January 18, 2008
Cloud Computing/SaaS
For me the most interesting section comes when Simon includes thoughts from Mark Ryan: He suggested a typical range of 3-5% of turnover amongst his own clients. However, Mark was quick to point out that he tends only to work with firms who consider their IT systems to be strategic, so are likely to be spending more than less pro-active firms…. Simon also provides some useful background on how you can use outsourcing as a way of mitigating investment costs: In addition to spreading the costs over the life of the service contract thereby avoiding a substantial upfront cost, Bhimjiyani pointed out that if the user chooses to rent, rather than buy the equipment, there may well also be a tax benefit. Perhaps more important than the question of initial finance, he went on to emphasise how using an external service provider could save an organisation from having to invest in additional IT expertise of their own, and ensure that existing staff were able to concentrate on their ‘real’ jobs rather than being dragged in to deal with IT problems. It’s a reasonable proposition but where I think Simon’s analysis is weak is in the breakdown of costs compared to the benefits across direct (buy) versus indirect (rent/on-demand) investment. Outsourcing seeks to deal with a range of cost issues such as hardware investment, maintenance and management along with commodity processes…. Each form of investment needs to be examined separately but compared over the life cycle of the project, and not simply from the initial investment…. In on-demand models, the hardware element is reduced to zero in many cases – or close to zero – subject to networking infrastructure to support internet computing.
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January 18, 2008
Cloud Computing/SaaS
CODA is blogging its progress towards having a financial application built on the Force.com (Salesforce.com) platform offered by Salesforce.com…. I spoke with Dave Turner, CODA marketing director, about this the other day and he said they’re hoping to put as much into the open as they can. This is a great idea because it means they can start to think how they’ll build the essential community around this project…. I know what some will say – if they’re in talks about being acquired by Agresso then doesn’t that event have the potential to kill this project?… It helps of course that Marc Benioff, CEO of Salesforce.com has just started a 20 city tour talking about cloud computing…. Dan’s take: All roads lead to the cloud (formerly known as “on demandâ€), and Benioff is trying to herd developers into his cloud with the evolving Force.com platform. Another colleague, Phil Wainewright added: Force.com is distinctive, among those dozens that have so far emerged, in its focus on becoming the generic cloud computing development platform for the enterprise domain. Salesforce.com has gone out of its way to make the development experience something that enterprise class developers will be comfortable with.
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