Reality Check | Ephraim Schwartz » SaaS, not so fast

February 20, 2007 | Comments: (0)

SaaS, not so fast

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Software as a Service has its limitations in the enterprise, writes Ephraim Schwartz

Last week's column was an upbeat look at SaaS (software as a service from the point of view of companies that are currently deploying SaaS solutions. This week we'll take a different tack.

Last week, Jeffrey Falk, director of product development at The Members Group, characterized most ISVs who have a footprint in the enterprise and who are now offering a hybrid version of the SaaS model, as vendors with overly complex apps who are trying to unsuccessfully transform on-premise software to the SaaS model.

"A lot was bloatware, some with a half-baked Web client," Falk said.

The two vendors I spoke to this week see the situation in a different light. These companies recognize the limitations of SaaS and have, one might say, taken a more pragmatic approach to the hosted model.

Lombardi Software offers an on-premise BPM suite to the Fortune 3000. Although Lombardi launched a SaaS component called Blueprint to that suite last week, the CTO, Phil Gilbert, says it is "ludicrous" to think that full BPM and other enterprise applications will become Web 2.0 applications any time soon.

The Web services standards, the scalability, the performance, and the standardization across platforms like J2EE, .Net, WebSphere and a host of other SOA platforms, aren't there yet, Gilbert says.

"Standards are just getting to where CORBA was a decade ago," Gilbert tells me.

Blueprint is designed for collaboration during BPM's process discovery stage. It needn’t be integrated into legacy systems, nor does it require IT to deliver company data to the hosted model outside the firewall.

Having SaaS capabilities makes it easier for a company doing business process re-engineering to reach users, often a distributed team working on different systems, for part of the process. Lombardi's limited application of SaaS turns out to be the proper delivery mechanism for those roles and those functions.

But what about the many instances, especially in CRM, when what is needed is a single view of the customer? Much of that customer data resides in operational systems behind the firewall.

Nimaya was a consulting shop focused on integration back in 1998. In 2005 it recognized that this was the Achilles' heel of SaaS applications.

The only way for a hosted solution to get data from operational systems that are behind the firewall was to move data through the firewall to the SaaS database. Many companies are, and will remain, unwilling to do that. Plus, the more data you move to your SaaS solution, the more the SaaS provider charges for storage.

In 2006 Nimaya created the CustomerGrid platform and its ActionBridge software to offer a way around the problem for sales management. The CustomerGrid server behind the firewall gets data out in a transient
fashion. Extracting lots of different data from the operational systems, it executes a customer query on the server -- it also looks at data on a scheduled basis and runs it past a rules engine -- and then ships the results and the extracted data to the user in an XML package, says CEO John de Wit.

What you actually have is an EDM (enterprise data mashup).

Nimaya's ActionBridge can ship results to a SaaS interface such as Salesforce.com, an enterprise portal, or as a standalone application.

I think the point that both Lombardi Software and Nimaya make is that when you don't get religious about technology, you win. IT must operate under those ground rules, and IT should expect all of its vendors to do likewise.

Posted by Ephraim Schwartz on February 20, 2007 03:00 AM

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