The Fortiva Blog

SLAs a must for SaaS providers

Posted by Chris Moores, Professional Services

Salesforce has often been cited as the pioneer for the Software-as-a-Service (SaaS) industry. We use Salesforce ourselves, and have been quite happy with this decision. However, I recently requested a copy of their Service Level Agreement (SLA) for service availability and was taken aback with the reaction I got from their customer support department. The responses I got ranged from “What’s an SLA?” to “Do you mean you want to know our support ticket resolution time?” to “In the 5 years I have been working here, I’ve never had anyone ask that question.”

It doesn’t seem like Salesforce has any SLAs, which I find very odd. This prompted me to run some online searches, and the results surprised me a bit – I didn’t realize that SLAs are far from prevalent among SaaS providers. I think this could be one reason why some IT departments are still quite skeptical about using SaaS applications.

As Craig had pointed out in a previous post, we constantly hear from customers that one of the things they love about outsourcing is that they no longer have to stress about uptime and performance. At Fortiva/Proofpoint, we not only take over the stress of managing all infrastructure and archiving application issues that may arise, we also strive for unsurpassed customer service and industry leading SLAs that few providers (both outsourced or on-premise) can match.

SaaS vs. On-Premise Email Archiving (2 of 2)

By Fortiva Blog Editor

Earlier, we mentioned that for several reasons email archiving is best managed by a SaaS specialist rather than on-premise. Here is a more in-depth look at the time, effort, and costs involved with each deployment method so that you will get a better understanding of why SaaS is the better choice for an email archive.

Planning
Before implementing an on-premise archive, IT has to conduct some upfront planning that includes identifying the required infrastructure, designing the implementation, projecting growth requirements, and determining the upfront capital costs involved. Adequate planning will run between 3 to 6 months on average. On the other hand, SaaS implementations such as Fortiva require a limited amount of planning on the customer’s part and can be done in 1 to 14 days depending on the size of the customer and number of locations involved.

Implementation
For an on-premise solution, getting up and running means purchasing the required hardware, installing the archiving software, integrating it with existing systems, and testing it to make sure that the solution does not create problems with other applications. If you want to maintain a redundant copy of the archive as a risk-reduction feature, you will have to repeat this process in a secondary data-center and adjust your budgets accordingly. On average, this entire process can take 2 to 4 months for an on-premise solution. For a SaaS solution, getting up and running just means plugging in the application and adding in the user names which can be done in a day. Total implementation time for a SaaS solution is typically 1 to 5 days.

Maintenance & Management of Data
There are several tasks that must be done on an on-going basis in order to maintain an email archive. Generally the tasks include data disposition to ensure that emails that have exceeded the retention term are deleted from the archive; backing-up the archive on a regular basis to make sure archived data is properly preserved and recoverable when required (this can be a challenge as the archive grows over time); monitoring the archive to identify problems; and troubleshooting hardware failures, outages, and other issues as they come up. For an on-premise solution, this will require a great deal of IT time and may require additional resources. However, with a SaaS solution, all these management and maintenance related tasks are taken care of by the solution provider thus allowing the customer organization’s IT team to focus on their other priorities. Additionally, SaaS solutions such as Fortiva provide customers with 24x7 monitoring and issue resolution, which is rarely the case with an on-premise archiving solution.

Performance & Upgrades
The nature of archiving is such that you will eventually run out of storage. This makes it necessary to perform ongoing capacity planning to ensure storage requirements are met as the archive grows. For an on-premise solution, this will require the purchase of additional servers and data center space as necessary. Additionally, it is important to note that technology is constantly being improved and hardware options for data storage will inevitably undergo significant changes within 3 to 5 years.  This makes the likelihood of moving archived data to newer storage technologies very high and will require a high level of expertise on behalf of your IT team. Finally, if the hardware is not upgraded as necessary, it will be difficult for on-premise solutions to search and export data in the case of discovery requests.  With a SaaS solution, the solution provider takes care of the ongoing capacity planning and has the expertise to perform complex and time-consuming tasks such as migrating data to new technologies. SaaS companies, such as Fortiva, are big on R&D and are constantly looking for ways to make the archive better and they ensure that product upgrades are automatically applied without additional costs to the customer. In addition, SaaS solutions leverage the shared infrastructure of a multi-tenant SaaS architecture to provide access to hundreds of servers on-demand ensuring enterprise-grade search performance. In fact, Fortiva is the only company in the industry who backs up their search performance with a guarantee.

Basically, the implementation of an on-premise email archive is a significant commitment and undertaking for IT which only grows as the archive increases in size. Considering the management time, effort, and costs involved with an email archive, the decision to go with a SaaS solution should be an easy one.

SaaS vs Software for Vendors – Lesson #3: The Real Potential Lies in Business Model Innovation

Posted by Paul Chen, President, Managed Services

I ended my last post by discussing how at Fortiva, understanding our cost to serve helped us to improve our product and even introduce a new product offering. This leads me to my third and final lesson on the difference between SaaS and traditional software – business model flexibility.

The business model for traditional software is typically fairly straightforward – you create and develop it, produce it (on some type of media), and sell it to the customer either directly, or through a channel. From there, you typically have very little communication with the customer, with the possible exception of customer service.

SaaS businesses, on the other hand, have far more flexibility to adopt different business models, even taking advantage of more than one business model at the same time. This flexibility provides significantly more opportunities than traditional software to continually innovate and find new ways to leverage a product in different ways to improve revenues.

Let me give you an example. Google’s founders started out with a business model based on licensing their search technology to key portal vendors, such as Yahoo. Little did they know that just a few years later, they would introduce a keyword advertising program that would ultimately form the basis of Google AdWords, which today makes up the majority of their revenue. If they had stopped with the licensing business model, Google as we know it would not exist today.

Here’s another example – this time, a hypothetical one. At Fortiva, we charge a per-user licensing fee as well as a fee for blocks of storage to access our email archiving solution – essentially a pay-for-use model. But what if we decided to offer email archiving for free? It may sound crazy, but it could be a valid business model. Consider this – a large portion of businesses archive their email to meet requirements in the case of future litigation, and those businesses often have little need to access archived data before that time. Hypothetically, we could simply charge those customers to search and access their archives when litigation arises. This would give us the chance to target companies that don’t feel they can justify the cost of a pro-active approach to legal risk (by implementing an archive), while still benefiting in the long run from the inevitable.

I’m not suggesting that this is something we’re going to do, but it gives you an idea of the type of innovative thinking that can open up new business opportunities in the SaaS world.

At the end of the day, business model innovation can be a key competitive advantage for any company. SaaS opens the door to far greater flexibility in this area, and businesses embarking on this delivery model should not lose sight of that.

Read more on the SaaS vs Software: Lessons Learned series
Part 1 - Part 2 - Part 3 - Part 4

SaaS delivers SLA-backed solutions; Software delivers... just software

Posted by Craig Rennick, Founder and VP Sales

As a service provider of email archiving to enterprise customers, we pay great attention to customer service.  To this end, we talk to our customers frequently and schedule face-to-face senior level meetings to review our scorecard and get direct input on customer satisfaction. 

During our most recent road trip where I met some of our key customers, one of our customers summed it up perfectly when he said, “This is why we outsource to Fortiva, we want you stressing about this stuff – not us!”   Clearly we are upheld to scrutiny and standards that are beyond any one company’s capabilities to deliver in-house – and we expect that – I mean after all, why else outsource?   

In many of the calls I’ve been on, I continually hear about failed installations of on-premise software, like Enterprise Vault. What’s worse is that, I hear about them from prospects who have already invested time and money on software, built up a large archive, and are now having challenges keeping it running. And because change is difficult, IT administrators and users lower their expectations, apply band-aids and live with their situation. 

Then I think about Fortiva's customers and how they don’t need to tolerate unacceptable performance. They don’t need to accept less than desirable application effectiveness.  They also always have a provider working 7/24 to make things right and achieve industry leading SLA’s.  For example, Fortiva is the only provider in the email archiving industry that offers an SLA around search response time. To date, I have yet to come across an in-house IT department that would commit to any SLA’s for their own email archive.

No wonder we constantly hear extremely positive feedback from our customers.  Coming back from that week of customer visits, it reinforced why SaaS really is the wave of the future.  As a 15 year veteran VP Sales who now prescribes to SaaS for sales automation, I can see why IT will move in the same direction.

To SaaS or not to SaaS?

Posted by Fortiva Blog Editor

Over the past year, SaaS solutions have been rapidly pervading the enterprise space and the SaaS market has been heating up.  Despite this trend, you should keep in mind that SaaS only makes sense for certain types of situations and may not be suitable for every organization. 

So how do you know if SaaS is the right choice for your organization? The first step is to consider both the advantages and disadvantages of the solution, depending on the situation. (Note that not all SaaS solutions are created equal – when considering a specific solution, it is important to review each of the benefits and drawbacks of the solution under evaluation as they will not apply in every case)

Benefits of SaaS
One of the main benefits is the fact that since you do not need to purchase any hardware or additional infrastructure to set up a SaaS solution, you are saving on capital costs; the only cost is the ongoing operating expense every period. You only purchase services that you require and pay-as-you-go.  As such, your TCO is lowered. Also, because you do not have to install additional infrastructure, the implementation of a SaaS solution is quick, easy, and less expensive. Additionally, by having another party (the SaaS vendor) manage this aspect of your business, you are relieving your internal resources of this burden while at the same time enjoying the benefits of constant upgrades and full help-desk services that the vendor provides. Finally, since you are sharing computing resources with other SaaS customers, your users get on-demand access to this powerful infrastructure regardless of how frequently you need to access it.

Drawbacks of SaaS
Since SaaS solutions deliver the same general functionality to every customer, it may be difficult for you to customize your solution. As you run the SaaS solution, you may realize that there are some “add on” costs for additional items such as testing, support, storage, and integration that may not be apparent during the initial sales process. These hidden costs add to the total cost of the service and may make the solution expensive to run. Additionally, with up to 85% of SaaS solutions being sold directly to business units without the input of IT, there is a potential for businesses to make software decisions that cause problems in the long run in terms of integration with other systems, availability and corporate security requirements. Finally, you may also be exposing yourself to increased security threats by sharing your data with a third party vendor.

It’s important to note that not all business applications are ideal for SaaS deployments.  As we talked about earlier, it makes sense to outsource context applications to a SaaS provider so that the burden on your internal resources is relieved and your business can focus on its core functions. 

For several reasons, an email archive is one such business application that is best managed by a SaaS specialist rather than trying to manage it on-premise. For instance, being a storage-intensive application, an email archive takes a significant amount of time and effort on the part of IT to manage; moreover, the resources required – including both infrastructure and IT staff – continue to increase as the data in the archive grows over time. Having a SaaS provider manage this aspect of your business will free up valuable resources and IT time which could be better used towards your strategic activities. The key is to find the right SaaS email archiving provider – one that has all the benefits and is modeled to address the drawbacks mentioned above – to manage this aspect of your business.

SaaS vs Software for Vendors – Lesson #2: Never Lose Sight of Your Cost-to-Serve Model

Posted by Paul Chen, President, Managed Services

I’ve already talked about how different SaaS is from a traditional software venture, and I shared with you one of the lessons I’ve learned firsthand about running a successful SaaS organization (Fortiva) . Today I’m going to talk about another point that, from my experience, is a critical component to any successful SaaS venture.

I recently came across a very interesting guest post on Will Price’s blog, entitled Magic Number for SaaS Companies. The post is about a talk given by Josh James, CEO of Omniture, at this year’s Opsource Summit, which focused on something called the “Magic Number”. The basic theory is that SaaS companies can determine the health of their organization by measuring the increase in monthly recurring revenue and dividing it by the previous period’s spending on sales and marketing.

The theory is sound, and it’s a must read for all SaaS vendors; however, by focusing purely on sales and marketing, it misses a key metric for many SaaS vendors. In fact, just because you have a strong magic number, does not mean you necessarily have a healthy SaaS business.

Since any SaaS business, by definition, provides customers with access to a managed infrastructure, vendors will always have ongoing costs for backend hardware. This is quite different from the traditional software business where the cost of goods are largely upfront (and mostly involve the printing cost of the CD and user manuals). For some SaaS businesses, the infrastructure investment required will be quite high, and will be subject to change. This is the case at Fortiva, where we are constantly adding new storage infrastructure to support the archive growth of our current customers, as well as the needs of new customers.

This is one of the reasons why, over the past year, I have focused heavily on developing our cost to serve model. This model has helped us to understand and quantify exactly where our biggest costs are – and sometimes the results have surprised us.

By understanding and tightly managing our cost to serve, we have been better equipped to take advantage of both economies of scale and technological improvements (ie. cheaper storage). We’ve also been able to make small product fixes that have resulted in a significant impact on product performance as well as the bottom line…we’ve even been able to develop new product offerings that we otherwise might have overlooked.

The key point here is that unlike in a software business, where your cost to serve is a known entity (eg. initial development costs, media, packaging, etc), in a SaaS environment, that cost is subject to constant change due to new product features or technology changes. As a result, it’s critical that you place a significant focus on understanding the costs involved, how they change as the product evolves or adoption increases, and how you can optimize those costs to improve revenue margins.

Read more on the SaaS vs Software: Lessons Learned series
Part 1 - Part 2 - Part 3 - Part 4

What is the Difference Between Cloud Computing and SaaS?

Posted by Praising Gaw, VP Marketing

Recently, I’ve noticed that a lot of vendors have started talking about “cloud computing” in their marketing materials. In many cases they’re referring to solutions that were previously called Software-as-a-Service (SaaS), which begs the question – what is the difference between these two terms, anyway? Is “cloud computing” simply a new industry buzzword with no real meaning? Or is there actually a difference between the two?

Fortunately, the analysts at Gartner helped to answer my question with a recent report that clearly addressed just this issue. According to them, cloud computing is not just a buzzword; it does have a distinct meaning separate from SaaS.

The way I understand it, “cloud computing” refers to the bigger picture…basically the broad concept of using the internet to allow people to access technology-enabled services. According to Gartner, those services must be “massively scalable” to qualify as true “cloud computing”. So according to that definition, every time I log into Facebook, or search for flights online, I am taking advantage of cloud computing. However, neither of these examples would be considered SaaS.

While most (but not all) Software-as-a-Service solutions fall under the larger cloud computing definition as “massively scalable”, they also have a number of other defining factors. First, SaaS is software that’s “owned, delivered, and managed remotely by one or more providers.” It also “allows a sharing of application processing and storage resources in a one-to-many environment…on a pay-for-use basis, or as a subscription.”

So, with all that said, I can clearly state that Fortiva is a SaaS solution using cloud computing…but does it really matter? At the end of the day it comes down to how well the solution meets the needs of the user, both from a feature-functionality, as well as from a total cost of ownership perspective. Whatever you want to call it, the benefits of SaaS solutions go well beyond the buzzwords that may be used to describe them. Understanding that is much more important than getting caught up in the terms marketers use to try to get customers’ attention.

Welcome to SaaS, Nick

Posted by Paul Chen, President of Managed Services

Last week, it was announced that Nick Mehta, former general manager of Symantec's archiving product, Enterprise Vault, was appointed CEO of LiveOffice, a SaaS provider of messaging solutions, including email archiving. 

I must say that I am excited about the announcement.  I have spoken to Nick in the past and have found him to be quite knowledgeable in the email archiving space.  I admire him, not just as a competitor, but as a pioneer of our industry.  Under his leadership at Symantec, Enterprise Vault “crossed the chasm” and became the market leader in the on-premise email archiving space.

I’m sure Nick had many other career options after spending some time as an entrepreneur-in-residence at venture capital firm Trinity Ventures, but he chose to continue his career within the message archiving industry.  This tells me he believes what basically every industry analyst has been saying, that the industry we’re in will be growing by leaps and bounds for the years to come. 

What is even more exciting is Nick’s move from an on-premise solution to an on-demand email archive.  I see this as validation of what we have been seeing here at Fortiva, that growth in SaaS email archiving will far outpace the growth in on-premise email archiving over the new few years.  As Nick said himself in his new blog, he felt that “messaging and message archiving are universal needs and yet not every organization was equipped to run these systems themselves.”

As we have pointed out in previous posts, the nature of the problem that email archiving solves makes SaaS a great option for many companies – and any vendor that can provide a reliable and cost effective solution that takes the headache away from customers will definitely be leaders in the industry.

So, welcome back to email archiving, Nick.  You made the right decision betting on SaaS as the long term winner.

Wondering how you can afford to go green? Get your numbers straight.

Posted by Justin Wiebe, Fortiva Operations

Given my posting last month on green computing, I found the following statistic based on a new survey by McKinsey and Co. quite interesting.  Apparently, the world’s data centers are projected to surpass the airline industry as a greenhouse gas polluter by 2020.

In my previous post, I wrote about efforts taken by Fortiva to reduce our overall infrastructure power consumption. This has had the dual benefit of reducing both our impact on the environment and our cost of doing business. Since then, I have been thinking more about the challenges of justifying green computing from a dollars and cents perspective.

Until recently, I have rarely been able to create a positive Return On Investment (ROI) for new hardware purchases, especially those related to green computing. It turns out that all along I was missing something – that dollar amount that pushes the cost of existing systems over the top and reduces the payback to less than 3 years (sound familiar?). And what is that key? Power – more importantly, the cost of the power used over its lifetime by the piece of hardware you want to replace. As noted by Mark Monroe, Director of Sustainable Computing at Sun, rarely are power costs included in the IT budget.

Here at Fortiva, we try to roll all of our data center costs into one number. By adding up all co-location costs, power costs, cooling costs and miscellaneous data center costs (but not bandwidth costs) and then dividing this number by the useable power, we obtain the monthly $/VA  cost (or approximately $/W). By then determining the amount of power (VA or W) used by each server, we can calculate the cost per month to keep the server up and running. A sample of the calculation may look something like this:

Co-location Cost ($/VA) * Power Used by Server (VA ) * Server Life = Cost to Run Server

With the cost of power increasing almost everywhere, the Cost To Run Server is approaching the Cost To Buy Server. At Fortiva, the cost of hosting our dual-cpu servers for three years is approximately 75% of the total cost to purchase the server. If you stretch the life of the server out to five years, it actually costs more to host the server than to buy it.

So what should you do now? Try the following:

1 – Determine Co-Location Costs:

• Check your contracts. If you outsource your co-location facilities, you may be able to calculate the $/VA cost from your contracts.
• Talk to your finance department. If you manage your own co-location facilities, see if you can find out the costs of power, maintenance, security, on-call personnel, etc. Remember, your Co-Location Cost is the total of the costs to run the data center, divided by the useable amount of power.

2 – Determine Power Used by Server:

• Get yourself a good power meter and find out how much power your servers actually consume when idle and when under load. The numbers provided by the manufacturers tend not to reflect how you use the servers on a daily basis.

3 – Get out the spreadsheet and start crunching the numbers.

Try calculating the ROI on consolidating some of your existing servers onto virtual machines, or replacing some of your older machines with more energy-efficient models. You’ll probably be surprised by the results.

Hopefully these numbers can provide you with a better understanding of the true cost of your IT infrastructure. Who knows, they may also help you reduce your overall power consumption, justify some new hardware, or even help you justify outsourcing to someone who already has.

SaaS vs Software for Vendors – Lesson #1: Product Management Is Not Just About Features & Benefits

Posted by Paul Chen, President, Managed Services

In my last post, I talked about a number of traditional software vendors are now entering (or considering entering) the growing SaaS market. I also noted that while the two models (SaaS and traditional software) appear similar on the surface, there are significant differences between the two business models that require you to approach them in very different ways. Today, I’m going to share one of the three key lessons I’ve learned about building a SaaS business, and explain why in my opinion, it’s critical to success.

Before founding Fortiva, I started a company called FloNetwork, a very early example of a SaaS company that offered an email marketing automation service (FloNetwork was ultimately purchased by DoubleClick). Back then, one of our bigger customers came to us with a specific product feature request. It was a fairly basic addition for us, and something that we could easily pull together to make the client happy – so we did. Soon, a lot of other customers wanted the same functionality, so one by one, we added it for them.

Before long, we found ourselves with an operational nightmare on our hands. Since we made the change on a case-by-case basis, any overall product upgrades or backend changes required us to individually check and make fixes to those customers that had the feature in place – and each fix was slightly different.

Looking back, we could have avoided this problem by following a few simple rules:

1. Never offer “one-off” custom features
2. All feature changes should be developed with scalability and large-scale adoption in mind
3. Consider long-term support of any product changes
4. The product scope doesn’t end “at shipment” – it encompasses the life of the solution, including all operational and support requirements
5. Keep it simple

Unlike with traditional software, adding a feature is not simply a matter of identifying a customer need, building it, testing it, and deploying it. Instead, it requires a long-term approach that takes into consideration future support requirements, operational needs, scalability, and the potential impact on future product upgrades.

Ultimately, within a SaaS environment, the scope of all product management decisions should include the impact on the vendor – not just the impact on the customer.

Read more on the SaaS vs Software: Lessons Learned series
Part 1 - Part 2 - Part 3 - Part 4

Insights into Building a Winning SaaS Sales Organization

Posted by Craig Rennick, Founder and VP Sales

I’ve been working for SaaS start-ups for 10 years – a long period of time.  In fact before the term SaaS became in vogue we were called Application Service Providers or Managed Service Providers.  Regardless, at FloNetwork I drove sales to $30 million in revenue in less than 3 years and now at Fortiva we’re on a similar journey.  I’ve built sales teams for direct and channel and I’ve built the professional services teams in both environments.  I’ve learned a few things that I’d like to pass along what I hope will help you build a winning SaaS organization.

1. A track record of success in a service environment is the most important credential to look for when hiring people.  I’ve found that some people excel working together in a highly charged customer environment and some don’t.  I’ve made the mistake in the past of hiring senior talent with great credentials but who just couldn’t make the transition.  You’re usually better off to promote the winners you’ve already got as opposed to bringing in new talent.
2. Culture is critical and building an environment of passionate and like-minded individuals makes all the difference in the world.  In a SaaS organization we rally to the customer’s requirements – which never stop.  As much as we draw the line between hunters and farmers we all work together for a common cause – a great customer experience.  When someone’s people skills and conduct are less than professional and self-serving it takes its toll across the entire organization so make sure you deal with it quickly.
3. Reps need to be clever and intelligent.  Similar to sales reps at any organization they must be clever enough to learn the product and handle themselves in challenging customer situations.  However, I would argue that in a SaaS organization Reps need to have a higher sense of empathy, patience and appreciation for many more of the customer’s issues and concerns than in a pure sales environment.  SaaS reps cannot be programmed and trained and then sent to the field following the formula – it doesn’t work.  For a rep to excel in a SaaS company they must be well-grounded and rounded; they need to possess a level of intelligence that grasps many issues at once while always building a strong customer relationship overtime.  These are very special people – and difficult to find.

Note to Vendors: Please Help Us Be Green

Posted by Justin Wiebe, Fortiva Operations

I recently returned from a trip to Europe where I visited data centers in several countries. Almost everyone talked about the environment, carbon neutral computing and the possibility of governments starting to tax businesses based on their computing carbon footprint. This was a refreshing contrast to my experiences in North America where there is lots of press about ‘Green Computing’, but not too much action.

Here at Fortiva, we have been putting a lot of emphasis on minimizing our footprint. Not just because it is good for the environment, but also because the economics make sense. Over the past few years, we have managed to reduce our power consumption in a number of different ways:

• Using AMD processors and lower-power SATA drives has allowed us to reduce our power usage per GB stored from 0.2 W to 0.05 W
• Virtualization in our Development and QA environments has reduced the number of servers by approximately one-fifth. 
• Investing in remote management solutions reduces the number of visits we make to our data centers.
• And, as I opened with, we are looking into our vendor’s  ’greenness ‘.

Looking at this list of changes, it seems like we have made a lot of progress over the past few years. Unfortunately, it still feels like we have a long way to go. I have come up with a wish list of changes I would like to see our vendors make to help us achieve our goals:

• Ship less junk with each server:  For every server we receive, we probably throw away a third of the total weight shipped. Packaging, cable management kits, mounting brackets for non-standard racks, and documentation that no one reads goes directly into the dumpster. Some of our more enlightened data centers encourage recycling, but no one seems to take the time to sort the mess. Add the extra fuel used to ship the servers as a result of this excess weight, and eliminating these extras would save us all money.
• Act like a global company: One of our server suppliers recently announced that they will no longer ship a server purchased in Canada directly to a US address. What this means for us is that when we order a server for one of our US data centers, the manufacturer ships it from the US factory to our Canadian office, where we turn around and ship it back.
• Offer us older hardware:  Newer isn’t always greener – or even necessary. In many cases, we can use older, lower power consuming CPUs to power our storage servers. We just can’t get them.

I am sure there a lots of things I have left off this list that may make more sense for your company. Think about them, and the next time your vendor’s rep asks if there is any way they can help you, you’ll have something to share with them.

Time to switch? Why more companies are making the move from in-house to SaaS email archiving

Posted by Praising Gaw, VP Marketing, Fortiva

It seems that every month we hear from more and more potential customers that are looking for an alternative to their in-house email archive. Generally, these companies complain about how much time it takes to manage their archive, and the headaches it involves. From constantly-growing hardware requirements to long search times and even re-indexing of data in some cases, there's no shortage of reasons why we're getting calls from unhappy IT people.   

Making it worse, the headaches keep increasing as the size of the archive inevitably grows over time. So it's not surprising that for many companies that implemented an archive 2,3, or 4 years ago, things are just now hitting a "breaking point" - and that's when they approach us. Consistently, those organizations that conduct a full cost comparison of their in-house  archive vs. Fortiva come to the same conclusion: someone else can look after their archiving better than they can, at a cheaper price, and without the headaches.

This week, we announced a customer who came to this conclusion after spending months trying to fix the issues with their in-house solution. National Financial Partners (NFP), a national network of independent financial advisors consisting of over 180 owned firms, did a detailed cost analysis and found it was going be 18-20 percent cheaper on an annual basis for them to implement Fortiva rather than continue maintaining their original archive. On top of that, they could offload the many archiving issues they had to Fortiva, leaving their IT team free to focus on other initiatives.

It's an interesting story, and one that is worth reading if you're struggling with the decision of whether to choose an in-house archive or a SaaS solution. The full case study can be found here.

How Will You Conquer E-Mail Management?

Posted by Fortiva Blog Editor

This article, which appeared in this month's Integrated Solutions Magazine, offers a good overview of some of the concerns involved in e-mail management and the growing trend toward SaaS (Software as a Service) solutions to solve them.

Source: http://www.integratedsolutionsmag.com/index.php?option=com_jambozine&layout=article&view=page&aid=5709&Itemid=69

The continued explosion of e-mail leads to increased risk, threat, and cost. As such, managing e-mail has become a critical consideration not only for enterprises, but also for SMBs. Three industry experts recently discussed with me some of the concerns involved in e-mail management and the growing trend toward SaaS (Software as a Service) solutions to solve them.

E-MAIL MANAGEMENT TO MINIMIZE RISK
“At its most basic level, the term e-mail management refers to the ways in which end users and businesses store and organize e-mail information, including the many attachments that are sent by e-mail such as PDF files, spreadsheets, and word processing documents,” says Eric Goodwin, CEO of Fortiva. “Today, e-mail management involves the creation and enforcement of retention policies, the optimization of storage to ensure performance, compliance with regulations, and the timely search and retrieval of e-mail data for business and legal purposes.”

While the most publicized concerns of e-mail management revolve around regulatory compliance — most familiar are probably SOX (Sarbanes-Oxley), FRCP (Federal Rules of Civil Procedure), and HIPAA (Health Insurance Portability and Accountability Act) — the biggest risk factor comes from inside an organization. Improper use of company e-mail can lead to problems ranging from loss of intellectual property to violating privacy regulations. Quite often this occurs inadvertently, when an employee sends sensitive data outside of the organization without malicious intent. A simple example of this is an employee forwarding information to a personal e-mail account in order to continue working on the project while at home. Likewise, inappropriate content, such as offensive jokes, can circulate throughout a company’s e-mail system. Both situations put employers at litigation risk.

“Balancing employee privacy with the need to mitigate risk can be a difficult challenge,” says Chris Bradley, VP of marketing and business development at MessageGate. “E-mail control software uses predefined parameters and rules to look at the context and content of a message and only engages with the sender if they are at risk of engaging in unintentional e-mail misuse.” This type of software can alert the user when the ‘send’ button is pressed by displaying any violations contained in the e-mail. It provides an opportunity for the user to stop the e-mail before it is sent and therefore, before it becomes a legal business record. “Integrating e-mail control software with presend intervention demonstrates a reasonable effort should an incident occur, making it an important component in ensuring legal compliance and corporate responsibility,” says Bradley. Further, implementing user self-review solutions promotes employee responsibility by allowing them to determine the appropriate course of action.

An underlying component of e-mail management is accessibility. This is largely driven by the FRCP, which requires an organization to produce any e-mail related to pending litigation within 99 days. For this reason, storing e-mail properly has become a prime consideration. Simple, ‘bulk’ storage of e-mail has several inherent flaws, not the least of which is the space that e-mails can consume in any storage environment. Many companies think that simply storing all e-mails can satisfy the legal requirements of the FRCP. What they will find, however, is that although they may have stored the e-mails, they have no efficient means by which to search them. Locating a specific set of e-mails would be like trying to find the proverbial needle in a haystack.

OPT FOR ARCHIVE, NOT STORAGE
“Storage is a very broad term referencing the fact that data is being held. For example, e-mails can be stored on a user’s local hard drive, in a company’s e-mail server, or on tape backups,” says Matt Smith, president of LiveOffice. “However, none of these options is considered to be viable for long-term, tamper-proof storage, which is where archiving comes into play.” Archiving refers to more than just storing data. It requires data, in this case e-mail messages, to be copied or moved to a secondary location. This relieves the space burden of the company’s primary storage solution, enabling long-term storage of e-mail that can still be accessible at a later date.

“Effective archiving systems are disk-based and able to store extremely large amounts of e-mail for long periods of time, without the threat of the data being corrupted,” says Smith. “In addition, good archiving systems are backed up in multiple, geographically disparate locations, ensuring the availability of data at all times.”

Fortiva’s Goodwin goes on to explain the importance of archiving. “There is some confusion around this term [archiving] because it can be used to refer to everything from ad hoc end user ‘archiving’ to formal archiving for corporate purposes,” he explains. Common platforms, such as Microsoft Outlook and Exchange, give users the option to "archive" e-mail by saving it as a PST (personal folder storage) file on their desktop computers. While this removes the data from primary storage on the Exchange server, leaving it accessible on the user’s computer does not qualify as active archiving. “An active archive [the definition used by most analysts] involves indexing  information, enforcing retention policies, and preventing deletion or alteration of e-mail until a predetermined disposition date,” continues Goodwin.

Most companies take one of two approaches to e-mail archiving: save all or save nothing. Both strategies have inherent flaws. “Saving all e-mails means that messages quickly add up and increase storage requirements — along with the number of useless e-mails that still must be recovered and analyzed during e-discovery. Meanwhile, saving nothing means companies will be unable to provide requested and necessary documentation when litigation occurs,” says Bradley. Arguably the best solution to this conundrum is e-mail archive categorization. This type of solution enables an organization to establish retention policies based on specified business rules. In the same manner as a user would establish document categorization through the use of keywords, an e-mail categorization tool will use keywords, position titles (such as CEO or manager), departments (like HR or accounting), and so on to categorize e-mails into the proper retention cycle. In this manner, a company can establish longer retention periods in an archive for regulated communications than those established for personal e-mails and insignificant correspondence.

OPT INTO HOSTED E-MAIL MANAGEMENT
“According to recent analyst reports, growth in hosted solutions overtook that of on-site e-mail archiving solutions in 2006, and we expect that trend to continue,” says Goodwin. “Both IDC and Gartner analysts have made similar predictions, and our experience certainly backs that up.” SaaS solutions can be deployed quickly and cost-effectively and eliminate the need for purchasing additional hardware or software to accomplish effective e-mail management. In addition, hosted e-mail management solutions can provide the redundancy of multiple data centers in geographically dispersed locations, addressing disaster recovery concerns while still removing the burden of monitoring and archiving e-mail from internal IT staff.

“Organizations with between 1 and 1,000 mailboxes are embracing hosted message management systems,” says Smith. “We are also seeing increased interest from larger enterprises.” Historically, these organizations have been hesitant to outsource their e-mail management, but with message volumes growing exponentially each year, CIOs and IT managers are beginning to turn to SaaS solutions as a cost-effective option for alleviating the resource-heavy administrative tasks associated with e-mail management.

Cost savings can be a big consideration, especially when you factor in the questionable stability of today’s economy. “If the United States heads into another recession, corporations will likely rein in information technology spending, and consequently, software companies will potentially suffer,” says Smith. “Vendors that offer SaaS solutions, however, will continue to thrive.” In fact, Gartner predicts that from 2007 to 2011, the overall growth rate of SaaS will double that of enterprise software as a whole. SaaS can help users meet their technology needs by supporting vital functions, such as e-mail management, at a fraction of the cost of running an in-house system. In addition, the fixed monthly expense of a SaaS solution helps users control overhead while also eliminating the need to carry nonrevenue-generating assets, such as in-house hardware or software.

While hosted solutions are a cost-saving and IT resource-saving option for enterprises, the impact can be even more beneficial for SMBs due to the lower cost per user. SaaS offerings enable SMBs to benefit from e-mail management features that have typically been implemented in-house by Fortune 500 companies with expansive IT budgets. Additionally, opting for SaaS-based e-mail management solutions can keep an organization, whether SMB or enterprise, consistently upgraded as these solutions evolve, without requiring significant out-of-pocket expenditures.

“Addressing e-mail management with messaging audit, presend e-mail controls, and categorization tools before it enters the archive can increase overall operational visibility and reduce risks created by e-mail. Additionally, companies can effectively adhere to new e-discovery requirements in a practical, affordable, and responsible manner,” says Bradley. As businesses continue to recognize the need for e-mail management, archiving solutions that support end user access will become commonplace. Hosted solutions will shift the burden off end users while continuing to protect  users from legal and business risks.   

Reducing the Risks, Costs and Time of e-Discovery: EDRM and Email Archiving

Posted by Rick Dales, VP Product Management

This week I participated in a live webcast at Fortiva that discussed how an email archive can reduce the cost, risk and time involved with e-discovery. I thought it might be helpful to share some of the ideas from that event here on the blog.

A lot of people use the Electronic Discovery Reference Model (EDRM) to explain the steps involved in the e-discovery process. Since having an email archive significantly changes how a company deals with the first four phases of the model, I’m going to focus on those areas (as they pertain to email). First, I’ll explain what each step involves, and then provide a general sense of the time and costs involved (with and without an email archive).

Ultimately, as the diagram below shows, having an email archive in place can dramatically reduce the costs involved with e-discovery, not to mention the risks.

1. Information Management – This is the first step in the model, and it refers to the organizing of information and the application of consistent retention policies. 
   

   Today, most firms have poorly defined retention policies and little, if any, way to enforce them across the organization. As a result, most companies dedicate very little – if any – budget to this step. The problem is, with no enforced policies, businesses are at risk of spoliation from destruction of data that should have been retained during a lawsuit. They also may be exposed to excess legal risk by maintaining data beyond the retention policy.

   By adding an email archive which captures a copy of every email message and applies consistent retention policies, a company can avoid these risks. Proactively capturing email into a central, searchable repository also increases visibility, and allows legal counsel to conduct early case assessment. It also makes future steps in the EDRM process faster and less expensive.  However, adding an archive requires a company to dedicate a moderate budget amount upfront.

2. Identification – This step basically involves determining where – and in what format – email exists.

   Without an archive, this may require IT to find and catalog backup tapes, PST files (on the corporate network, individual laptops and desktops, and portable storage devices), and email servers. The hard costs are generally fairly low, but the time and effort required by IT can add up significantly.

   By adding an email archive, this step can essentially be eliminated, especially if a company takes steps to eliminate the use of PST files. Since all email is stored in the archive, it is a single source from which all e-discovery requests can be met.

3. Preservation & Collection – Preservation means ensuring that email is protected against destruction or alteration (generally after a litigation hold), while collection refers to the gathering of email from the various sources catalogued in the identification phase. These two steps can sometimes overlap.

   Without an archive, enforcing a litigation hold manually (by asking individuals to retain information) is a hit or miss situation. Even if you can ensure that all relevant information is preserved (ie. by storing complete backup tapes), you will almost always end up retaining more data than necessary – potentially exposing the business to additional risk.

   With an archive in place, the preservation & collection process is radically reshaped. With all data stored in a central location, there’s no need for collection at all. The archive also allows you to easily enforce a preservation/hold order for only the data required, without risking additional data deletion/spoliation of evidence (in Fortiva’s case, a litigation hold can literally be enforced with a click of a button).

4. Processing, Review & Analysis – This phase involves the preparation of data, as well as the review and analysis of that data. This is where the most dramatic time and cost-saving benefits can be achieved with an email archive.

   Without an archive, this generally involves restoring backup tapes and removing duplicates, which can be an extraordinarily expensive process (the average cost to restore a single backup tape is $2,500 and some businesses may have hundreds of tapes to restore). This is also when the initial culling process takes place - eliminating unnecessary documents in order to reduce the amount of data that needs to be manually reviewed. Since processing work is typically done by third parties with limited culling capabilities, the resulting dataset that needs to be reviewed is generally very large.

   With an archive in place, all the data is stored in a deduplicated fashion, and it can be searched and reviewed at any time.  This allows businesses to conduct early case assessment before meeting with opposing counsel (or even before a formal case is filed).  A powerful search feature also makes the culling process more effective, ultimately reducing the amount of data that needs to be reviewed and analyzed.

5. Presentation – Since theoretically, the same dataset will be produced following the first four stages, an archive has no material impact on production and presentation costs.

As you can see in the diagram above, an archive involves moderate incremental costs in the information management phase (regardless of whether or not you’re involved in litigation); however, it dramatically reduces the total cost of the e-discovery process when a request comes up. Ultimately, even if you only have one case that requires e-discovery over the course of three years, it still makes economic sense to implement an archive (based on Fortiva’s pricing). This is true without taking into consideration the additional risks (and potential costs) that come with not having an archive in place.

SaaS vs Software – Two Fundamentally Different Business Approaches

Posted by Paul Chen, President, Managed Services

It’s clear that Software-as-a-Service is continuing to grow, and as a business model, it has the potential to be very profitable. According to Gartner’s estimates, by 2011, 25% of new business software will be delivered as SaaS. Compare this to their assessment of traditional software licenses, which Gartner says have been stagnant for the past 36 months, and you’re left with a very healthy outlook for the SaaS market.

This recent growth has led a number of companies (and individuals) to consider developing a SaaS-based solution. As part of the decision process, there is often a significant focus on how long it will take, and how much capital is required to build and market a successful, profitable SaaS solution (particularly in comparison to traditional, licensed software solutions). This comparison will almost always lead to a conclusion that SaaS is more expensive, and takes longer than traditional software to reach a point of profit.

While these are important metrics to consider, the way I see it, the real question is not, “how much will it cost”, but instead, how do you “do it right” to help ensure success (and the profits that come with it)?

I am not claiming to have all the answers, nor do I think there's only one right way to build a successful SaaS business . I do, however, know that there are a lot of important issues that are overlooked by many people entering the space, especially when they’re coming from more traditional software markets. While the two models (SaaS and traditional software) appear very similar on the surface, I would argue there are a lot more differences between them than similarities. When you consider that, approaching the two business models in the same way does not make any sense.

Fundamentally, the switch to a SaaS model requires you to first understand that SaaS is not simply another delivery mechanism – it’s a paradigm shift that affects virtually every department in the organization. To be truly successful, a SaaS-based offering needs to be built from the ground up as a service, rather than a product. Every business decision should be made with this in mind – from product feature decisions to sales and marketing efforts.

In my next posts, I will share with you the three biggest lessons I’ve learned building a SaaS business, and explain why these three things are, in my opinion, critical to the success of any SaaS initiative.

Read more on the SaaS vs Software: Lessons Learned series
Part 1 - Part 2 - Part 3 - Part 4

Building a Successful SaaS Business – Lessons Learned

Posted by Paul Chen, President, Managed Services

As a founder of Fortiva as well as an earlier generation SaaS/ASP venture (FloNetwork, which was sold to DoubleClick), I have a number of years’ worth of experience in the Software-as-a-Service space. Looking back on the mistakes and successes of both companies, I realized there are some important lessons that I (and the team that I’ve worked with) have learned over the years. With the growing interest in SaaS, it seemed like a good time to share some of those insights.

Over the coming weeks, I will discuss some of the key issues we faced in starting a SaaS venture, from understanding the differences between building SaaS compared with traditional, licensed software-based solutions, to the importance of an engineering product roadmap and achieving economies of scale. I will also share with you some of the best practices we learned through trial-and-error, as well as some things we would have done differently. I welcome your thoughts and feedback.

SAS 70 Type II Certification – A Key Metric for SaaS Providers

Posted by Jeremy Hope, VP Operations

Security remains one of the biggest concerns that IT professionals have when a considering Software-as-a-Service solution. As a result, one of the most significant challenges that a SaaS provider must overcome is establishing a high degree of trust that customer data is safe in the vendor’s hands. There are a number of ways to do this, but one of the most important metrics that customers look for is the Statement of Auditing Standards No. 70, Services Organizations ("SAS 70") Type II Certification.

At Fortiva, we formally announced today that we achieved the SAS 70 Type II certification. SAS 70 is an internationally recognized auditing standard developed by the American Institute of Certified Public Accountants that validates that a service organization has been through an in-depth audit of its control activities, and demonstrates that they have adequate controls and safeguards when they host or process data belonging to their customers.

As anyone who has gone through this knows, it’s a long, drawn-out process that takes a serious commitment on the part of the service provider. However, it is one of the only independent/third-party metrics a customer can look for in order to establish a level of confidence. As a result, it’s an invaluable tool for SaaS providers and one that is worth every bit of the time and effort required to achieve it.

At Fortiva, we always say that maintaining the integrity, privacy and security of our client’s data is our most important goal. To achieve this, we are constantly reviewing our processes and improving them – but most of this happens “behind the scenes”. Achieving the SAS 70 Type II Certification is an important way for us to demonstrate the care and attention we place in this area.

Microsoft to Expand Microsoft Online Services for Businesses of All Sizes

Posted by Eric Goodwin, CEO

An exciting announcement came out of Redmond today saying that Microsoft Online Services will be extended to enterprises with fewer than 5,000 employees. Last September, Microsoft announced the worldwide availability of Microsoft Online Services for businesses with more than 5,000 users (known as “dedicated offerings”). According to the release, today’s announcement extends the same performance, scalability, security and service level capabilities to all businesses.

As the email archiving provider for Microsoft Online Services dedicated offerings, we are obviously happy to see Microsoft bringing their “software plus services” to a wider audience. Regardless of that, this announcement is a good thing for businesses that want the benefits that Microsoft’s Exchange, Sharepoint, and Office Communications products offer, but don’t want to dedicate significant internal IT resources to make that possible. At Fortiva, we’ve spoken numerous times about the difference between “core and context” applications, and how context applications are ideally suited for SaaS delivery, allowing businesses to focus on their core applications. Since all of these applications fall squarely in the “context” category, Microsoft’s Online Services can open the door for businesses to focus their resources on core areas that can make them more competitive – and that can only be a good thing for business.

To view the full release, click here. http://www.microsoft.com/presspass/press/2008/mar08/03-02AllSizeBusinessesPR.mspx

SaaS on top of SaaS - Why it's a good thing

Posted by Chris Tebo, CTO

Last week, Phil Wainewright featured a column by Greg Olsen of Coghead on his SaaS blog. Olsen's column, titled, How Not to End Up as an Anachronism, presented the argument that to be truly disruptive (and successful), SaaS vendors must build their applications “on top of” infrastructure as a service.

It’s an argument that aligns with my experience and thoughts on where SaaS implementations are heading…after all, SaaS solutions excel by specializing in a particular area, allowing them to offer the best product at the best price. This, in turn, can relieve a customer’s resources, allowing them to focus on their core areas and improve their ability to compete in their market (see Eric Goodwin’s explanation of core vs. context applications). The notions of core and context apply equally well to SaaS providers.

Let me give you a concrete example. All SaaS providers at the end of the day get paid based on the service they provide, so billing is a key function in any SaaS solution.  Should a SaaS provider spend their precious product development resources building the latest and greatest billing solution?  Of course not…there are potent in-house and SaaS solutions out there to solve the billing problem. In simple terms, could you build a better billing system that would win you more business and make your customers happy? The answer is almost certainly no, putting that application squarely in the “context” category.

At the other end of the spectrum, that very same product development team needs to look at opportunities where they can “build the best product in their space” by focusing their energies on very specific problems.  This identifies “core” to the SaaS provider.  At Fortiva, the core is very clear.  We are focusing our energies on securely storing Terabytes of data on a long-term basis for our customers, while providing the richest, fastest search access to that data.

Getting back to Olsen’s article, it’s interesting to see the opportunities that solutions like Amazon S3 and EC2 provide.  I’ve written about them before… they truly are game changers. Why?  Because they can make the physical infrastructure and the servers themselves context for the SaaS provider, allowing them to focus their resources on building a better core product – and that’s ultimately a good thing. 

As is always the case with progress, there are going to be some bumps in the road before all of this infrastructure is ready to support SaaS providers of all shapes and sizes.  You just need to read about the backlash from last week’s EC2 outage to understand why we couldn’t rely on this service for our customers today.  Nonetheless, we’ll all be better able to solve the “core” challenges at the heart of our SaaS solutions as these “context” problems are addressed by others.

How SaaS Keeps Sales Honest - Honest Product Representation (Part 2 of 2)

Posted by Craig Rennick, Co-Founder and VP Sales

As VP Sales at Fortiva I oversee all prospect and customer contact; the sales process and then the on-going customer relationship falls into my camp. This means that we directly have to deliver, on an ongoing basis, what we sold. Expectations are set by us and then measured by our actual performance - ongoing.

Compare this to software vendors who make the sale and them move on. If you require training, help setting up and configuring the application, or if six months into the implementation you throw your hands up in desperation and call for on-site help it will cost you – big time. And then you’re into that familiar trap of throwing good money after bad in an effort to get the service running as it was demoed and promised during the slick presentation and sales push.

As a SaaS provider our pricing is all-inclusive and our work begins once we’ve made the initial sale. As a customer, you never lose the leverage you had as a buyer.  After the sale we monitor and support your business 7/24, we’re responsible for bug-fixing, upgrades, new releases and for adding those features that we promised we would during the sales process. Our pay-back comes over the long-term; our business model demands that we keep you a happy customer so that we make our margins over the long-haul.

Selling SaaS requires a different mind and skill-set than selling software. For us, customer relationships are on-going; we get closer to our customers than a software vendor ever would. As a SaaS provider we have to be totally upfront and honest with our prospects – it’s a new and refreshing paradigm that benefits buyers immensely.

When Does SaaS Make Sense? Core vs. Context Applications

Posted by Eric Goodwin, CEO

The benefits of Software-as-a-Service (SaaS) – from ease-of-use to lower cost of ownership – have been well publicized over the past few years, partly as a result of the success of companies like Salesforce.com. This increased attention has resulted in the SaaS model growing in both awareness and popularity among North American businesses. In fact, analyst firm Gartner Inc. is projecting a compound annual growth rate of 22.1% for the SaaS market through 2011. 

Despite the growth and the hype surrounding it, SaaS is not well-suited for every application. So that leaves many asking the question– how can I distinguish those solutions that are best suited for SaaS from those that I should keep in-house?

At Fortiva, we often explain this distinction in terms of core systems and context systems, a theory that was introduced by Geoffrey Moore in his book, Living on the Faultline: Managing for Shareholder Value in Any Economy. According to this interview with Cisco Systems, Moore explains the core vs. context basics in this way:

The word “core” in business has typically been used to describe what you are distinctively competent at. We’re actual