Ken Rudin gave an interesting talk to the newly revived SDForum Software as a Service (SaaS) SIG on "Not-Yet-Common Wisdom in SaaS". I have heard the main points of his talk at previous presentations at the SaaS SIG. The interest was in the little details and real world experience that he bring to the topic.
Ken has been doing SaaS for a long time. He was an early employee at SalesForce.com, running their engineering team. He was on the original board of NetSuite, and created the Siebel CRM OnDemand division at Siebel. Now he has a new startup called LucidEra that is bringing SaaS to Business Intelligence.
Ken spoke for some time on the engineering challenges of SaaS. He explained why Enterprise software suffers from "feature" bloat (something I have complained about before) and SaaS does not. He also discussed the challenge of making software adapt to customer requirements. Enterprise software is usually given some programmatic customizability. With SaaS, allowing the end-user to program the product is a death knell, so the trick with SaaS is to provide the right simple options so that the customer can configure the software themselves by for example clicking check-boxes.
Related to this Ken talked about doing the relative efficiency of silicon versus carbon. By carbon he means people. Silicon is cheap and scalable while carbon is neither. While it is an amusing metaphor, it risks being confused with the other carbon problem.
Ken was also illuminating on the business problem of Enterprise software companies like SAP and Siebel that try to provide a SaaS version of their product. He termed this SoSaaS (Same old Software as a Service). Basically the business drivers are such that the two models cannot co-exist as peers. The most common outcome is that the SaaS offerings is sidelined as the little brother product and does not thrive.