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​Are CIOs flipping for cloud SaaS?

​Are CIOs flipping for cloud SaaS?

CIOs must focus on adding valuable services to complement SaaS usage.

The ease of adoption of cloud software as a service (SaaS) is increasingly leading business-unit managers to make cloud buying decisions independently of one another and independently of any central authority.

That’s the view of Gartner vice president and distinguished analyst, Janelle Hill, who believes this approach reflects greater freedom of choice for these business units and may improve time to market.

However, it can seriously hamper combined value to the enterprise.

“Independent and uncoordinated journeys into cloud SaaS mean the goals, selection approach, initiation and ongoing implementation of services will be fragmented at best and siloed at worst,” Hill said.

“A coordinated, service-centric approach has the advantage of enabling multiple business units to benefit from joint decisions and shared support for all of the various SaaS solutions.”

For Hill, this is a transformation to a “very different world” for the CIO and the IT organisation.

“In this scenario, the focus of the CIO’s office flips from the issues associated with owning and providing technology-based solutions to adding valuable supporting services to complement the usage of SaaS,” Hill explained.

“The office of the CIO should focus on becoming a cloud brokerage, offering value-added capabilities, including help desk/support for cloud SaaS solutions, integration skills, and procurement and contract management skills for cloud usage.”

Consequently, Hill believes the area of help desk/support services, in particular, represents an opportunity for a centralised IT help centre to better partner with other shared-service teams (HR, travel and expense, procurement, accounting), as it’s not always obvious if the issue is technical or functional.

“This amounts to a shift from being a cost centre into a value centre relationship with the business,” Hill added.

“This shift will expand CIOs’ engagement with business leaders, enabling earlier participation in planning for strategic innovation and growth initiatives.”

Gartner estimates that by 2025, 55 per cent of large enterprises will successfully implement an all-in cloud SaaS strategy.

As a result, Hill believes CIOs should focus on the services that will make an immediate difference to business consumers adopting SaaS.

Overall, the worldwide public cloud services market is projected to grow 16.5 per cent in 2016 to total $US204 billion, up from $US175 billion in 2015.

Gartner findings show that the highest growth will come from cloud system infrastructure services (infrastructure as a service [IaaS]), which is projected to grow 38.4 per cent in 2016.

Meanwhile, cloud advertising, the largest segment of the global cloud services market, is expected to grow 13.6 per cent in 2016 to reach $US90.3 billion.

Specific to SaaS, this part of the market is forecast to grow 20.3 per cent in 2016, to $US37.7 billion.

“As software vendors shift their business models from on-premises licensed software to public cloud-based offerings, this trend will continue,” Gartner research director, Sid Nag, added.

In addition, the entry of some major software vendors into the public cloud last year will fuel growth of the SaaS market moving forward.

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