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Key Lessons Learned: Navigating from Traditional ISV to SaaS
Provider
Document:
STR-357
Perspective Summary: Now that Software-as-a-Service (SaaS) is considered by many IT buyers as “enterprise grade,” hundreds of established ISVs are faced with strategic decisions that could determine the future of their company: Should we develop a SaaS-based solution? If so, when? And what are the key “lessons learned” that we can take from others who have already made the transition? Saugatuck research indicates that decisions by independent software vendors (ISVs) to invest in a move to SaaS offerings should not be approached any differently than any other strategic business investment. Most important is that ISVs understand clearly what the new business opportunity is that they are addressing. For example: Is it a new geography or industry; is it a new software offering or a line extension; or is it a complementary business service that would enable customers to perform more efficiently and effectively? Any such transition will affect every aspect of the ISV, and will require development of – and most likely, partnerships for – new competencies and capabilities. Our research indicates that the technical elements of the transition are the easiest, and that the changes required in five other areas of the company are much deeper and – if not executed properly – entail much more risk. These five areas are:
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