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Saas favors the innovators in the classic style described by
Christiansen & Clayton in The Innovators Solution. Companies
like Salesforce & ExactTarget are prime examples of starting at
the low end of a business and being dismissed by the bigger (in
this case, "enterprise") vendors. the innovator has the advantage
of no channel conflict as Greg points out. Additionally they can
perfect their model in a lower risk environment at the low end.
As they move upstream they gain momentum and it takes
drastic and often unpalatable changes on the part of the
traditional incumbents to compete. The book uses the Steel
industry as a metaphor: comparing the rise of the mini-mills in
the face of the Vertically Integrated Giants. quote: "Well maybe
the can make rebar, but they'll never compete with us in flat
rolled steel."
Enterprise software is the equivalent of Flat Rolled Steel in this
case. Watch out
- Posted by: chrisbaggott Posted on: 10/24/06 You are currently: a Guest | Members login | Terms of Use
The Innovators Solution
chrisbaggott | 10/24/06
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