The 4 P’s of SaaS Governance

It is a rapidly evolving IT landscape where a host of hitherto Software Products and Solutions Vendors having on-premise offerings are making a rapid transition towards SaaS Offerings or On Demand Solutions. Given this reality, it is imperative to ensure that the Governance of your SaaS Vendors and their Services becomes an important lever of your forward-looking IT Governance Strategy.

Blindly trusting that your SaaS Vendors and Services will manage all aspects of the relationship in good faith, from the moment the RFP is raised till after the purchasing contract/ licensing agreement is signed and services are provided, may very well be a utopian reality. Going to the other extreme and utilizing any applicable SLAs/OLAs as the basis for punitive measures is a move that can, if at all, produce results in the short run but typically backfires in the long run. The need for a well-formulated SG framework becomes all the more relevant in ensuring that the SaaS benefit projections lives up to its long term expectations instead of sputtering out ultimately after an encouraging start.

What then is required to ensure that SaaS Governance occurs seamlessly in your organization? What aspects of the Organizational Governance, Risk and Compliance (GRC) exactly does SG encompass within your organization? What will allow your organization to realize optimum SaaS benefits?

The answers can be determined by examining the core dimensions as outlined by the IT Governance work horse framework – COBIT and its relevance with the SaaS scenario:

1. Strategic Alignment – Alignment of the SaaS/ SOA offerings with the Organization’s core Strategy
2. Risk Management – Manage Risks of the SaaS/ SOA offerings appropriately through a structured, streamlined manner
3. Performance Management – Management of Performance of individual and integrated SaaS/ SOA offerings
4. Resource Management – Resource Management to optimize utilization and capacity planning across SaaS/ SOA offerings
5. Value Delivery – Ensuring that Business Value of the SaaS/ SOA offerings is continuously delivered

Based on this starting point, it is possible to establish an overarching framework of SG that encompasses the 4 P’s. The 4 P’s that will be the foundation of any SG framework can be distinctly characterized as:
1. People – Ensuring that the correct people are in the correct decision making roles within the organizational hierarchy
2. Process – Designing and enforcing the processes necessary for streamlining the SaaS Lifecycle to optimize business value
3. Performance – Monitoring Performance of SLAs and relevant business metrics with mutually agreed upon terms
4. Price – Pricing a SG Solution right so that it meets all the above objectives and produces the desired outcomes on a continuous basis

SaaS Governance is clearly an ongoing process, and something that fits well within the GRC framework within any established organization. Ingraining SG within the organization and making it an integral part of tactics and operations requires a project mentality, dimensions of which will be directly proportional to the extent of current and future services that are migrated to the SaaS model. This framework should be built on sound principles that ensure that it is agile, adaptive, forward looking and business value focused to ensure that future value is continuously realized across all SaaS initiatives.

SaaS Governance can provide the much required visibility and transparency in the long term relationship between various SaaS vendors and your organization. Having a framework in place eliminates the myriad doubts typically associated with SaaS engagements; to name a few – who is accountable for any customer requested changes, what is the remedial action if a customization goes awry, what is the impact of amendments to the contract, how will it be identified whether service levels are in conformance with requested levels, what if uptime SLAs are not met, how to handle strategic dimensions of the contract, how to identify and tap future potential of SaaS vendors, etc.

A streamlined SG framework can go a long way in ensuring that continuous benefits are accrued across all organizational IT SaaS initiatives. The business is thus free to focus on its core strategic competencies and build its sustainable competitive advantages with the proper business IT alignment to continuously deliver superior value to its customers.