About two months ago, I contacted a number of CIOs from large firms about their recent SaaS (Software as a Service) implementations. One of the things I heard from several of these executives was that they would implement more SaaS products only when SaaS vendors develop more applications. Why? These software buyers want an integrated suite of products and not have a bunch of best of breed SaaS applications that the customer must integrate.
Integration in the SaaS world is different than what one finds in the on-premise world.
Technologies from firms like Boomi, Pervasive and others make integration very easy. Just last week, in a conference call I had with Tenrox (a PSA (professional services automation) SaaS provider), I was pleasantly surprised at the number of out-of-the box integrations Tenrox has with leading ERP solutions.
But, customers will do what customers are wont to do. They will buy suites and the larger the suite, the greater the market appeal. So, in the SaaS world, like the on-premise world, we can expect more customers moving to vendors with larger, pre-integrated suites.
Case in point: Workday has released its Workday 10 solution. Now, their SaaS solution includes a number of talent management applications (e.g., recruitment and succession planning) to its core HRMS solution. Interestingly, just weeks before this announcement, one Workday customer expressed this exact functional need (i.e., integrated Talent Management and HRMS) to me. That customer wanted to move more of their application business to Workday and get out of the best of breed business.
Big SaaS suites will benefit at the expense of standalone applications…