Much has been said about the potential of software-as-a-service (SaaS). And amid all the hype there are some compelling reasons why the channel should be taking a look.
Demand for flexible access to applications and the pressure to reduce server and energy use are increasing its appeal, especially for SMEs which like the pay-per-month pricing and the speed of implementation.
SaaS channel partners help vendors reach new markets and retain customers. But as SaaS has a different delivery model from traditional software, the role of the channel must change as well.
With SaaS, partners may not take title to the product or handle inventory or logistics. Channel partners may also experience changes in their role in contractual reselling activity, as well as in maintenance, upgrades and installation.
Partners are no longer resellers but service providers, helping customers understand their business needs and realise process improvements in areas such as sales, marketing, human resources, operations or logistics.
However, as much as things change, some things stay the same. Customers still need consultancy to integrate SaaS into their existing business processes.
The channel can add value by providing the strategy for the software implementation and helping customers make a seamless switch to the new systems.
The emphasis is not on the technical services but on change management and making sure customers have the right processes for long-term success.
SaaS means more chances to sell ongoing consultancy services and derive long-term customer loyalty with the associated annuity revenue.
Low upfront costs are key for business customers. It is likely that SaaS will continue to expand its reach - not just through SMEs but via large organisations as well.
Stephen Read is SME director at SAP
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