Sunday, November 20, 2011

SaaS Maturity Level

Cloud is catching up amongst enterprises. Amidst the security and the other concerns that are still to be addressed, CIOs are seeing a clear benefit in shifting towards the Cloud offerings. That means, there is an increasing number of enterprises seriously engaging cloud based applications. This necessitates the need for a model to measure or assess a SaaS application. Like we have Capability Maturity Model to assess a software development shop to be at a particular level, we need a maturity model to assess the SaaS application.

Microsoft way back in 2006 suggested a 4 level maturity model using Scalability, Multi-Tenancy and Configuration to define various stages. While Level 1 is meant to define an ad-hoc hosted application which lacks all the three basic fundamental characteristics and at Level 4 a SaaS application is expected to meet all these three basic characteristics. This model has its own deficiencies as it does not consider few other important characteristics of a SaaS application, like for instance managing the releases, data isolation, etc.

Forrester has come up with the six level definition of SaaS Maturity. Let us examine each of these levels as below:

Level 0: Just Outsourcing, not SaaS. This is a typical scenario where a service provider operates a software installation for a large customer and cannot leverage this setup for another customer. This is just outsourcing and not SaaS.

Level 1: Manual ASP (Application Service Provider). In this case, the service provider has established unique skill in operating similar service to multiple customers, but each client has a dedicated instance and each instance is manually customized by the service provider to the needs of the customer.

Level 2: Industrial ASP, still not SaaS. The Application Service Provider uses techniques to package and deploy the application with different configurations for different customers. In this case, still the customer does not have the ability to customize their instance of the application.

Level 3: Single-app SaaS. This is when the provider is able to offer application  as service to multiple customers out of single packaged application. This is the initial level of SaaS, wherein the application demonstrates some of the basic characteristics of Software as a Service.  At this level, the provider deploys the packaged application on a scalable infrastructure, and shares the single instance to multiple customers with customization limited to configurations.

Level 4: Business Domain SaaS. At this level, the provider offers a well defined business application and also a host of packaged application modules or third party packages, with which the customer has the ability to extend the business logic of the application.

Level 5: Dynamic Business Apps as a Service. This level is a visionary target where in the provider offers a comprehensive application and integration platform on demand. With this ability, the provider can compose tenant specific and even user specific business applications or services.

SEI has in line with the popular CMMI for development, presented CMMI for services packing in some of the service specific process areas in addition to typical development related practice areas. This however is used to assess an organization offering services as against assessing a SaaS product.

As of now, none of the models are popular amongst the major SaaS vendors, may be because of not enough competition on the SaaS space. Once major players compete on SaaS space, then customers for sure will find a way to assess the service maturity and that could be the way forward.

Please throw in your comments.


  1. Industry in Australia is coming together to propose star rating for cloud service providers. Check this out

  2. Thanks for the reference. Yes, that's about an indicator for cloud maturity and similarly which can be extended to Saas Maturity as well. However, given the global spread of the clouds, it would be ideal if some standards body takes this up and come forward to specify the standards and frameworks.

  3. Just came across an interesting blog on calculating ROI for SaaS applications. The author also considers the maturity level into account in the calculation.

  4. Hi Senthil,

    Thanks for sharing the blog calculating RoI. That is an interesting one and useful too.