On-demand offers more than value
On-demand services can save customers money. However, other selling points are every bit as important, writes Bob Tarzey
When asking customers to spend their money, it goes without saying that it has to be justified. Even if VARs are supplying a commodity and customers know what they want, the purchase decision is often based on more than just the right price; convenience, brand name and service often come into play.
IT applications are one of the more complex propositions to get right. Closing a deal requires more than just having a good price for the software, hardware and services; it needs to be demonstrated that the proposed application will add real value to the business at an acceptable cost, without increasing risk. Quocirca research shows that on-site CRM deployments in particular often fail to live up to expectation.
These three things – controlling risk, adding value and reducing costs – all need to be built into proposals. This is especially true for on-demand services because on-demand services are not necessarily cheaper than on-premise implementations when viewed over the application lifecycle.
Making the case for reducing risk is not hard – it all hinges on good working practice. Many businesses go through the motions, convincing themselves that they are ready for a disaster. For example, they may backup their servers, but have never rehearsed a recovery. Come doomsday, it can actually be days before their systems are up and running again. Not so with an on-demand service. Service level agreements can specify minimum down time.
Business continuity is about more than just keeping IT running. For a business reliant on a single premise that contains both computers and people, a lack of access to the building means most activity stops dead. Users cannot easily relocate staff and plug them back into the applications they use if both were affected by the same disaster; but they could if the IT is located in a safe facility elsewhere and available as an on-demand service.
More reliable access to IT adds business value in its own right through higher availability, which in turn increases productivity. But there is also added value through flexible access to applications that can be provided by on-demand services. A good case can be made in two areas – flexible working and inter-organisational collaboration.
Many organisations recognise the benefits of flexible working practices. Linking mobile workers into IT while they are out in the field can make business processes more efficient and is a major driver for the take-up of mobility services. On-demand applications make it easier for organisations to implement flexible working as they are by their very nature easily enabled for remote access.
The same applies to inter-organisational collaboration. This is not in itself enabled by on-demand applications, but they can allow communities of interest to share information. The majority of businesses currently collaborate with third parties electronically – for example, sales-force automation applications that are accessible by all the parties in a sales channel. All this is easier to enable with on-demand applications that are easy to share.
VARs must be prepared for customer’s queries if they are about to extend their product portfolio and jump on the on-demand bandwagon. Remember, it is hard to justify on cost alone, but reducing risk and adding value can be as attractive as price in a well-crafted proposal.