With Enterprise software solutions, it pays to be SaaS-y!

As a Product Manager of a SaaS (Software as a Service) product, I am often asked, “Why should I choose a SaaS solution over a hosted on-premise product?” My answer is the same elevator speech as every other employee of a SaaS company — you benefit from the upgrades each release, your subscription is an investment rather than a lease, blah blah blah. But since I’ve entered into the SaaS world several years ago, I’ve seen some products struggle to keep these benefits in practice.

SaaS Struggles in the Real World

There are two sets of behaviors where I’ve consistently seen SaaS products veer off into directions that slowly chip away at those great SaaS benefits: Death-by-Customization and Product Authoritarianism.

Death-by-Customization

Death-by-Customization is when software development teams use their Statement of Work (SOW) requests and customer-reported bugs to drive the direction of the product. This approach makes your CEO happy because you are bringing in “new” money, but the actual damage is done slowly over time as those SOWs are not treated as broader enhancement opportunities for the product. Instead they are basically implemented in a copy (customer request details)>paste (into feature implemented) fashion. As this practice continues, eventually everything becomes hard-coded for one customer or another.

“ …a customer is yelling for a feature request and the salesperson is on your case: ‘They’re going to leave us if we don’t do this!’ But customizing the product for individual clients leads to technical debt and lock-in. You have to resist this!” — Jock Busuttil, Mind the Product

This customer-specific implementation style sells your product and your users short. The customer comes to you with a need and it is ultimately your responsibility to give them a solution that meets that need. But remember, you have the benefit of seeing the same sort of problems from other customer points-of-view. Not using this information to shape your implementation removes a lot of the great reasons to go SaaS. The more customers using the software should result in an extremely flexible and robust solution! Excessive customization essentially results in individual customer software installations duct-taped together with a SaaS badge. How is that beneficial to your customer base?

Customers choose SaaS products mainly because of the benefits mentioned in the elevator pitch. They depend on the product team to understand their market and as a result the business practices that are agnostic across other companies using the same or similar functionality. In some cases, you may even understand their problem better than they do because you have handled it for numerous other customers previously.

For example, did the customer ask for a specific label for that shiny new field? Look at how other customers or organizations are performing that activity today. Do some research into the topic and see if there is an industry standard term for what they are seeking. You may discover that you are solving needs for other customers that you didn’t even know you had!

On my team “custom” is a dirty word that should be avoided at all costs. I realize there are times when it absolutely must be done, but only after you have exhausted all other options available to you. We have found in many cases that if you take just a step back from the problem and look at the bigger picture, you will come up with a better solution in the long run.

Better solutions = Happier Customers!

“…deliver more powerful user experiences that meet user needs rather than user wants.”

If all else fails and you must implement customization (Boo!!!), separate it out from the core application. This will ensure that your product stays “clean” and should make it easier to manage the customization work as the product evolves.

Product Authoritarianism

The other way to stomp out your product’s SaaS is the complete opposite approach to complete customization — product authoritarianism.

Product Authoritarianism is forgetting that your customers are individual, living, breathing ecosystems. They will have different needs.

This happens more often with the “Big Boy” B2B companies’ products. They see their clients as accounts — not communities of users. With the authoritarianism style, product changes are rolled out with no regard for change management. No one pays attention to how the software could be making activities significantly more challenging for users and/or organizations.

As your customers get frustrated, they start to look for other solutions that solve their problems better. Your customer retention goes down and new customers are less likely to buy into your vision.

If you build it, they may not actually come!!

Be More SaaS-y!

The SaaS-y Enterprise product provides a solid core offering while still enabling each business to operate autonomously, empowering them to do business at top performance. Providing the ability to turn business-impacting features on and off at-will and communicating major changes before they are deployed in Production are crucial. These simple steps enable your customers to understand how the feature will impact business and efficiency. Customers are then empowered to make the decision to implement immediately, improve on their processes, or opt-out completely from that feature.

The heart of living SaaS-y with your Product is being in tuned with your market and your customers.

Regardless of how well you know your product, you have to know your markets and customers better. That level of understanding is a crucial part of SaaS product management…if anything because it gives you the confidence you need when making the right decision.

Here are a few points on how to live up to that “Why SaaS?” elevator speech:

  • Everything is an opportunity: Developing SaaS-y means you treat every development activity as an opportunity for the entire customer base. The payer, other current customers, what the market is talking about…all of these things are part of the multi-faceted analysis of design. Custom work is always a fun opportunity to think outside the box. Plus, your customers really appreciate the fact that you have their long term best interests in mind and they will continue to benefit by using your product.
  • Don’t try to shove a square through a peg hole: It is important to know the distinction between truly custom work and something that has the potential to be a real feature. Always start with customer goals and requirements. Once those are understood, you may start the solution design. “Backwards” design (i.e. starting with a solution and working backwards to the customer requirements) will give you unhappy customers in the long run and potentially result in a lot of unnecessary re-work.
  • The best bang for the buck: Developing a feature that hits your overall audience of current customers, market needs and what is popping up in sales ops gets you way better ROI than custom development. The business with thank you for this several times over.
  • Make the Free Upgrades Worthwhile: Everyone likes free stuff, right?! Being SaaS-y means when a “something new” is released, all customers have the opportunity to take advantage of it! SaaS means no paid upgrades, or the problem of being on an older version and “if you just upgrade to the new version you won’t have problem X, Y and Z anymore!” Make the new release worth the downtime, and account for your customer base with the features you design and include in each release.
  • Use Feature Toggles Extensively: If it’s a big enhancement, it should be wrapped in a feature toggle until the solution is fully developed and accepted by your customer base. This is important to allow customers to maintain their organization’s business processes, but also start change management in a test environment. The latter allows the customer time to determine if and when their process and end users are ready to adopt something new.