Who Cares about Software as a Service?

"... business leaders will need to rethink governance models and management processes to take full advantage of new technology trends."

--McKinsey & Company

The Summer 2006 edition of The McKinsey Quarterly (subscription required) offers a web exclusive, "Two New Tools that CIOs Want" by authors Kishore Kanakamedala, Vasantha Krishnakanthan, and Roger P. Roberts.

The two new tools: virtualization and software as services.

The article ends by saying that if these technologies are truly going to deliver the goods, then top management will have to get on board. My own view is that top management -- as well as other stakeholders -- may very well not get on board without a marketing campaign to lead them. And who better to conduct a marketing campaign than marketing?

Why should marketing care? Because in a service-based, plug-and-play world, the enterprise does not end at the front gate. Web services are how trading partners interoperate -- or soon will. They are hooks into your customers.

I am currently working with a large telecommunications company that is migrating to a web services platform for conducting business-to-business transactions like pricing an offer bundle or tracking a repair order. Say, you're an office manager at a Fortune 100 company and you want to find out the status of something. In the past, you would have had to pick up the phone and wait in a service queue and then wait again while the customer rep pulled up your data on the screen ... and so on. Then when you finally did get the information, you would still have to put it someplace to make it useful -- like into one of your firm's own applications. And that assumes that your applications know what to do with the data once it's there.

With web services, whatever information is in the telecom company's systems can be used by applications at the telecom's customers. In addition, basic functions can also be pulled into the customers' applications -- like "calculate a price" or "track a service request." Effectively the customers' applications become an extension of the telecom company's application (and vice versa) -- but each company gets to keep its preferred look and feel -- and its own brand.

What I'm working on is a Flash presentation to sell this -- first to internal audiences at the telecom company and then to external customers. People have to "get it" before they sign on. For one thing, internal stakeholders have to be willing to expose their business processes -- and that by itself may require senior management leadership.

McKinsey is right. The latest technology trends have enormous implications about how people and businesses will work together. My point is that marketing -- as the traditional bridge builder -- needs to find its role.