Published on Sep 23, 2019
Updated on May 22, 2024
We are now living in the age of hyper-convenience, and the market for convenience (as-a-service) is soaring. For the better half of the last ten years, we have swiftly passed into the ‘as-a-service’ economy. The globalization of labour, highly disruptive business models and rapid consumerization have made the transition nearly inevitable.
The heightened experience of ‘utility’ extends to both consumers and even businesses. From hailing a taxi or buying groceries to quick entertainment and daily productivity tools, everything is/can be made available as-a-service. So how did XaaS get to this point? — where it’s now the preferred operating model of choice for delivering any IT function as a service for consumption.
The ‘as-a-service’ concept is universally understood to be an analogue of cloud computing. It is predicted to be valued at nearly $344B by 2024, growing at 24% over the next five years.
The approach has been around since the ‘60s when SaaS quickly replaced the older ASP (Application System Provider) model. The real reason the ASP model failed? It wasn’t scalable. Gone are the days of buying licensed software products and lengthy on-site installation processes. In contrast, with SaaS, enterprises can buy and pay for what they use. By taking advantage of virtualization and cloud-based scalability — users access the same code base, while their data and customized interfaces are kept separate.
Towards the close of the millennium, Salesforce built the very first complete SaaS product, which is still today — one of the World’s most widely used customer relationship management (CRM) tools.
Over the next ten years, SaaS quickly decentralized into Desktop; Data; Network; Security; Infrastructure; and Platform-as-a-service. Today, any core business function can be delivered through this model, such as Marketing, Banking, Healthcare, Appliances and Gaming among many others.
Consumers, in the meantime, have become increasingly familiar with ‘use without ownership’ type of products including movies-as-a-service (Netflix, Hulu); communication-as-a-service (Whatsapp, Snapchat)
While companies like Uber & Grab have leveraged ‘service-as-a-product’ effectively — shifting the balance from car ownership to transportation-as-a-service; others like Joule have moved towards outcome-based pricing where users can subscribe to cars without any time limit.
The essence of XaaS is simply delivering a service over the Internet, rather than on-site. The most efficient way to do this is through the cloud. Being more cheaper and efficient, the cloud services model witnessed mainstream adoption only within the last decade. The real advantage stays the ability for companies to wholly deliver a one-click operation for the end-user.
Tesla has already disrupted the automobile industry with its radical as-a-service concept: upgrade your car (software) for free, for life! Tesla is also planning to shift to pay-as-you-use models including autonomously renting out your car when you are on holiday.
Consumers easily get behind this technology because it reduces any ownership risk and encourages more users to try these services at affordable and competitive pricing. This is how and why we have pizza-as-a-service today! Hence XaaS.
How does XaaS help your business?
There are currently over 5.6 million professional and creative services companies in operation around the world. Technology is constantly evolving the state of how we do business, and the operating models we use today will have to adapt to innovations that disrupt tomorrow.
The Real Impact of XaaS
- The Cloud has moved beyond the “hype” realm into a digital must-have for any enterprise. Regardless of the size of the business, the cloud is your best bet for maximum scalability and mobility.
- One-to-many is now a customizable relationship, thanks to XaaS models that help you deploy services with precision and speed.
- Agile enablement calls for being nimble across software delivery. Create business value through incremental, sustainable, and measurable agility.
- Plug and Play allows for maximizing combined services, greater efficiency gains, and uptime — giving your business the autonomy to use services as and when you need.
- Resource & Cost-lax operations reduce major overheads by 3-5X by leveraging the right consumption-based models.
The move away from legacy business mechanisms, ties to the resource-intensive effort of shifting from selling products to selling capabilities. If the front office and back office aren’t aligned, the business will struggle to move forward.
Enterprises are increasingly looking to achieve results through as-a-service models—using hybrid delivery—that can be explicitly configured to deliver critical business outcomes in a short turnaround time.
Talk to us today to learn how we are helping enterprises operate successfully in the digital world. Drop us a line here hello@mantralabsglobal.com
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