John Clough heads up BDO Stoy Hayward business solutions consultancy. It’s a relatively small unit and focuses heavily on Access Accounts implementations. I’ve been trying to persuade John about the client value of the SaaS game through responses to questions elsewhere and through email. We finally managed to hook up and did a trawl through the industry – as you do in an industry where the badges may change but the names remain largely the same. 
I don’t know whether I helped John forward in his thinking but the central argument I made was:
- SaaS accounting (as opposed to the simple office style services like FreshBooks) is no different to any other implementation – you’ve still got to train people and delight the client. But with SaaS, you avoid the infrastructure migraine that comes with on-premise applications
- Most SaaS offerings are in early stage development. They don’t have the depth of functionality that on-premise apps do, but then do clients, especially SMBs, need all that superfluous goo?
- Watch for SaaS vendors who offer open standards APIs. These are the ones who will provide the platform for add-ons that will be easier to maintain because the API owner will always have to ensure that internal functional changes don’t screw up the API.
- Check out Ruby on Rails as a fast track development environment. VB developers should have little trouble picking it up and it provides a clean way to develop those pieces of vertical market functionality that not only deliver value but which can be readily incorporated into new client solutions. Heck if a semi geeky boy like me can pick up Ruby – anyone can!
- Think about open source additions. SugarCRM and Compiere come to mind. Think how they might be incorporated into projects. John didn’t know but in the US, BDO Seldman recently acquired 9,000 Sugar licenses.
And that in conclusion, the SaaS model provides the consulting practice with a way of extricating itself from the endless market>pitch>sales cycle dark cloud that hovers over many consulting organisations and which, in my opinion, contributes heavily to the bloated sales crews inside the vendor community.
What I didn’t say:
- As we go forward, SaaS vendors will develop very close co-development ties to their channel partner ecosystems be they consultants, accounting firms or what will be left of the traditional resellers of today. The models for making this work have yet to be established. The command and control models best exemplified by Sage and to a certain extent by Access itself, will no longer work, except for those on-premise sales that remain.
- Expect to see mid-market offerings that are sufficiently robust to compete with on-premise apps – InterpriseSuite looks interesting.
- Individual sales values go down not up as services proliferate. The £5 a month service today could well end up as £1 in years to come but the margin will be close to 100%. Customers will be be highly vocal in this regard as they see how powerful media such as this can be.
- Co-creation will be the order of the day as outlined by CK Prahalad but where clients become self-sufficent, requiring support to polish add-ons for which they instigate development. We’re maybe 5 years away from that state of grace (a half-lifetime in IT) but hey, it was 5 years ago I was in New York as part of a panel discussing collaboration that included Gartner and other heavy hitters. We’re in the first wave of seeing that vision play out.
- Expect smaller practices to jump into this game because it will add value at every level of the portfolio
- The time is now, not in a year or two’s time because the opportunities are here right now.
