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Nov 2016 - Industry Developments and Models - Doc # US41952716

Vendor Sourcing and Management: Software as a Service — RFP Foundation and Template

By: Aaron PolikaitisVice President of Research, Vendor Sourcing and Management

Abstract

This IDC study provides a template for vendor sourcing and management (VSM) practitioners looking to issue an RFP for SaaS applications hosted in the cloud. Many enterprises have relatively little experience evaluating and contracting for SaaS applications. As a result, many have overlooked and neglected to address the strategic elements defining their relationships with SaaS vendors. The result: suboptimal business terms governing strategic transformational relationships. IDC's latest research shows that in 2015, SaaS revenue increased by 26% over the previous year, reaching $64 billion (see Worldwide Software as a Service and Cloud Software Forecast, 2016–2020, IDC #US40852116, August 2016). Although traditional perpetual on-premise–based software license revenue is still growing, it is being far outpaced by SaaS. The template described in this study meets the following goals:

  • Long-term cost optimization
  • Governance in provisioning licenses
  • Contractual risk mitigation
  • Avoidance of overutilization and underutilization

This study focuses on IT strategy and governance, vendor sourcing and management, and outsourcing services.

According to Aaron Polikaitis, research vice president, IDC's IT Executive Programs (IEP) Vendor Sourcing and Management practice, "RFPs and competitive environments can be created in a streamlined and expeditious manner, satisfying even the most aggressive of digital transformation timelines. IDC's RFP template for SaaS helps VSM professionals accomplish this objective."


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