think the role changes will be beneficial for businesses (large or small) or create additional problems in the future with this technology?

I think the role changes are going to revolutionize businesses and be very beneficial; they are going to serve as the catalyst for organizations becoming more customer-centric. I am reading Marc Benioff's book right now, Behind the Cloud: The Untold Story of How Salesforce.com, and as you are interested in this area I highly recommend it. Here is a link to a review:

http://blog.tmcnet.com/blog/rich-tehrani/crm/book-review-behind-the-cloud-by-marc-benioff-of-salesforcecom.html

The roles in organizations are already becoming much more integrated as the vision of collaboration as defined by Tim O'Reilly with Web 2.0 is starting to be seen in the product strategies of SaaS vendors including Salesforce.com. The fact that Chatter, which integrates Salesforce.com and Twitter was just announced at DreamForce 2009 in San Francisco last month bears this out.

SaaS has this ability to lessen resistance to change -- reading the Benioff book is worth it for the stories he has of this alone. It is quite remarkable who a community of users was formed based on their need to be more effective in their work, and older systems just got in the way. Also Benioff is very different than previous BPM gurus including Micheal Hammer who proclaimed lean process improvement even if it means trimming headcount. Benioff is more focused on how to grow an organization through effectiveness and centricism on the customer. So SaaS brings the voice of the customer into organizations that rely on this platform for CRM especially. I hope this answers your question. Please see below for the security discussion.

Information Systems Management

Executive Summary

The economics of computing and information technologies is going through a fundamental transformation where users, not centralized IT departments and Chief Information Officers (CIOs), are in control. This transformation has occurred due to Software-as-a-Service (SaaS) applications being hosted on virtualized servers which can scale and deliver the computing power orders of magnitude above what was possible on previous generation server-bound technologies (Carr, 2005). Server virtualization is acting as the catalyst of SaaS platform growth, which has created single- and multi-tenancy delivery options (Tehrani, 2006). Of these two approaches, multi-tenancy, where a single instance or installation of a Web-based application can be used by thousands of users simultaneously, is redefining the enterprise software market in general and specifically in Customer Relationship Management (CRM) with Salesforce.com (Tehrani, 2006). SaaS-based application development based on Ajax programming which significantly increases the responsiveness of application performance within Internet browsers (Serrano, Aroztegi, 2007) and the widespread adoption of XML as an integration standard (Young, 2009) are leading to the fulfillment of Web 2.0 design objectives (O'Reilly, 2006). All of these technologies taken together on an increasingly stabilizing SaaS platform are also leading to social networking applications becoming the most dominant of all applications used online today (Bernoff, Li, 2008). Please see the Appendices for an analysis of Web 2.0 technologies and social networking applications.

Forecast of SaaS Adoption and Growth

In assessing the five-year forecast for Software-as-a-Service application growth the factors of open source adoption (Campbell-Kelly, 2008), growth and trust in multi-tenancy of enterprise applications including CRM (Tehrani, 2006), rapid advances in virtualization (Carr, 2005) and increased performance of Ajax-based programming standards (Serrano, Aroztegi, 2007) all combined to define an aggregate growth model. There is also the underlying dynamics of XML as a pervasive integration standard (Young, 2009) and the market development effects of Web 2.0 technologies (O'Reilly, 2006) and social networking (Bernoff, Li, 2008). Countering the growth projections is the economic recession which positions the market for -1% revenue growth in 2010 rebounding in 2001.

Figure 1: Software-as-a-Service Revenue Growth & Forecast (2009 -- 2014)

Revenue $ Million

Growth %

2010

145,723.6

-1.0

2011

151,552.5

4.0

2012

157,766.1

4.1

2013

164,234.6

4.1

2014

170,968.2

4.1

Implications of SaaS Adoption & Growth for Business & Organizational Models

As the economics of information technologies is being reordered due to the exceptionally fast growth of SaaS-based development platforms and applications the implications for businesses and organizations is strategic. Most fundamentally is the availability of enterprise-level applications which can be paid for using Operating Expense (OPEX) accounting principles, no longer requiring Capital Equipment expenditures, sometimes called CAPEX. This has taken the power of information technologies and applications out of the hands of the CIO and given it to the line-of-business managers and leaders. The dynamics of how CRM has shifted from the CIO to the Sales Vice Presidents and Chief Marketing Officers (Tehrani, 2006) is a case in point. Secondarily the multi-tenancy of the platform (Tehrani, 2006) and the scalability of the Ajax application language is also fundamentally reordering application development as well (Serrano, Aroztegi, 2007). As a result of the combining of all these factors, businesses and organizations are capable of creating knowledge networks. This has served to significantly reduce the lag time for knowledge transfers globally and also created entirely new Ajax-based applications that can manage and analyze exceptionally large and complex data sets (Serrano, Aroztegi, 2007). The net effect of all these developments is that SaaS-based applications are creating integration-based intelligence across entire value chains, making knowledge, not necessarily products, the competitive differentiator. For businesses and organizations this is a highly significant shift and one that needs their attention over time.