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Microsoft comes out of the SaaS closet - slowly

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5th May 2008
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As SAP puts the brakes on its SaaS adventuring, Microsoft has crept a little bit further into the market with the general availability of Microsoft Dynamics CRM Online, its software as a service (SaaS) customer relationship management (CRM) offering. Well, we say “general availability” as it is if you speak English and live in North America. Or as Gartner Group put it- a “limited audience”.

Gartner takes a mixed view of the prospects for the new offering. On the plus side:

The ability to synchronise and integrate the Online products with other Microsoft assets, such as SharePoint and Outlook, as well as the ability to design business processes (for example, using Windows Workflow Designer) that exist across multiple applications, represents a strategic advantage.

On the minus side:

However, we believe this hybrid model will present challenges because it implicitly promises that an enterprise can migrate easily from SaaS to on-premises, whereas Microsoft will not maintain the same CRM software application code and data model for all offerings.

Furthermore, the audience for the next several quarters is limited to North America, and the system will be available only in the English language initially. These facts, plus the absence of an enterprise-class system, will further reduce the potential audience in Phase 1.

Microsoft's strategy of committing to partner-hosted Microsoft SaaS delivery and standard on-premises software will slow momentum for its SaaS offering. Microsoft continues to struggle with changes in product names and product focus, as well its efforts to match products to markets. This ongoing process of refining, adding and deleting product names and their functional components is confusing to the market.

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By waynec
08th May 2008 13:58

".....it implicitly promises that an enterprise can migrate easily from SaaS to on-premises, whereas Microsoft will not maintain the same CRM software application code and data model for all offerings."

Why is any of this a surprise?
My Company, as vendors of our own Saas modular CRM & related business application products, are constantly up against competitors who swear blind they have a similarly complete web based Saas offering and haven't: the poor customer only realises the legacy / network integration issues when they have committed to a vendor and realises as part of the implementation process the actual cost of doing what they require is significantly higher than they have been led to believe or requires customisation they haven't been warned about.
All this kind of behaviour does is perpetuate the reputation CRM has for non delivery. An ethical issue or caveat emptor?

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