The Wave of Tomorrow: Feature Poor, ROI Rich: On-Demand SOA finds it niche

Add comment June 1st, 2006 David Bush - Iasta

As referenced in a recent article in Supply and Demand Chain Magazine entitled “Feature Rich, ROI Poor” , a recent Butler Study found that at least half of enterprise application functionality licensed by organizations is not used. Moreover, a significant portion of the unused code was customized, unnecessarily prolonging upgrade cycles and increasing cost.

Besides pointing out that an organization should truly understand what it needs before selecting a solution so it doesn’t pay for more then what it needs, it points out a clear benefit of on-demand SOA (Service Oriented Architecture) solutions - your business can acquire only what you need, when you need it, keep your maintenance and technology costs down, and grow your solution base incrementally and intelligently. This is one of the many reasons why On-Demand solutions typically cost significantly less then traditional enterprise applications.

What does this tell us? The obvious answer is that organizations should understand what they truly need before selecting a solution so they don’t pay for more then what they need. But this is only part of the answer. The full answer is that business need to focus on what will provide them the greatest value and only acquire more technology when the incremental value covers the cost.

This is one of the benefits of On-Demand SOA solutions – business can acquire only what they need, keep their maintenance and technology costs down, and grow their solution incrementally and intelligently.

On-Demand, or SaaS, which offers higher quality solutions (typically multiple updates per year compared to one, or none, for major installed enterprise systems) at lower cost (usually by a factor of 5 to 10) that can be deployed rapidly (typically 50% to 90% faster) is here to stay and is in the process of revolutionizing the eSourcing industry – and it’s nice not to be one of the few voices in the crowd who realizes it with new articles coming out almost weekly about the benefits.

In this very well crafted post, Tim Minahan, formerly of Aberdeen Group points out that On-Demand, which is not just a technology issue, delivers, and that it is very unlikely that a software provider can support both traditional and on-demand models, something that we at Iasta have believed since the very beginning, and the reason why we built our software as on-demand from the beginning.

Entry Filed under: Analysts/Research, Functionality, General, Technology / SaaS, e-Sourcing Marketplace