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The SaaS Opportunity: Enterprise Content Management

August 31, 2011

We are all looking for new markets and opportunities. Here is one for you to grab that is untapped so far by any major players, at least not seriously.

Enterprise Content Management (ECM) is becoming more and more important for companies of all sizes. First it is more important due to regulations enforcing a better documentation for a longer duration and secondly as an opportunity to streamline processes and to get cost benefits. Not wanting to dive deep into ECM and its benefits let me point you to some resources:

ECM is part of a bigger information management concept. If you look at it, the majority of ECM solutions consist of software and consulting. The reason is that the ECM companies claim to create individual processes and adjust the software to these processes. Sounds like ERP, doesn’t it? Were we not all forced to customize our ERP so much that upgrading and switching to a competitive product become literally impossible? Apart from that annoying fact it also closed the door on many small- and medium-sized companies which just were not able to pay the price for that much consultancy. The other issue with ECM for small and medium companies (larger have the same issue but better economies of scale) is the ever-growing need for space. There is more and more content being created each and every day. While ECM helps to cut down the amount of storage needed for archiving by introducing processes to identify which data must not be archived, the issue itself remains.

This is how a SaaS offering might help the customers and how it is a great sales opportunity:

1. Opening up the door for small- and medium-sized businesses

By offering a service that is paid on a consumption base and avoids investments into software and hardware in advance business can start using the service small and grow over time. The enforced standardization of a SaaS offering might be a blocker for large enterprises but a welcome thought for the smaller companies.

2. Revenue structure change

It changes the revenue stream of the ECM company software maintenance and consulting towards a continuous service fee. Rather than one-off projects with a huge impact on the revenue line but also a high risk on forecasting, a services company will have a constant revenue stream. The revenue stream is not only another one in structure but also a new one as it taps a market so far untouched. So this is a real growth opportunity.

3. Enrich the SaaS Collaboration offerings of Google, Microsoft,, etc.

There are offerings in the market that deliver collaboration services like e.g. email, team collaboration and instant messaging. While these cloud offerings do bring enterprise class services into the small and medium business market already they all miss out on the need for ECM. You often do find reduced interfaces and features compared to on premise products or the lack of these completely. If you can create your ECM SaaS offering and manage to get it certified / running on e.g. Office 365 you will not only have a great market opportunity but also will get a whole new number of sellers, the partners of Microsoft, as well. This could be the fast track to growth and success.

4. Use the cloud to lower your investment cost

What is the roadblock to existing ECM software companies to enter the SaaS market? First of all it is the lack of infrastructure and employees to build and run such a service on a large scale. The result is that you do see some companies claiming they do offer cloud services but in reality work with hosting partners that do create individual environments per customer and operate these. An interesting first step but far away from the SaaS idea as proclaimed here.

Here is my suggested solution. Build your SaaS offering on existing PaaS solutions by e.g., Amazon or Microsoft. You can take your software and build it out on these elastic services and start there. You even can start by giving some of your developers an environment and let them play with it. You should though have an eye on which languages and standards are supported to minimize the effort to port your software as well as giving customers an easy route to your on premise software. By doing so you do avoid investments:

  • Data Center
  • Infrastructure
  • Employees
  • Updates
  • Software (OS, DB, etc.)

You can grow the environment on the fly and massively reduce your risk. Also you do enhance your chances of getting certified for O365 if you run your service on Azure, or any other combination if available.

5. Use the cloud to address privacy concerns

Another roadblock is the data privacy discussion. Remember that ECM is all about managing information so data privacy is a core component of an offering. Depending on the country the customers could by very aware if not frightened to use such a service. The effort to comply with data privacy requirements could be quite high and add up to the investment roadblock. On the other hand if you do build your service on already existing cloud services that do fulfill the local requirements you can easily create a safe, secure and legal service not only for you to offer but also for the customers to purchase.

6. Application marketplaces can help customers and providers alike

A key question that remains is sales. First of all I believe the first true SaaS ECM offering will get a lot of buzz in the community as well as press coverage. Being the first here gives you a real advantage. Secondly the announced market places for cloud solutions based on PaaS will be an additional platform for customers to evaluate and for providers to sell. You can even use the application market places for smart phone apps by creating client applications (which you should do anyhow) for these platforms.

So what is needed to transform an ECM software company into a service provider for SaaS ECM?

  • A management with a vision and a decision to get wheels in motion
  • A change agent for your sales. The transformation from selling software and consultancy to service is huge. Look at Microsoft and their long journey with MMS, BPOS and O365. As an ECM software company you do have one advantage though. You sales already focuses on the CxO level.
  • A development effort to port your software to the cloud
  • Relationships (if not existing you need to create them) to Google, Microsoft and so on.

Or in other terms you do need a business development manager that helps you to create the vision and takes the accountability to make it real.

Some additional remarks on things you need to be aware of:

  • Be clear in which markets you want to start, countries, verticals, company sizes, privacy regulations
  • Focus on one platform first (suggestion: O365 and Azure)
  • If you are not sure yet whether you are all in, give some developers the freedom to start playing with the PaaS platform
  • Identify customers among your existing base that would qualify as long hanging fruits and would be great references
  • Have an eye on new ways of collaboration. Any of these will open additional opportunities to broaden the customer base, e.g. ECM for Yammer or Chatter


  1. Mattias, in your third paragraph you suggest that ECM implementers act in a self interested manner when they seek to add customization to the solutions they deliver.

    As an experienced ECM implementer I have found that most customizations are driven ardently by the customer who is convinced that their content is different, their business patterns are special and they could not possibly change their paradigms to meet the OOTB solutions. These attitudes need to be moderated if they are to move to SaaS based solutions.

    I should say that I believe strongly that SaaS is a great model for delivering ECM. I think that as an industry we need to get better at leading our clients to make better decisions.

    I believe that solution providers need to ensure that they deliver robust standard patterns in their solutions that align to the needs of business, in that way avoiding the need to develop custom patterns is key.

    I think for the most part, IT professionals want to see the solutions they build last well for clients and deliver low TCO and rapid ROI. Building overly complex solutions can offer stimulating challenges at build time, but no one really looks forward to managing these customizations over time. Clients can be their own worst enemies sometimes..

    • Thanks for your comment Geoff, I agree with you that the customers do believe they are special and drive customizations. I had simplified my statement and you addition is right. On the other hand it is the software vendors and integrators that happily jump on this train to drive a major revenue stream from this. So there needs a shift to be happening on both sides, customers and vendors.

      The customer group I was referring to are the companies to small to drive a huge ECM customization project or the cannot make the invest to build out an ECM infrastructure. For these an SaaS offering opens up the doors to ECM and I predict that these will much more easily be able to live with a standard. This will be a whole new market and I believe if you look at the customer base for SaaS offerings in the colaboration space, Google Apps and Office 365, you’ll see the very same approach. Do not be fooled by both companies marketing the big deals. The majority of the SaaS busines comes from small and midsized businesses.

  2. I just wanted to let you know, that the ECM book is available in Englisch as well:

    and there are already offer solution for ECM … as a Service as it is mentioned in our Newsletter:

    Thereby we also state that the Cloud solution depends on trust (whereby the trustworthiness increases indeed with established cloud services) and is the perfect idea to lower fixed costs.

    • Vielen Dank (-;

      Thanks for the info on the book.

      With regards to your service please allow me to disagree. To me, that is classic hosting rather than SaaS. I do not mean to discredit your service, it probably is a great one but just not cloud really.
      It could be a stepping stone though and as pointed out the market is open to anybody to take it.

  3. I need to revisit my earlier statement with regards to SAPERION. By now there is a real SaaS offering based on Fujitsu’s Global Cloud. In that sense I feel to be obliged to update you on this an correct my earlier statement.

    Go to either the SAPERION web page or Fujitsu’s marketplace to learn more about the SaaS offering from SAPERION.

    Here is a link to the CEBIT report on Fujitsu’s Global Cloud:

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