Organizations large and small are increasingly able to make use of service-oriented architecture (SOA) and Software as a Service (SaaS), employing a mix of in-house, on-premise, vendor-supplied and hosted on-demand applications and platforms to meet the need for fast, flexible application development and deployment, as Part 1 of this series illustrates.
These two related means of deploying Web services to end users aim to enable organizations to streamline business processes and manage the flow of information throughout their companies faster, more flexibly and more securely than ever before.
A Hybrid Approach
Organizations are beginning to turn to a mix of in-house, on-premise and third-party on-demand platforms such as SaaS to deploy applications. This is a hybrid model recommended by Forrester Research as a result of evaluating the Total Economic Impact of in-house vs. SaaS application and deployment options in organizations of different size and geographic footprint.
“It’s unlikely than an organization will strictly choose one path or the other when it comes to SaaS and software services that are built in-house. Every organization will likely continue to have a mix of existing applications, SaaS subscriptions, and now through SOA, a collection of reusable components, Web services and business processes,” commented Sandy Carter, vice president for SOA and WebSphere strategy, channels and marketing at IBM.
Making application services and business processes available throughout an organization and to business partners through proven best practices extends the value of SOA, Carter added. “This sharing of services also provides an additional level of consistency across an organization. Again, this shared knowledge, reuse of services and consistency are key tenets to both an SOA strategy and the SaaS model.”
SOA in the House
Benefits of SOA often touted include faster and simplified deployment and maintenance, and the ability to make use of proven, standardized sets of software code and reuse them, along with the advent of higher level, more end user friendly application scripting and application development tools.
Integration middleware based on open standards, such as IBM’s WebSphere, play a key role in enabling organizations to develop and deploy on-demand applications in-house.
“When it comes to the options and software tools that organizations have for building their own on-demand apps, many are turning to standards-based integration middleware like WebSphere because it enables a company to easily connect disparate applications and sources of information so that employees can focus on the task at hand and not be held up by the proverbial wall that’s created through proprietary applications,” Carter told CRM Buyer.
“From an economic and management point of view, a registry and repository is the best approach because it can track all of a company’s existing services and business processes and which groups or departments are using them most frequently. Some organizations also use this tracking of Web services for charge-back purposes,” Carter added.
Hand in Glove
The benefits of SOA are similar to those SaaS providers claim for their shared, multi-tenant Web application services platforms. This isn’t surprising, given that SaaS platform providers were among the first to make effective use of SOA.
Ease of use and manageability were the primary reasons survey respondents said they opted for SaaS as opposed to on-premise deployment, according to Springboard Research. Low maintenance costs, quick and easy deployment, lower cost of ownership and scalability also featured prominently in their decision calculus.
The more enthusiastic adopters of the on-demand model among vertical industry lines include high-tech businesses, financial services, healthcare and business services (human resource, recruiting firms and legal services), education and the nonprofit sector, Bhoorender Panwar, Springboard Research’s manager of business development, told CRM Buyer.
“In general, companies are attempting to decrease the customization of packaged applications that they’re buying to lower the multiplier of services-to-software from about 5-to-1 down to around 2-to-1. Large companies do still customize often, but small to midsize businesses — and even departments within larger organizations — are driving demand for off-the-shelf offerings,” Eric Meerschaert, vice president of global marketing at Sterling Commerce, told CRM Buyer.
The recent news regarding the intentions of Google and Sun Microsystems to move ahead with plans to further develop and distribute the latter’s StarOffice suite is indicative of the momentum building up behind the use of networked, on-demand applications. SaaS is proving to be a potent driving force for their adoption.
CRM is the most widely used application in the SaaS market, both in the Asia-Pacific market and globally, accounting for some 45 percent of total SaaS revenues in the region, according to Springboard Research. Also popular are desktop office applications, such as word processors and spreadsheets, e-mail, security/compliance, human resource, payroll and workforce management applications.
CRM lends itself well to SaaS for a number of reasons. “CRM is a leading functional application because what’s important in CRM is salespeople using the process, not the uniqueness of the process itself. It’s important to have a full view of customers, but it’s not important how you have the view,” Sterling Commerce’s Meerschaert commented.
“Many companies find that on-premise CRM applications require too much technical expertise and too many IT resources to implement and maintain. With SaaS CRM solutions, companies benefit from quick implementation time, flexibility, ease of use and low cost,” he added.
More than 32,200 customers are now making use of Salesforce.com’s CRM on-demand application suite, but CRM is by no means the only category of applications popular with SaaS customers, according to Kendall Collins, the company’s senior vice president of marketing.
“While CRM seems to be the application that captured the industry’s attention, we continue to see further innovation including deployments in HR, financial services and public sector arenas. We fundamentally believe that the ‘End of Software’ is upon us,” Collins told CRM Buyer.
Where SOA and SaaS Meet
Salesforce.com has greater aspirations for itself than being an SaaS provider, and SOA provides the architectural framework through which it believes it can realize its goals.
“Our vision doesn’t stop with CRM suite. We believe that any application can — and will — be delivered on-demand. We’re no longer just delivering Software as a Service. We’re delivering the world’s first multi-tenant, on-demand platform — what we call ‘platform-as-a-service.’ This platform provides everything necessary to deliver any application on-demand,” Collins noted.
Salesforce.com recently released the Salesforce Platform Edition and Salesforce SOA, both of which are instrumental for the company by extending and expanding its relationships with customers.
Salesforce Platform Edition provides a complete set of features that enables organizations to build their own on-demand applications — including models and objects for managing data, a workflow engine for managing collaboration between users, a user interface model for developing forms and the Salesforce API.
Salesforce SOA enables organizations “to mash-up Salesforce.com’s multi-tenant on-demand service with enterprise workflow and business processes, enabling new kinds of enterprise applications on-demand,” Collins explained.
Using Salesforce SOA developers can make use of Apex Code to build a range of rich, SOA-based Web application services, such as billing, inventory and order entry systems, and integrate them within an overarching systems architecture, according to Collins.
Its integration capabilities include making call-outs to internal Web services such as Oracle Financials and SAP Order Management Order Management, as well as external Web services such as FedEx, Hoovers and Yahoo.
Taking advantage of its recent releases, “customers can now expand the success that they have found with our applications, including highly complex applications such as enterprise resource planning and inventory, highly transactional applications for those used in e-commerce, and highly intelligent applications such as those for yield management and financial services,” Collins said.