Tag Archives: Cloud

Private Cloud: Benefits but Not a Free Lunch

As a result of ongoing discussions with IT managers and providers, Saugatuck has identified the increasing popularity of Private Clouds particularly among large enterprise IT organizations. In a recently published Strategic Perspective, Saugatuck offers guidance to any Enterprise IT organization considering a Private Cloud. Assessments are provided for areas of comparison between Private Clouds and infrastructure virtualization.

Saugatuck characterizes two basic factors to that make Private Cloud attractive to typical enterprise IT organizations: Continue reading

Cloud and Mobile Shape a New Vision of Innovation

Recent surveys have shown the increasing importance of Cloud and Mobile technologies in fostering innovation. While these exist within a cluster of mutually supporting technologies, such as Analytics, APIs, and an overall Digital Business context, they deserve a closer look as platform components for a new vision of innovation.

As the need for innovation becomes increasingly acute, and the profitability window continues to shrink, businesses need to look beyond idea sources to the processes supporting innovation and new product development. Cloud and Mobile technologies can play an important supporting role in energizing the traditional gated innovation process. These changes can make innovation more efficient and more effective, bringing some of the simplicity and rapid response that we have seen in Agile software development to the critical process of developing next generation products and services. Continue reading

Managing Complexity in the Cloud: DevOps + Non-Functional Testing

What is Happening?          

Complexity in the Cloud is growing significantly beyond simple hybrids of Cloud-to-Cloud or Cloud-to-On-Premises integrations. Cloud integration and loosely-coupled systems can create management challenges, particularly in an era of continuous deployment. As Figure 1 illustrates, interfaces to business processes and external APIs proliferate, new challenges arise for IT security, quality assurance and for IT management.

Figure 1: The Growing Challenges of Cloud Complexity

Cloud Complexity

source: Austrian Science Fund FWF

Moreover, as complexity increases, so does risk, particularly in two areas: One, security breaches; and Two, systems failure or degradation of performance – both potentially costly and undesirable outcomes, but both manageable by a pair of emergent approaches: a strong DevOps regimen, and “non-functional” testing techniques. Continue reading

IBM Needs to Learn the “Other” Software Business

A recent IBM briefing for Saugatuck helped to clarify the breadth and depth of IBM’s Cloud / SaaS portfolio, business strategy, approach, and results. We came away with two key net takeaways:

I.         IBM certainly has a broad, deep, useful, and valuable SaaS portfolio. Almost quietly, it’s long-standing positioning as a provider of software, but not applications, has shifted. Mostly through SaaS acquisitions, IBM today is a very significant and competitive business applications provider. One big example: the $1.3 billion acquisition of HCM / Talent Management SaaS provider Kenexa in 2012 (see Forbes article).

According to our recent briefing, IBM’s SaaS portfolio now includes over 120 busienss applications – across a range of functional roles (e.g., customer service, finance, human resources, marketing, procurement, sales) and solution categories (e.g., advanced analytics, BPaaS, Smarter Cities, Watson). By our estimates, IBM is already realizing more than $1B in annual revenues from this portfolio, and we expect Big Blue to at least double their current SaaS revenues within the next 18 months as this portfolio continues to grow (by acquisition and internal development) reach 150-200 by YE2015.

II.         But given the acquired nature of much of that portfolio, IBM still faces substantial needs for, and challenges in, organization, coordination, integration, and go-to-market approaches for the assembled Continue reading

SAP Concur Acquisition Illustrates the New Digital Business Enterprise Model 

SAP has agreed to acquire Cloud-based travel and expense management provider Concur Technologies.  When completed, the deal will be the most expensive acquisition ever for SAP, ranking above SAP’s 2010 $7.1 billion acquisition of Sybase Inc. It will also be a Top 10 all-time software or Cloud / SaaS acquisition in terms of total price paid. Concur shareholders will receive $129 per share, a 20 percent premium over Wednesday’s closing price of $107.80. The 21-year-old, Bellevue, WA-based Concur had been known to be shopping for a buyer, with most rumors indicating SAP or Oracle as the most likely acquirers. The publicly-traded firm posted fiscal-year 2013 losses of $24.4 million on revenue of $546 million.

Saugatuck’s first take is that, while buying Concur may not improve bottom-line profits immediately, SAP does get another significant stream of Cloud-driven revenue; Cloud-based providers’ revenues are growing increasingly faster than traditional software providers. SAP also adds more Cloud expertise and presence overall, especially expertise in marketing and supporting Cloud-based financial software. With 23,000 clients and 25 million users through 150 countries, SAP also gains a business transaction network similar to its 2012 acquisition of Ariba. According to SAP CEO Bill McDermott, the addition of Concur would mean Continue reading

SuccessConnect 2014: View to the Future of Digital Business

What is Happening?

At the SuccessConnect event in Las Vegas this week, Saugatuck was able to speak with more than a dozen customer attendees along with key executives from SuccessFactors and SAP, including SFSF co-founder and CTO Aaron Au, Chief Marketing Officer / SAP Cloud and Line of Business Tim Minahan, and Sven Denecken, Global VP Cloud Solutions and Co-Innovation at SAP.

Throughout all of our conversations, three key threads emerged regarding Cloud, HR solutions and strategy, and SAP itself as follows:

  • Concerns: We found it fascinating that none of our customer conversations touched on Cloud concerns – including security. No mentions were made about data security and privacy in the Cloud. Instead, discussions tended to focus on the specific, tactical concerns relative to any new software deployments, namely integration, data migration, and time to completion. This is another powerful sign that the “Cloud experiment” truly is over.
  • Strategy and Modularity: We found no one with an actual “Cloud strategy” in regards to their Cloud procurement approach. Instead, businesses are building on, enhancing and extending business processes and management with a variety of solutions. In our conversations there was no hint of a broad enterprise movement toward Cloud-based solutions exclusively. Consistent with the broader Cloud HCM segment, many customers are retaining existing systems in certain areas such Learning, Payroll, or Performance Management, while others are using the modularity to extend their on-premises core HR solutions with additional SuccessFactors Modules like Recruiting, Talent Management, and Workforce Analytics. All indications are that current SFSF customers are planning on embracing fully hybrid deployments in their HR systems, and that while complex integrations are far from being a solved problem, SFSF’s implementation partners and 3rd party integration vendors like Dell Boomi, and Informatica are able to make the complexity manageable.
  • Maturity: Our conversations with customers here at SuccessConnect, and with enterprise IT and LOB leaders globally, continue to indicate that, while nowhere near its final form and capabilities, Cloud has matured enough that its perceived and real risks are equivalent to those of most other mainstream forms of IT. That means that Cloud can be acquired and managed as would most other forms of Business IT, even as it enables and catalyzes business transformations.

In short, we’re learning to manage Cloud as it should be – a key Business IT component and catalyst. Next, and soon, we must learn to manage business change, as our Business IT continues to transform. Continue reading

Call for More Nominations: Saugatuck’s Beacon Awards for Business Innovation

What firms do you know that have innovated, improved themselves, and profited from Digital Business initiatives? Tell us about them, so we can tell the world about them through the 2014 Beacon Awards for business innovation.

Every year, the Beacon Awards recognize user enterprises that have re-thought, re-invented, or built new businesses, created new opportunities, or reshaped the future of their company, their markets, and their customer/partner ecosystems through the innovative use of Cloud and other digital technologies.

Past winners have implemented creative mobility strategies that improve customer engagement, cultivated new software development approaches that improve business operations, and developed software+services that productize internal operations into industry-beneficial solutions.

Now through September 30, 2014, you can nominate your firm, your customers, or your partners. Click HERE for more information and for details on how to submit a nomination.

Nominations must be submitted via email to Continue reading

Intimate Connection: Cloud and Digital Business

The intimate connection between the Cloud and Digital Business was the subject of a recent column / blog post by Forbes.com contributor, Joe McKendrick, in a recently published post entitled Are Digital Business And Cloud Computing Joined At The Hip? No discussion could be more timely.

This has been a rather tumultuous decade for IT. The Cloud has been even more dramatically disruptive than the minicomputer, PC, client / server or early years of the World-Wide Web, and several leading Master Brands, including Hewlett-Packard, IBM and Microsoft (among others) are still reeling from the impact.

On the buy side of technology, too, this continuing transformation is in process of remaking business models and industries, creating opportunities and destroying comfortable franchises. Enterprises large, small and in between are hurrying to find their place in this new business environment that leverages digital technologies on the foundation of still-new Cloud, Mobile, Social and Analytics platforms.

Saugatuck Technology has covered the Cloud since its earliest manifestations in 2004 and has ten years of survey data from technology buyers and providers that Continue reading

Three Reasons to Leave Your Cloud Provider

In a relationship with a Cloud provider – just as in a personal relationship – the relative importance of functions and services delivered by the provider can vary dramatically from customer to customer or even from user to user within the same customer. In a recently published Strategic Perspective, Saugatuck proposes that the most efficient and effective methodology for a customer to evaluate a relationship with a Cloud provider is to focus on whether (and, how well) the Cloud provider is fulfilling expectations in the following three areas: Continue reading

Security is Transformed by Cloud, Big Data and Intelligence

The crowd says Cloud is less secure and holds more risk than enterprise networks. But try to convince the principals at Target of this, and you’ll be told that nothing is secure anymore, unless you turn it off. Unlike the conventional wisdom of the crowd, Saugatuck sees the Cloud as the path through which the entire field of information security is going to become transformed into more control and less risk.

The age of big data security analytics is in its childhood, but this child is growing fast and strong and will soon carry the entire industry on its shoulders as it transforms current practices and technologies. The primary constraint to its growth is the necessary skills to interpret and use the new generation of big data security analytic tools. This key restraint will be overcome by Cloud-enabled application services and the massive pools of information these analytic applications will ingest from around the world. Continue reading