As businesses rethink the way they operate in the wake of the global pandemic, we’re seeing a huge shift in companies moving towards SaaS-based offerings. Gartner now forecasts that this global market will grow 35% in just two years.
That increase has been driven by necessity in the short term (following a massive growth in remote working) but it was always a long-term trend. SaaS provides so many benefits on both the customer and vendor side that it is just a matter of time before companies make the switch.
From the customer perspective, it removes a need to host servers, conduct maintenance, manage upgrades, etc. And switching is easy. They don’t have any big upfront costs – they can just sign-up, start using the product, and pay for what they need. This is simplifying IT infrastructures and helping to control costs.
Vendors can also realise huge efficiencies by taking advantage of cloud native technologies, such as microservice architectures that will allow them to spin up new infrastructure in an instant. This is allowing vendors to embrace more agile ways of working and bring features to market much faster.
Despite the size of the movement to SaaS, most independent software vendors (ISVs) are still to embrace this approach. This is especially true where vendors are serving established industries – where a cloud-based model is likely to be disruptive.
If companies don’t adapt, however, they will start to see their market share eroded by cloud-based companies who are better able to adapt to customers’ evolving needs. This is currently the case in banking, where you have Fintech companies like Monzo who can roll out new customer features in a month – while it might take the traditional high street banks a year to follow suit.
It is inevitable, therefore, that if organisations want to succeed in the long-term, they will need to embrace a SaaS-based approach sooner rather than later. There is no reason why vendors can’t start planning this transition today as there are just five steps that businesses can take to prepare for this change.
1. Build a Business Case
The first crucial step is to carefully plan out what their new cloud-based infrastructure will look like. This will require an understanding of what tech is going to be needed, and how this can be scaled and optimised to deliver a high-performing product. It’s likely that when both the costs and the savings have been calculated, companies will be left with a compelling business case that will give them the confidence to move forward.
2. Create Product Vision
As the shift to a cloud-based approach can disrupt the status quo, and involve cultural changes, a change management program will also be needed. If this transition is to go ahead smoothly, it will be crucial that key people buy into the new product vision. The leadership team, and all those affected, will need to be brought on board.
3. Minimum Viable Product
Before diving straight in and creating a new SaaS product, you will want to develop a minimum viable product (MVP). This is where a cloud consultancy can provide hands-on support to spin up test environments. Steamhaus has created Foundations for AWS to support customers wanting to accelerate the deployment of just this type of digital transformation project.
This service is designed to ensure companies follow best practice, based on AWS’ six Well-Architected pillars: operational excellence, security, reliability, performance efficiency, cost optimisation, and sustainability.
4. Full Product Development and Launch
With the foundations laid, businesses can then move forward confidently and develop a bespoke product tailored to their customer’s needs. It will be important to test the product before launch. Within a cloud environment, product testing can be largely automated.
5. Ongoing Support
After building a SaaS product in the cloud, vendors will want to monitor in order to optimise the infrastructure. Rather than opting for a traditional ‘break-fix’ maintenance model, organisations building products in the cloud will want to be proactive.
With cloud environments evolving quickly and new technologies being constantly released, this approach will ensure that infrastructure is continuously improving – so the product performs faster and cost-effectively.