To modernise legacy software across multiple central government departments, the UK government has committed up to £366 million ($461 million) to upgrade key ERP, HR, and finance systems by transitioning them to the cloud. As reported by The Register, SAP has signed a £246 million ($310 million) agreement with His Majesty’s Customs & Revenue (HMRC)… Read more »
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ManageEngine, a division of Zoho Corporation and a leading provider of enterprise IT management solutions, has launched SaaS Manager Plus, a SaaS management solution for enterprises. SaaS Manager Plus integrates with Zoho apps and other widely utilised applications, empowering IT admins and finance managers to streamline their SaaS ecosystems and identify cost-saving opportunities for better… Read more »
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HCLSoftware, a provider of enterprise software solutions, has signed a Strategic Collaboration Agreement with AWS that will allow customers to consume the HCLSoftware portfolio as cloud native SaaS in AWS Marketplace simplifying their procurement and deployment process. With Cloud-native architectures leveraging Amazon Elastic Kubernetes Service, HCLSoftware portfolio can seamlessly integrate into customers’ existing cloud environments,… Read more »
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Inflation has dominated the financial news landscape in 2022. In many markets, the consumer price index (CPI), has reached its highest point in a generation. This growth in the cost of ‘things’ also applies to software. Almost every organisation has come to rely on SaaS to conduct business, from communications tools like Slack and Zoom… Read more »
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Oracle has reported its 2016 Q4 results stating growth over the period declined 1% to $10.6 billion, though its cloud business grew 49% to $859 million, reports Telecoms.com.
2016 has seen Oracle spend almost $2 billion on cloud-specific organizations, as the tech giant continues efforts to transform the Oracle business focus to the burgeoning cloud market. While Oracle could be seen as one of the industry’s elder statesmen, efforts in the M&A market are seemingly paying off as PaaS and SaaS continues to demonstrate healthy growth to compensate for the dwindling legacy business units. The team have also outlined plans to make strides in the IaaS market segment.
Growth in the SaaS and PaaS business has been accelerating in recent years as CEO Safra Catz quoted 20% growth in 2014, 34% in 2015, and now 52% over the course of FY 2016. Q4 gross margin for SaaS and PaaS was 57%, up from 40% during the same period. The progress of the business would appear to be making healthy progress, and Catz does not seem to be content with the current growth levels. The team have ambitions to raise gross margin to 80% in the mid-term, as well as seeing cloud year-on-year revenue growth for Q1 FY 2017 of 75% to 80%.
“For most companies as their business grows, the growth rates go down,” said Catz. “In our case, as the business grows, the growth rates are continuing to increase. Now, as regard to our cloud revenue accounting, we have reviewed it carefully and are completely confident that it is a 100% accurate and if anything slightly conservative.”
Moving forward, CTO Larry Ellison highlighted the team plan on driving rapid expansion of the cloud business. The Oracle team are targeting growth rates which would double that of competitors as its ambition is now to be the first SaaS company to make $10 billion in annual revenue. The team are not only targeting the customer experience markets, but also the Enterprise Resource Management and Human Capital Management segments, where it believes there will be higher growth rates.
“We’re a major player in ERP and HCM,” said Ellison. “We’re almost the only player in supply chain and manufacturing. We’re the number one player in marketing. We’re very competitive. We’re number one – tied for number one in service.”
Secondly, the team will also be aiming to facilitate growth through expanding it IaaS data centre focus, which is currently an ‘also ran’ part of the cloud business. Ellison claims Oracle is in a strong position to grow in this area, having invested heavily second generation data centres, as well the potential for the combination of PaaS and IaaS for the company’s installed base of database customers, helping them move to the cloud.
“And we built, again, the second generation data centre, which we think is highly competitive with anything out there lower cost, better performance, better security, better reliability than any of our competitors, and there’s huge demand for it, and we’re now starting to bring customers into that,” said Ellison. “We think that’s another very important driver to Oracle for overall growth.”
The last few years have seen a considerable transformation in the Oracle business, as it has invested considerably in the development of new technology, as well as acquisitions, seemingly hedging its bets to buy its way into the cloud market. The numbers quoted by Catz and Ellison indicate there has been some traction and the market does seem to be reacting positively to the new Oracle proposition.
In terms of the IaaS market, success in this area will remain to be seen. Although Oracle has the potential to put considerable weight behind any move in this market, it is going to be playing catch up with some noteworthy players, who have cash themselves. Whether Oracle has the ability to catch the likes of AWS, Microsoft Azure and Google, as well as the smaller players in the market, remains to be see, though its success in the SaaS and PaaS markets does show some promise.
Wipro and Xactly have launched a new partnership to offer sales performance management solutions to customers as a SaaS model.
The new partnership claims the new solutions will enable an organizations leadership team to bridge the gap between their business goals and sales performance. The sales performance management is estimated to be valued in the region of $715 million (2015) with both Wipro and Xactly believing the market still has healthy growth potential.
“Sales Performance Management is a key priority for organisations, across the board,” said Hiral Chandrana, SVP for Business Application Services at Wipro Limited. “Companies can optimise their sales performance processes through effective incentive compensation design for their employees and tools to measure the same. We are confident that Wipro’s extensive experience in transforming the front-office sales process coupled with Xactly’s incentive compensation cloud products will deliver the right platform to accelerate business outcomes for our clients.”
The Wipro and Xactly partnership will aim to combine software products, which focus on managing employee performance, monitoring margins, and mitigating risk, with Wipro’s consulting experience in transforming the sales functions, to improve the performance of customer’s employees.
“We are always looking to partner with like-minded industry leaders who understand the importance of using incentives to drive the right behaviors and are aiming to shape the next wave of this industry,” said Nitin Mathur, VP of Worldwide Professional Services at Xactly. “Wipro’s global reach and services expertise complements our mission of helping companies use compensation as a strategic lever to drive better sales alignment, retention, and performance.”
One of the key challenges for businesses when evaluating new technologies is understanding what a successful return on investment (ROI) looks like.
In its infancy, business benefits of the cloud-based Software-as-a-Service (SaaS) model were simple: save on expensive infrastructure, while remaining agile enough to scale up or down depending on demand. Yet as cloud-based tools become ubiquitous, both inside and outside of a workplace, measuring success extended beyond simple infrastructure savings.
In theory the ability to launch new projects in hours and replace high infrastructure costs with a low monthly subscription should deliver substantial ROI benefits. But what happens to that ROI when the IT team discovers, six months after deployment, that end-user adoption is as low as 10 per cent? If businesses calculated the real “cost per user” in these instances, the benefits promised by cloud would simply diminish. This is becoming a real issue for businesses that bought on the promise of scalability, or reduced infrastructure costs.
In reality, success demands real organisational change, not just a cheap licencing fee. That’s why IT buyers must take time to look beyond the basic “sticker price” and begin to understand the end-user.
Aiming for seamless collaboration
As the enterprise workplace becomes ever-more fragmented, a “collaborative approach” is becoming increasingly important to business leaders. Industry insight, experience and understanding are all things that can’t be easily replicated by the competition. Being able to easily share this knowledge across an entire organisation is an extremely valuable asset – especially when trying to win new customers. That said, in organisations where teams need to operate across multiple locations (be it in difference offices or different countries), this can be difficult to implement: collaboration becomes inefficient, content lost and confidential data exposed – harming reputation and reducing revenue opportunities.
Some cloud-based SaaS solutions are quite successful in driving collaboration, improving the agility of teams and the security of their content. For example, Baker Tilly International – a network of 157 independent accountancy and business advisory firms, with 27,000 employees across 133 counties –significantly improved efficiency and created more time to bid for new business by deploying a cloud-based collaboration platform with government-grade security. However, not all organisations experience this success when deploying new cloud technologies. Some burden themselves with services that promise big ROI through innovation, but struggle with employee adoption.
Here are the three key considerations all IT buyers must look at when evaluating successful SaaS deployment:
All enterprise systems, cloud or otherwise, need ownership and structure. IT teams need to understand how users and information move between internal systems. The minute workflows become broken, users will abandon the tool and default back to what has worked for them in the past. The result: poor user adoption and even increased security risks as users try to circumvent the new process. Building awareness and confidence in cloud technologies is the key to curbing this.
While cloud-based SaaS solutions are sold on their ease of use, end user education is paramount to ensuring an organization sees this value. The truth is, media scaremongering around data breaches has resulted in a fear of “the cloud”, causing many employees, especially those that don’t realise the consumer products they use are cloud-based, to resist using these tools in the workplace. In addition to teaching employees how to use services, IT teams must be able to alleviate employee concerns – baking change management into a deployment schedule.
These change management services aren’t often included within licensing costs, making the price-per-user seem artificially low. IT teams must be sure to factor in education efforts for driving user adoption and build an ROI not against price-per-user, but the actual cost-per-user.
There’s a thin line drawn between usability and security. If forced to choose, security must always come first. However, be aware that in the age of citizen IT too much unnecessary security can actually increase risk. That may seem contradictory but if usability is compromised too deeply, users will default to legacy tools, shadow IT or even avoid processes altogether.
Many businesses still struggle with the concept of their data being stored offsite. However, for some this mind-set is changing and the focus for successful SaaS implementations is enablement. In these businesses, IT buyers not only look for key security credentials – robust data hosting controls, application security features and secure mobile working – to meet required standards and compliance needs; but also quality user experience. The most secure platform in the world serves no purpose if employees don’t bother to use it.
Through clear communication and a well-thought out on-boarding plan for end users, businesses can ensure all employees are trained and adequately supported as they begin using the solution.
One of the key advantages of cloud-based software is its ability to scale quickly and drive business agility. Today, scale is not only a measure of infrastructure but also a measure of user readiness.
This requires SaaS vendors to respond quickly to a business’s growth by delivering all of the things that help increase user adoption including; adequate user training, managing new user on-boarding, and even monitoring usage data and feedback to deliver maximum value as business begin to scale.
Yes, SaaS removes the need for big upgrade costs but without support from a seasoned expert, poor user adoption puts ROI at risk.
SaaS is about service
Cloud-based SaaS solutions can deliver a flexible, efficient and reliable way to deploy software into an organisation, helping to deliver ROI through reduced deployment time and infrastructure savings. However, these business must never forget that the second “S” in SaaS stands for service, and that successful deployments require more than just a low “sticker price”.
Written by Neil Rylan, VP of Sales EMEA, Huddle
New findings from Synergy Research Group highlight Microsoft is growing healthily in the Software-as-a-Service (SaaS) market segment, but Salesforce is still market leader.
According to the research, Microsoft demonstrated the second highest level of growth within the segment at 70% year-on-year, only behind SAP who were at 73%, but still only sits second in the market share rankings. Salesforce was one of only four in the top ten for the segment who demonstrated less than 50% growth, however still accounts for just below 15% of the worldwide market share for SaaS. Adobe, IBM, Oracle, Google, ADP, Intuit and Workday complete the top ten.
“In many ways SaaS is a more mature market than other cloud markets like IaaS or PaaS,” said John Dinsdale, Chief Analyst at Synergy Research Group. “However, even for SaaS it is still early days in terms of market adoption. It is notable that the big three traditional software vendors – Microsoft, Oracle and IBM – are all now growing their SaaS revenues faster than the overall market and yet SaaS accounts for less than 8% of their total software revenues.”
The Software-as-a-Service has been demonstrating healthy growth over recent years, as Synergy estimates the market segment has grown by 40% over the last 12 months, and is expected to triple over the next five years. The growth claims are also supported by research from Cisco. Last year the team predicted by 2019 59% of total cloud workloads will be SaaS, compared to 45% in 2014.
The research also highlights Microsoft as making positive steps in the consumer SaaS market segment alongside its enterprise business. While the consumer segment is roughly a third of the size of the enterprise market, the company’s growth in this area exceeding competitors who currently have a more assured position in the space.
Microsoft says the latest incarnation of Dynamics AX will mark its transformation from a packaged application to a cloud service.
On Thursday the vendor announced the latest release of its flagship enterprise resource planning (ERP) system will be generally available in the first quarter of 2016. The main difference, it said, is that the ERP is now a service designed for the cloud.
A public preview of the new solution for customers and partners will be available in early December. The new name of the release, Microsoft Dynamics AX, reflects a departure from branding that reflected the year or the version of the product, a characteristic of software packages, it said. From now on the branding will underscore that Dynamics AX is a cloud-based service that will be regularly updated, it said.
Microsoft said it will also implement a new, simple and more transparent subscription pricing model to make it easier for companies to buy the system as they need it. Dynamics AX will offer a new user experience that looks and works like Microsoft Office and shares information between Dynamics AX, Dynamics CRM and Office 365, according to the vendor. It will also combine near-real-time analytics powered by Azure Machine Learning with the ability to visualise data through Power BI embedded in the application, in order to give users more predictive powers.
In response to usability analysis, Dynamics AX will have a browser-based HTML5 client and a new touch-enabled, modern user interface. Now that it’s a cloud system it will adopt the principles of highly visual applications more akin to consumer applications, according to Microsoft.
The classic rigidity of ERP systems has been replaced, according to Scott Guthrie, Microsoft Cloud and Enterprise’s executive VP. “Our ambition to build the intelligent cloud comes to life with apps optimised for modern business. When you combine the hyperscale, enterprise-grade and hybrid-cloud capabilities of Microsoft Azure with the real-time insights and intuitive user experience of Dynamics AX, organisations and individuals are empowered to transform their business operations,” said Guthrie.
Cloud technology is rapidly becoming the new normal, replacing traditional IT solutions. The revenues of top cloud service providers are doubling each year, at the start of a predicted period of sustained growth in cloud services. The private sector is leading this growth in workloads migrating to the cloud. Governments, however, are bringing up the rear, with under 5 percent of a given country’s public sector IT budget being dedicated to cloud spending. Once the public sector tackle the blockers that are preventing uptake, spending looks likely to rapidly increase.
The classic NIST definition of the Cloud specifies Software (SaaS), Platform (PaaS) and Infrastructure (IaaS) as the main Cloud services (see figure 1 below), where each is supplied via network access on a self-service, on-demand, one-to-many, scalable and metered basis, from a private (dedicated), community (group), public (multi-tenant) or hybrid (load balancing) Cloud data centre.
Figure 1: Customer Managed to Cloud Service Provider Managed: The Continuum of Cloud Services
The Continuum of Cloud Services
The benefits of the Cloud are real and evidenced, especially between the private and public cloud where public cloud economies of scale, demand diversification and multi-tenancy are estimated to drive down the costs of an equivalent private cloud by up to ninety percent.
Also equally real are the blockers to public sector cloud adoption, where studies consistently show that management of security risk is at the centre of practical, front-line worries about cloud take-up, and that removing them will be indispensable to unlocking the potential for growth. Demonstrating effective management of cloud security to and for all stakeholders is therefore central to cloud adoption by the public sector and a key driver of government cloud policy.
A number of governments have been at the forefront of developing an effective approach to cloud security management, especially the UK which has published a full suite of documentation covering the essentials. (A list of the UK government documentation – which serves as an accessible ‘how to’ for countries who do not want to reinvent this particular wheel – is set out in the Annex to our white paper, Seeding the Public Cloud: Part II – the UK’s approach as a pathfinder for other countries). The key elements for effective cloud security management have emerged as:
Data classification enables a cloud security framework to be developed and mapped to the different kinds of data. Here, the UK government has published a full set of cloud security principles, guidance and implementation dealing with the range of relevant issues from data in transit protection through to security of supply chain, personnel, service operations and consumer management. These cloud security principles have been taken up by the supplier community, and tier one providers like Amazon and Microsoft have published documentation based on them in order to assist UK public sector customers in making cloud service buying decisions consistently with the mandated requirements.
Data classification is the real key to unlocking the cloud. This allows organisations to categorise the data they possess by sensitivity and business impact in order to assess risk. The UK has recently moved to a three tier classification model (OFFICIAL → SECRET → TOP SECRET) and has indicated that the OFFICIAL category ‘covers up to ninety percent of public sector business’ like most policy development, service delivery, legal advice, personal data, contracts, statistics, case files, and administrative data. OFFICIAL data in the UK ‘must be secured against a threat model that is broadly similar to that faced by a large UK private company’ with levels of security controls that ‘are based on good, commercially available products in the same way that the best-run businesses manage their sensitive information’.
Compliance with the published security framework, in turn based on the data classification, can then be evidenced through procedures designed to assess and certify achievement of the cloud security standards. The UK’s cloud security guidance on standards references ISO 27001 as a standard to assess implementation of its cloud security principles. ISO 27001 sets out for managing information security certain control objectives and the controls themselves against which an organisation can be certified, audited and benchmarked. Organisations can request third party certification assurance and this certification can then be provided to the organisation’s customers. ISO 27001 certification is generally expected for approved providers of UK G-Cloud services.
Allowing the public sector cloud to achieve its potential will take a combination of comprehensive data classification, effective cloud security frameworks, and the pragmatic assurance provided by evidenced adherence to generally accepted international standards. These will remove the blockers on the public sector cloud, unlocking the clear benefits.
Written by Richard Kemp, Founder of Kemp IT Law