Rule One: Think Before You Clone
Reviewing some of the latest SaaS products, and announcements of some “real soon now,” I’m struck by one constant theme: The first impulse of ISVs with existing, premise-based products is to clone those applications and “stick them in the cloud.” To me – this should be the first indication of possible failure.
The web – or the cloud as we say now – offers many new opportunities. So, why not step back and rethink the application, the process it embodies, even the users it embraces – in the context of the Internet? Certainly, the user’s computer and their knowledge of it was considered in the original product. That’s why we have hardware, OS, and application specifications. We haven’t entirely eliminated those contexts on the web, but we have certainly lessened their importance.
A good example was mentioned today by Ben Kepes of Could Ave. His article was about partnering strategies, which is an important consideration for SaaS companies, but I felt it also exposed a greater issue. An established accounting software vendor develops an online product. They have traditionally partnered with accountants. They built their locally-installed, licensed version from an accountant’s point of view for desktop installation. They cloned that application in a SaaS format and plan to use accountants as partners to sell it to SMBs.
In my opinion – this is a waste of good product development money. There are so many opportunities in the “cloud” to change the paradigm in the case of SMB accounting software it should keep them busy for ages:
- What if there where two versions – a “Pro” version for accountants, and an “SMB” version for their customers?
- What if the accountants could include the SMB subscription in their contracts with their customers?
- What if the clients could share their data with their accountant in the context of the web?
- What if the SMB version stopped looking like a dumbed-down approach to double entry accounting and turned the corner to provide a more user-based process?
- What if the same data could be seen in the accountant’s context in his version and he could see all his accounts, answer questions, do analysis as required – without asking for complicated data dumps?
- What if the data could be downloaded in smart samples that accountants could use to build spreadsheets from?
- The list goes on ad infinitum or ad nauseam …
My point is when you consider a product for the web, even a product that has an existing customer base, it is very important to step back and ask some serious questions. Mural Ventures has a good write up on their SaaS Camp blog, “Software-as-a-Service: the danger of not knowing what you don’t know” – definitely worth a read.
And in that context – one more thought: The marketable features of cloud-based products includes a lot more than process and user-end automation. Security, reliability, storage, – all those back end pieces need to be put out front and discussed as value against the risks and costs that the end user bears in premise-based products. Don’t sweep it under the rug and hope nobody asks. Solve the problems and market the capabilities.
