Points of View

There Is a Way That ISVs Can Thrive in As-a-Service Economy

Nov 29, 2015 Pareekh Jain

Traditional Independent Software Vendors (ISVs) are undergoing massive disruption as the world is moving to the "As-a-Service Economy." On one hand, enterprise customers are changing dramatically so creating a tough external environment for ISVs while on the other hand, there is an increasingly strong competition from the new "born in the cloud" software vendors who are free of legacy investments the ISVs were forced to make. We believe that our eight ideaIs-based As-a-Service framework can be a guide for ISVs in their transformation journey leveraging software product engineering service providers. These eight ideals for ISVs to pursue are to:


  1. Write Off Legacy: which for ISVs means to move their legacy on-premises software to SaaS or cloud. It could be a completely new version or can be a migration of their existing software to the cloud, which is re-architected for multi tenancy, scalability and performance.
  2. Implement Design Thinking: which ISVs should apply not only to the front-end of customer or user experience but also to the backend to improve performance.  ISVs need to think about how user experience with consumer applications is changing their perception of the performance and usability of enterprise applications as well.
  3. Become Brokers of Capability: to navigate the additional requirements of software for different form factors, operating systems, social and analytics integration requirements, etc. as for one organization it is difficult to have all capabilities in-house.
  4. Undertake Collaborative Engagement: with their users to offer outcome-based pricing which implies that ISVs need to have similar risk/reward, transaction or gain share based collaborative pricing with their service providers and partners.
  5. Implement Intelligent Automation: of the software product development process across design, development, and testing using frameworks, tools, code reuse, accelerators, etc. to reduce time-to-market for new products and manage constant updates for existing products.
  6. Provide Accessible and Actionable Data: so ISVs not only need to enable their software products to handle real-time data access and analytics for their customers but also optimize their software product development and maintenance process leveraging that same actionable data.
  7. Ensure Holistic Security: of the data stored in software products to try and be one step ahead of cyber attackers. This will require specialized security knowledge, skills and approach that may go beyond what ISVs have traditionally had access to.
  8. Design For Plug and Play Digital Services: using micro services to drive mass customization in software product so that there is no or very little custom development expected from ISVs to make the software work in any enterprise environment.


We believe ISVs can survive disruption and even thrive in the As-a-Service Economy by striving to realize HfS’s eight ideals framework and by leveraging software product engineering service providers.


In next Soundbite on this topic, we will look at how software product engineering service providers are helping ISVs in their journey to As-a-Service. These two Soundbites are a prelude to our inaugural 2015 ISV Software Product Engineering Services Blueprint Report where we will look at ISV market closely and will evaluate innovation and execution capabilities of the leading software product engineering service providers including Alten Calsoft Labs, Belatrix, Cognizant, EPAM, Happiest Minds, Harman, HCL, IGATE, Luxoft, Nexient, Pactera, TCS, and Tech Mahindra. Keep watching this space.