Runtime Governance for SOA and Cloud Computing

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XML Gateway Authors: Mamoon Yunus, Dirk Zwart, Rizwan Mallal, Mark O'Neill, Ron Schmelzer

Related Topics: Cloud Computing, Cloudonomics Journal, SaaS Journal

Article

Getting Your Head Around the SaaS Mindset

Why for SaaS success, mindset matters most

For SaaS Success, Mindset Matters Most
For organizations that are launching, building or in the market with SaaS offerings, success varies widely. Many of these organizations and the people in them have roots in the software, appliance or hardware product businesses.

To succeed as a SaaS provider, you have to build a great service, that's a given. But equally important, but you must transition from a product to a service mindset. If you have a product mindset in a service business, you will be blind to many of the issues that matter, and risk making poor organizational, strategic and tactical decisions.

What Is Mindset?
To understand Mindset, I use my OPFTM Mindset Framework:
In the OPF framework, Mindset is made up of three components: Orientation, Perspective, Focus.

  1. Orientation: My relationship and adjustment to the environment that I am in
  2. Perspective: My way of regarding/judging and interpreting facts
  3. Focus: Where I choose to concentrate my attention

Getting into the SaaS Mindset
Orientation
: We must shift our orientation from product to service. Products, even software products, are tangible things to be purchased, installed and used. Services are experienced. This fundamental shift ripples through everything else we need to do to succeed with SaaS. Maybe your product managers should change their titles to service managers. AOL, with their many flaws, had this right with their maniacal focus on "The Service." The words had almost a mystical quality and permeated their mindset and actions.

Perspective: We must shift our perspective from spikey to continuous. Products are built, shipped and sold as discreet widgets, which lead to release schedules, sales quotas and customer relationships that are "spikey" by their very nature. Services are always running (hopefully :), and always under evaluation and subject to churn. Customers make continuous buying decisions and their ongoing experience is what drives long-term value. With the recent April 2011 Amazon outage, the providers that understood this went the extra yard to be ready to drive continuous delivery despite Amazon's challenges. A great example of the right mindset driving the right investment.

Focus: We must change our focus from transaction to relationship. Great product companies have always understood this, good ones not always. There is no missing this continuous mindset with SaaS; it's a must have. In the enterprise software world, transaction is king. Large investments create economic, organizational and personal commitments to past decisions well beyond healthy levels.

Buyers love SaaS because it raises the bar on providers to deliver real service levels, and lowers both real and perceived switching costs. Providers that choose to compete for mature and enterprise customers need to raise their relationship game significantly.

How does your organization's mindset stack up for SaaS success? What action plan do you have to get a service orientation, perspective and focus to permeate from development to marketing to sales and support???

More Stories By Ken Rutsky

Ken Rutsky is a Product and Service Marketing Consultant, and has spent 20+ years in the industry, launching his first Internet services while at Netscape from 1995-99. Since then, he has been CMO at several start-ups and ran Network Security Marketing at McAfee. Ken launched McAfee's Secure Web Protection Service, and his time as a consultant has included the launch of Nimsoft's Nimsoft On Demand service. Today, he is laser-focused on helping ISVs and start-ups understand how to bridge from the world of products to SaaS Services with their mindset, organization and go-to-market tactics. Follow him on Twitter @jayrutz, on Linkedin at http://www.linkedin.com/in/kenrutsky, and on Facebook at http://www.facebook.com/home.php#!/pages/KJR-Associates/224894750772.