The worldwide market for SaaS is expected to grow from US$18.2 billion in 2012 to US$45.6 billion in 2017. To gain an understanding of how organizations approach SaaS, the IBM Center for Applied Insights conducted a global study of 879 IT and line-of-business (LOB) SaaS decision-makers.
Reducing the total cost of ownership of their applications was the top reason given for adopting SaaS. Forty-one percent reported achieving that goal to a high degree. Unexpectedly though, a greater number — 47 percent — are using SaaS to attain a broad range of powerful benefits that combine to deliver something even more significant: competitive advantage.
Although that may seem surprising, it’s remarkably consistent with earlier research conducted by IBM that examined pacesetting organizations reporting competitive advantage gained through cloud computing — infrastructure- or platform- or software-as-a-service. These leading organizations were outperforming peers and achieving better business outcomes from their cloud initiatives.
More recently, when we looked specifically at organizations deploying SaaS, a similar finding emerged. We grouped organizations based on their level of SaaS adoption and competitive advantage. Pacesetters are the 19% of respondents that report the highest level of SaaS adoption and say they’re gaining competitive advantage through their broad SaaS efforts. At the low end, Chasers are much slower to adopt SaaS and gain competitive advantage from it.
The Pacesetters leverage SaaS in powerful and even transformative ways. They start by taking a different approach to planning and implementing their initiatives. Notably, they cultivate a strong collaboration between LOB and IT on SaaS activities such as selection, deployment, and security.
A strong strategy is another significant differentiator of the Pacesetters’ approach to SaaS: Compared to Chasers, more than twice as many Pacesetters have a cohesive, enterprise-wide SaaS strategy (71% versus 31%), and Pacesetters are four times more likely to position SaaS as an integral part of their enterprise cloud strategy.
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