I am currently on site at AMR’s Supply Chain Executive Conference, and I sat in on an extraordinary session called “Supply Chain in a Cloud.” The presentation was sponsored by Ariba and presented by AMR heavies, Mickey North Rizza and Dennis Gaughan. I have plenty to say about the research results and the light that AMR is beginning to shed on the migratory patterns of companies from enterprise applications to “the cloud.” Before launching too heavily into that I want to call out a phrase that was really cemented during Ariba President Kevin Costello’s introduction. Costello spoke of this migration as a “Saasification” of business solutions. (rhymes with “classification,” let it soak in…) I have heard this vernacular thrown around and I have even heard of business becoming “SaaSy,” but I think the discussion that rose up from today’s presenters and audience really put their finger on the pulse of this new concept.
What Ariba calls a commerce cloud and Mickey North Rizza further identified as the walls of the enterprise becoming blurred really is a “migration” or a “SaaSification.” Presently not all enterprises are on this journey, but one gets the feeling that most companies are at least talking about it. Over half of companies reviewed for the research reported that some aspect of their enterprise was on a public cloud. (46% use a hybrid solution) Yes, this was where the discussion of security began and continued throughout the rest of the presentation. IT and those that empathise with the plight of IT have been consistent in their claim that SaaS commerce opens the door to more risk. Unfortunately, Gaughan did confess that that inflated risk may only be conjecture at this point as there is no compelling data to point to more incidence of risk post SaaS implementations. The risk boogie man is an external person that hacks into the enterprise and performs any series of costly or disruptive actions. In reality, risk and fraud more often come from employees, customers or suppliers. An argument can still be made that these exposures are equally present in SaaS or non-SaaS environments.
Discussions about risk aside, people are curious about becoming SaaSy. There is too much to gain not to at least be curious. The research suggests that implementation times are actually less than the expectations that enterprise apps have taught us to expect. I was taking fast notes, but I gathered that 33% of companies that are considering a SaaS solutions expect ROI in the first 9 months whereas 60% of companies currently implementing a SaaS solution expect ROI in the same period. Increased ROI; Costs reduction; faster time to productivity; Reduced Implementation and more frequent upgrades are among the top reasons that people are beginning to dream about the cloud. Although these benefits were not without detractors. One insightful voice brought up that auto-upgrades, although the promise less costs and constant cutting edge technology to the client are also disruptive in that than can easily tweak the work flow that has been adapted to support the new SaaS model.
The conversation was well presented and invited well-thought and free flowing commentary from the audience. The mark of a great presentation, in my opinion, is one that turns the audience into the expert. I suppose the socialization of information is what we are really talking about anyway. The walls being blurred. Businesses lock arms with their Supplier community. In this model, if we play this out a little more, ultimately the supply chain becomes part the enterprise. Eventually commerce itself becomes the enterprise. It is something to think about anyway.
I digress a bit, but being part of discussion like this points back to the overwhelming need for Lavante’s supplier information management (SIM) SaaS tools. Like most things, the SaaS model will only be as strong as the quality of the data inhabiting it.