Delivering Software as a Service to Manufacturing Companies

Content

• Datamonitor View
• Catalyst
• Summary
  • Key Messages
  • A Reliance upon Configuration as Opposed to Customization Is A Defining Feature of Saas
  • Datamonitor Believes The Manufacturing Industry Is Ready for Saas
  • The Impact of Saas on Staff Is Hard to Determine but Should Be Carefully Considered
  • Deciding When and Whether to Invest in Saas Can Be Difficult
  • There Is Not Significant Variation between Different Manufacturing Sectors
  • Table of Figures
  • Market Opportunity
  • Saas Delivery Models Are Defined by Four Key Characteristics
  • A Reliance upon Configuration as Opposed to Customization Is A Defining Feature of Saas
  • Understanding The Difference between The Sme and Enterprise Markets Is Critical
  • There Are A Range of Business Pressures Driving Saas Investment
  • IT Departments Are Trying to Reduce Technology Implementation times
  • Upgrades and Maintenance Are Becoming Increasingly Complex and Costly
  • IT Budget Pressures Are Compounding with Many Expected to Remain Flat in 2007-2008
  • Manufacturers Are Looking to Gain Access to Additional Functionality and Process Support
  • Integrating Processes with Business Partners Is A Trend That Continues to Emerge
  • Manufacturers Are Asking for Better Service Levels from Their IT Departments
  • There Still Remain Significant Inhibitors to The Saas Market
  • Service Levels Remain The Biggest Concern for Manufacturers Looking to Invest in Saas Technology
  • Manufacturers Still Put A Large Focus on The Security of Saas Solutions
  • A Loss of Control by The Manufacturing Company Is Still Seen as A Hurdle
  • Regulatory Concerns Prove Important for Some Manufacturers
  • A Large Portion of Companies Have Already Invested in on-Site Technology
  • The Location of The Service Provider Also Affects A Saas Investment Decision
  • A Potential Backlash from The Loss of Internal Staff Is Seen as The Least Important Issue
  • A Lack of Configuration Options Is Stopping Some Manufacturers from Adopting Saas
  • Datamonitor Believes The Manufacturing Industry Is Ready for Saas
  • Customer Impact: Saas in Manufacturing
  • Manufacturers Believe Saas Can Deliver Several Benefits to Their Businesses
  • Upgrading and Access to The Latest Functionality Prove to Be The Biggest Draw Card for Saas
  • Access to Expertise from The Saas Supplier Is Also Ranked Highly as A Benefit for Manufacturers
  • Manufacturers Believe They Have A Better Control over Service Levels via Saas
  • A Lower Cost Profile Is One of The More Common Benefits Associated with Saas
  • Costs Are Spread over Time as Opposed to An Upfront License Fee Easing Budget Constraints
  • Saas Delivered Technology Can Support A Range of Business Processes
  • Organizational Units Focused on Customers and Hrm Are Investing in Saas
  • Plan Processes Provide A Medium Level of Opportunity for Saas Vendors and Manufacturers
  • There Is Some Scope for Saas within Source Processes
  • Manufacturers and Vendors Will See Significantly Less Opportunity within Make Processes
  • Datamonitor Believes Deliver Processes Should Be A Low Priority for Saas
  • Areas Such as Warranty Management Provide Some Opportunity for Saas within Return Processes
  • There Is A Significant Opportunity for Saas to Support A Wider Range of Processes within Smes
  • The Impact of Saas on Staff Is Hard to Determine but Should Be Carefully Considered
  • Deciding When and Whether to Invest in Saas Can Be Difficult
  • as Always, Only Invest in Technology When There Is A Business Problem, but Think outside The Box
  • Manufacturers Should Consider Non-Core Processes for Saas First
  • Smes Should Take A Look at Their Current Business and Assess Where They Want to Be
  • A Lack of Configuration Could Be A Potential Deal Breaker
  • Go to Market
  • The Current Competitive Environment Is Somewhat Fragmented
  • There Are No Clear Leaders in The Saas Market
  • Different Vendors Carry Multiple Saas Product Lines
  • Vendor Strategy Varies Heavily between Different Technology Vendor Types and Key Markets
  • Infor
  • Oracle
  • Rightnow Technologies
  • Salesforce.Com
  • Sap
  • A Number of Factors Will Determine Successful Vendors
  • Vendors Should Adopt Different Strategies for The Sme and Enterprise Markets
  • Saas Solutions Should Lean towards The Full-Suite Business Model for The Sme Sector
  • Vendors Need to Be Approachable for Smes, Not A Faceless Corporation
  • Targeting The Right Person at Both Enterprise and Sme Companies Is Critical
  • There Is Not Significant Variation between Different Manufacturing Sectors
  • Vendors Should Focus on A Small Number of Key Selling Points
  • Lowering Tco and The Idea of Predictable Costs Will Generate Significant Traction
  • Green IT Credentials Should Be Pushed by Vendors More
  • Vendors Should Concentrate on Demonstrating Access to Latest Software Updates
  • Datamonitor Believes The Saas Market Will Have Evolved Significantly in 5 Years
  • Recommendations
  • Provide Saas Delivery to Applications in A Modular, Expanding Fashion
  • Vendors Need to Continue to Educate The Market More about Issues Such as Security
  • Configuration, Configuration, Configuration Should Be The Mantra of Saas Vendors
• Appendix
  • Definitions
  • Use Heading 3s, If Required, to Add Structure to Sections in The Appendix
  • Methodology
  • Further Reading
  • Ask The Analyst
  • Datamonitor Consulting
  • Disclaimer
• List of Figures
  • Figure 1: IT Budget Expectations for 2007-2008 within Manufacturing Companies
  • Figure 2: Perceived Inhibitors to Saas Adoption within Manufacturing Companies
  • Figure 3: Perceived Benefits to Saas Engagements within Manufacturing Companies
  • Figure 4: Relative Opportunities for Saas within Scor Process Groups
  • Figure 5: Industry Variation of Perceived Inhibitors to Saas Engagements