A THINKstrategies

Primer for CIOs

Select the Right Cloud-Based

ITSM Solution:
A Step-By-Step Guide to Determine Your
Immediate and Long-Term Requirements

Published on Behalf of BMC Software

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.1

White Paper

Select the Right Cloud-Based ITSM Solution

Executive Summary
IT organizations are being forced to reevaluate how they operate in order to keep pace with the
changing nature of business today.
Fortunately, a new generation of IT Service Management (ITSM) solutions is available via a more
flexible Software-as-a-Service (SaaS) delivery platform which not only makes the basic tasks of dayto-day ITSM easier, but also addresses the additional challenges associated with todays
increasingly face-paced and demanding work environment.
Todays cloud-based solutions enables IT organizations to more quickly deploy and fully utilize the
latest ITSM innovations so they can focus more of their energies on satisfying the escalating needs
of their end-users and executives. Cloud-based ITSM platforms also include mobile, social and
other essential technological features to better support their corporate requirements. And, the
new platforms provide more powerful analytics to measure performance and include more userfriendly reporting capabilities that demonstrate to corporate end-users and executives the business
benefits being delivered by IT.
This whitepaper will explain how Chief Information Officers (CIOs) can select the right cloud-based
ITSM platform to capitalize on the latest innovations being delivered today.

Why IT Organizations are Migrating to Cloud-Based SaaS ITSM Solutions

The business world is changing.
It is becoming more global, competitive, fast-paced, and unpredictable.
And, economic uncertainty continues to force many organizations to adopt new operating policies
and procedures that require fewer large-scale capital investments so they can become more agile
and responsive to changing customer demands and employee needs.
Technological advancements are also changing the nature of business as employees become more
mobile and dispersed. According to a recent report from market research firm Juniper Research,
the number of employee-owned smartphones and tablets used in the enterprise will exceed 1
billion by 2018.1 This trend is not only driving a growing number of businesses to adopt Bring Your
Own Devices policies, it is also compelling many organizations to add cloud computing capabilities
to their corporate resources to make it easier for end-users and executives to share information
and collaborate.
Gartner predicts that the majority of new IT spending by 2016 will be for cloud computing
platforms and applications with nearly half of large enterprises having cloud deployments by the
end of 2017.2
In addition to the functional benefits of moving to the cloud, the shift is being fueled by the rapid
return-on-investment (ROI) and time to value provided by these new on-demand services. In fact,
seventy percent (70%) of the respondents to a recent KPMG global survey believe cloud computing
is delivering operating efficiencies and cost savings today.3

Source: BYOD Policies to Bring 1 Billion Devices to Businesses by 2018, ChannelInsider, November 26, 2013,
http://www.channelinsider.com/mobile-devices/byod-policies-bring-a-billion-devices-to-businesses-by-2018.html
2

Source: Gartner Says Cloud Computing Will Become the Bulk of New IT Spend by 2016. Company Press Release,
http://www.gartner.com/newsroom/id/2613015.
3

Source: Breaking Through the Cloud Adoption Barriers, a KPMG Cloud Providers Survey, www.kpmg.com/cloud.

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.2

White Paper

Select the Right Cloud-Based ITSM Solution

These operating efficiencies and cost savings are being generated within strategic business units
(SBUs). A growing number of IT organizations are turning to SaaS ITSM platforms to improve their
operations and gain additional functional capabilities.
Many market research firms estimate IT organizations have historically spent 75-80% of their time
and resources performing daily tasks aimed at simply keeping their operations up and running, and
reacting to corporate IT and software issues as they arise. An AlixPartners/CFO Research survey of
150 senior finance executives found that 63% believe their companies are spending too heavily on
keeping their IT services up and running, and a greater share of their expenditures should be
directed to improve-the-business IT projects.4
Enlightened IT organizations recognize that the old way of managing IT hasnt worked and they
need a new set of tools to better serve their corporate end-users and executives. SaaS ITSM
platforms enable them to more quickly deploy, easily monitor and cost-effectively manage their
operations on an ongoing basis.

Capitalizing on the Benefits of On-Demand, Cloud-Based ITSM Solutions

Cloud-based ITSM solutions enable IT organizations to eliminate many of the risks associated with
selecting, implementing and administering ITSM platforms.
These solutions are designed to be quicker to implement and easier to operate. They also shift the
burden of success from the ITSM user to the ITSM vendor which must ensure the success of the
customer in order to assure their satisfaction and loyalty.
The out-of-the-box, ready to use design of SaaS-based ITSM platforms, along with their pay-asyou-go subscription pricing, enables IT organizations to more easily deploy and quickly utilize the
ITSM functionality they need without being burdened with costly features they can do without.
As a result, cloud-based ITSM solutions eliminate many of the upfront costs and ongoing
complexities associated with traditional, on-premise software.
The on-demand delivery model can produce a faster time-to-value and greater return-oninvestment (ROI). The pay-as-you-go SaaS model also enables IT organizations to calibrate their
expenditures more effectively to match the actual number of staff who will utilize the ITSM
solution. It also permits IT organizations to more cost-effectively scale their operations.
SaaS ITSM solutions include continuous software updates that are automatically implemented
across the user base. This means that individual IT organizations dont have to waste a lot of time
performing these updates, and the IT organizations get to take advantage of the latest ITSM
innovations immediately. It also means that IT organizations gain access to the same features
equally, regardless of their size or sophistication.
In other words, cloud-based ITSM solutions reduce the ongoing cost-of-ownership while increasing
the ROI. In fact, a recent study by the investment firm, Cowen and Company, found that SaaS
applications can cost up to 50% less to deploy and operate than traditional on-premise software.5
But, as IT decision-makers shift their focus to SaaS ITSM alternatives they discover they must
choose among a wide array of options. Here are some tips about how to make the right ondemand, SaaS ITSM choice.
4

AlixPartners/CFO Research Press Release, March 5, 2013, http://bit.ly/1gKoIwK.

Enterprise Software Vendors Face Deflation: Advantage SaaS, ZDnet, October 11, 2013,
http://www.zdnet.com/enterprise-software-vendors-face-deflation-advantage-saas-7000021862/
THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.3

White Paper

Select the Right Cloud-Based ITSM Solution

A Checklist for Selecting the Right SaaS-Based ITSM Solution

Step One Dont Compromise on Functionality, Security and Performance

Many IT decision-makers have the misconception on-demand, SaaS-based ITSM solutions lack the
functionality, security or performance capabilities of traditional, on-premise ITSM platforms.
On the contrary, the leading SaaS ITSM platforms, such as BMC Remedy OnDemand, offer a full set
of functional capabilities, including:

Incident management

Problem management

Change management

Asset management

Discovery and dependency

Configuration Management Database (CMDB)

Knowledge Management

Service Level Management

Todays SaaS-based ITSM platforms also boast robust access controls, audit and tracking
capabilities, and other security features to safeguard against external and internal threats.
More importantly, IT organizations can access these functional capabilities more easily and quickly
than in traditional, on-premise ITSM systems.
So, be sure you select a SaaS-based ITSM platform that provides what you need.
Step Two Focus on SaaS ITSM Added Value Rather Than Just Cost-Savings

The primary motivation for most decision-makers seeking a cloud-based ITSM solution tends to be
reducing the upfront investment and ongoing maintenance costs associated with acquiring and
deploying an ITSM system.
But, the real value of todays new on-demand solutions is the added functionality they provide.
The functional advantage begins with the delivery of the SaaS solution via a single code-base which
enables the ITSM vendor to roll out updates and upgrades in a uniform fashion across its customer
base, so all the users get equal access to new functionality simultaneously.
This means every IT organization utilizing the platform gains access to the latest innovations offered
by the ITSM vendor. It also means users do not have to worry about the latest updates disrupting
their ongoing operations or existing databases.
SaaS platforms can also be accessed remotely by authorized IT staff and other personnel via a web
interface to permit quicker response to issues and alerts, greater collaboration across the
organization, and better transparency among corporate end-users and executives.
The leading SaaS ITSM platforms provide detailed log records. They also are easy to configure to
ensure the proper alerts are in place in the event of a potential system failure, illicit attack, or
inadvertent mistake.

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.4

White Paper

Select the Right Cloud-Based ITSM Solution

Added reporting and analytics capabilities give IT organizations more information and insight to
make timely decisions, and properly plan and budget for the future to meet their evolving
corporate needs.
The leading SaaS ITSM vendors are also producing benchmark statistics based on real-world usage
patterns that can serve as key performance indicators (KPIs) for their customers based on the best
practices of their peers.
Step Three Pay Attention to the User Experience to Ensure SaaS ITSM Utilization and ROI
The growing demand for SaaS ITSM solutions has led many legacy ITSM vendors to rebrand and
offer their on-premise systems as hosted services. While this tactic might shift the deployment and
maintenance burden from the user to the vendor, it doesnt change the user experience.
In a software world that is increasingly being driven by the ease-of-use of consumer applications,
enterprise software must meet a higher standard in order to satisfy the rising expectations of
corporate end-users, including IT professionals. Making sure the SaaS ITSM user interface is
intuitive and easy to use is important because it will encourage quicker adoption and greater
utilization. It also reduces training costs and enables more staff to take advantage of the ITSM
capabilities.
Encouraging greater utilization is essential in a highly dispersed IT organization because it can
enable the organization to better track issues and capture valuable problem resolution information
in a centralized database. This permits the staff to more quickly resolve future problems and even
propose solutions that address recurring issues and mitigate potential risks.
Step Four Dont Forget the Most Important Criteria for Selection
The most important criteria for selection in the on-demand, SaaS ITSM market are the same as
those which have historically been essential in the on-premise system world:

Customer References The real measure of the value of a specific solution is the number of
customers willing to verify that it is delivering tangible benefits. If the SaaS ITSM vendor
cant provide compelling customer references, walk away.

Partner Ecosystem Another key indicator of the real value of a specific solution is the
number and quality of the business partners that are excited about associating themselves
with the solution. If the SaaS ITSM vendor hasnt attracted a substantial number of
enthusiastic partners, stay away.

Financial Viability The rapid growth of the SaaS/Cloud marketplace has attracted an
overwhelming number of vendors seeking to win a share of the market. Since price
competition is pervasive, they cant all survive and a shakeout is inevitable. If a SaaS ITSM
vendor isnt generating enough revenue and well-funded, they will go away.

Future-Proofing While the fundamental value proposition of cloud-based ITSM solutions

is that you can pay-as-you-go, that doesnt necessarily mean that the solution will grow to
meet your expanding demands. So, be sure the SaaS ITSM solution can scale to support
your growing organizational needs, or you may have to move away from the platform later.

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.5

White Paper

Select the Right Cloud-Based ITSM Solution

Summary & Conclusions

IT organizations of all sizes across nearly every industry are facing unprecedented pressures to
better serve their corporate executives and end-users.
As corporate executives and end-users become more technology savvy, their expectations are
rising. And, as the nature of the workplace becomes more dispersed with a more mobile workforce,
IT organizations must adopt new approaches to acquiring and managing software and systems to
meet their rapidly evolving business requirements.
SaaS-based ITSM solutions, like Remedy OnDemand, are designed to meet these needs. They have
been designed to be easier to deploy and user-friendly so they can be more quickly utilized at a
lower total-cost-ownership (TCO).
SaaS ITSM platforms also enable IT organizations to take advantage of the latest innovations in the
IT management arena, measure their effectiveness based on industry KPIs and best practices.
They are also more scalable to meet an IT organizations evolving management needs.
In sum, these platforms have demonstrated that they can produce measurable business benefits,
including significant greater cost-savings, productivity improvements and higher customer
satisfaction. As a result, a growing number of CIOs and IT organizations are adopting cloud-based
ITSM solutions to address todays escalating business challenges and achieve their corporate
objectives.
Be sure to use a formal set of criteria to select the right SaaS ITSM solution to meet your immediate
and long-term requirements.

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.6

White Paper

Select the Right Cloud-Based ITSM Solution

About THINKstrategies, Inc.

THINKstrategies, Inc. is the only strategic consulting services company focused entirely on helping its clients
capitalize on the unprecedented business opportunities created by the technology industry shift from a
product-centric to a services-driven orientation and an on-demand delivery model, such as Cloud
Computing, Software-as-a-Service (SaaS) and Managed Services.
THINKstrategies mission is to help our clients re-THINK their corporate strategies, refocus their resources
and re-align their operations to achieve their business objectives. THINKstrategies helps enterprise decisionmakers with their sourcing strategies, IT solutions providers with their marketing strategies, and VCs with
their investment strategies.
THINKstrategies has also created the Cloud Computing Showplace online directory and best practices
resource center to help IT and business decision-makers find and fully leverage todays leading SaaS,
Platform-as-a-Service (PaaS) and Infrastructure-as-a-Service (IaaS) solutions. To learn more about the Cloud
Computing Showplace, go to www.cloudshowplace.com.
For more information regarding our unique capabilities, visit www.thinkstrategies.com, or contact us at
info@thinkstrategies.com.

THINKstrategies, Inc., 2013

www.thinkstrategies.com

p.7