1. An Overview of SaaS – And some privacy questions Based on work by Julie Smith David and Michael T. Lee, sponsored by CABIT and the Society for Information Management

2. Agenda Gathering for the perfect storm? frustration economyacceptance Stage 1: Introduction to SaaS Stage 2: Privacy Issues

3. Gathering for the “Perfect SaaS Storm”? the economy

4. frustration End-user frustration with ERP applications often drives a business' first post- ERP projects. At Amoco's chemical intermediates group, for example, the need to channel SAP R/3 information into more user-friendly applications became apparent as the ERP system was being implemented early last year, says Kerry Given, IT manager for the unit. "Managers found SAP so unfriendly they refused to use it," he says. "Few [of our] people use SAP directly because you have to be an expert." November 30, 1998

5. the economy frustration acceptance

6. the economy frustration acceptance

7. the economy frustration acceptance It’s time to take SaaS seriously! Photo is by LeibDich, available at http://www.flickr.com/photos/liebedich/3679711527/,http://www.flickr.com/photos/liebedich/3679711527/ and used under the CreativeCommons license

8. Gathering for the perfect storm? Let’s go deeper into SaaS frustration economyacceptance Stage 1: Introduction to SaaS

9. Supply Chain Representation: Traditional Model Your Company Hardware Company Software Company Software Company PC’s, Servers, Network Devices, … Operating systems, ERP, CRM…

10. SaaS Company SaaS Company Supply Chain Representation: SaaS Model Your Company Hardware Company Software Company Software Company Servers, Network Devices… Operating systems PCs (with Browsers) ERP, CRM Service Client Company

11. A Quick Review: SaaS Characteristics Technical – Browser based: Reduced upgrade issues Lower cost hardware – Hardware acquisition, operations, maintenance – Multi-tenant – Agile development Maintenance experience Innovation Strategic – Low initial acquisition costs – Quicker Implementations – Predictable pricing – Reduced support staff needed – Potentially more agile environment with significant innovation

12. How Multi-Tenancy works Source: Peter Coffee, Salesforce.com

14. PaaS Company PaaS Company PaaS Model Your Company Hardware Company Software Company Software Company Servers, Network Devices… Operating systems, ERP, CRM… PCs (with Browsers) Service Client Company Native Developers Native Developers Composite Company

15. PaaS to Preferred Platform Development Efforts Size of Adopting Organization Individual Apps Complex Suites Individuals SmallMid-Tier Large Integ. Apps Niche Suites Small Devel. Major SW Co. Ind- Mid Ind. Leader, Niche SW Software Development Organizations Created with Brian Sommer

16. Proposition: SaaS is a Disruptive Technology Source: Mann and David, 2007. For more, see: Harrigan, K. R. 1984. Formulating Vertical Integration Strategies The Academy of Management Review 9 (4):15. Rothaermel, F. T., M. A. Hitt, and L. A. Jobe. 2006. Balancing vertical integration and strategic outsourcing: Effects on product portfolio, product success, and firm performance. Strategic Management Journal 27:1033-1056.

17. When/Why to Select SaaS (Updated) Source: http://blogs.idc.com/ie/wp-content/uploads/2009/12/idc_cloud_benefits_2009.jpg

18. New Reasons Commoditization of IT – IT applications are available for almost anything – Leave it to the hands of experts – Comes down to the decisions and how it is used New leverage for knowledge – SaaS can be used to push out legacy data and information to create and distribute knowledge globally at minimal incremental cost Upgrades – Small time window, cost included in subscription – No hardware, software, patches, space requirements – Upgrade process Elastic scalability – Instant – Integratability/Interoperability – Customizable/Programmable Shared infrastructure – Functions are at the metadata level, not at the code level (airline model) – Industrial strength infrastructure, allowing customization at the metadata level

19. Issues/Challenges http://blogs.idc.com/ie/wp-content/uploads/2009/12/idc_cloud_challenges_2009.jpg

20. Agenda Gathering for the perfect storm? frustration economyacceptance Stage 1: Introduction to SaaS Stage 2: Privacy Issues

21. What we already touched on: Source: Prosch, M. and J.S. David. 2009. Extending the Value Chain to Incorporate Privacy by Design Principles

22. An integrated “X as a Service” stack Source: Linthicum, D. 2009. Cloud Computing and SOA Convergence in Your Enterprise: A Step-by-Step Guide. Addison-Wesley Information Technology Series.

23. With XaaS Proliferation Source: Prosch, M. and J.S. David. 2009. Extending the Value Chain to Incorporate Privacy by Design Principles

24. ProgramsGoals Resource Allocations Corporate Culture Fiscal Viability Expectations Compliance Community Involvement Environmental Improvements Economic Benefits Education Support Create a Privacy Culture, Cavoukian, 2008 Privacy Payoff, Cavoukian & Hamilton, 2008 Customer Churnrate, Ponemon 2007 Privacy Cultural Lag Theory, Prosch 2008 FTC Sanctions State Attorney Generals EU Safe Harbor Privacy Policies Chief Privacy Officer Privacy Enhancing Technologies Privacy Audit Privacy Maturity Lifecycle, Prosch 2008 Privacy Payoff, Cavoukian & Hamilton, 2008 Reducing data pollution: Reducing identify theft risk, Unnecessary workplace Monitoring, cyberbullying, etc. Educating customers/employees Rights & obligations in process Allowing constituents a “voice” in privacy design Nehmer & Prosch 2009 Model of Privacy Corporate Responsibility Based on Dillard & Layzell’s 2008 Model

30. Privacy by Design Principles Respect for User Privacy Visibility and Trans- parency End – to – End Lifecycle End – to – End Lifecycle Positive Sum – Not Zero Sum Positive Sum – Not Zero Sum Privacy Embedded into Design Privacy as the Default Proactive v Reactive Proactive v Reactive

31. Questions - For Ben!

32. Please Keep In Touch! julie.smith.david@asu.edu michael.t.lee@asu.edu

33. Really? Security? – Compared to what? – Facility/network – Privileges – SAS 70, SysTrust, ISO 27001 Availability/Performance? – Operational reporting – Dealing with abnormalities – Uptime reality – Transparency: Dashboards Cost more? – Predictable – Hardware, software, upgrades, recovery, security, space – Up to 5X faster development Integration difficulty? – Proliferation of integratable and customizable applications – Standard development platform – IaaS, PaaS Customizability? – Proliferation of customizable applications – Comprehensive tool sets – Shared infrastructure – Upgrade process Vendor lock in? Survivability? – Proprietary languages/technologies – Switching costs – API’s, ETL tools – How different from ABAP? Source: Peter Coffee, Salesforce.com