The role of the system integrator is changing and soon we will see a move to them becoming SaaS providers.
That’s according to Nigel Shaw, Vice President, Head of Business and Application Services in UK & Ireland at Fujitsu.
To back this up Shaw detailed four companies that Fujitsu has acquired in the past three years; French software firm UShareSoft which was acquired in November, US IoT sensor company GlobeRanger, UK company ACT that deals with digital ticketing solutions and RunMyProcess which is a French based cloud service provider.
The acquisition of RunMyProcess added the integration of Platform as a Service to Fujitsu’s cloud portfolio.
What these buyouts highlight is a growing trend for the company to equip itself with software solutions as Fujitsu looks to better position themselves in a hybrid world.
Shaw, said: "I think in this hybrid world what you will see is increasing numbers of SI’s providing SaaS solutions.
"The lines are becoming more blurred between the software owners and the service providers."
This raises some questions, as surely this move would make them competitors with the software companies that they have been working with in order to integrate their technologies into businesses.
Shaw doesn’t believe that it will hurt relations, citing the strong relationships that Fujitsu has with the likes of Oracle, Microsoft and ServiceNow. He explained that for a company like ServiceNow, it wants to implement the technology widely, but it has a limited services capability. So having someone like Fujitsu on hand helps to improve the reach of the software.
At the other end of the scale, Oracle has large service capabilities but they still need Fujitsu: "Someone like Oracle, really have very large service capabilities, they know for the largest clients they still need a hybrid world and they see us as being able to meet those hybrid demands," said Shaw.
Despite this, Shaw does admit that there will be some areas of conflict: "So whilst we recognise there are some areas that we are going to compete I think by and large it’s still a partnership world for us."
You shouldn’t expect to see Fujitsu competing head-on with any of the big players in the SaaS market, its acquisitions are focused more on niche or particularly specialist areas, which are something that clearly the company feels it can compete in.
One of the driving forces behind this is hybrid cloud and the realisation that to make sure regulations and compliance are met, some data needs to remain on-premise.
This is something that SaaS providers are evolving to understand, so for example you see more UK based data centres that meet any data residency concerns.
Shaw, said: "That’s kind of cloud growing up, recognising that these things do have big businesses significance, it’s not just about whacking everything in the cloud and getting on with it, you have to consider these things, directors are legally responsible."
Of course it should be noted that Fujitsu isn’t alone in responding to the challenge of hybrid, other players such as Accenture, CSC and Hitachi offer SaaS applications in varying degrees.
The point being that if Fujitsu wants to position itself as more than an SI, but an SI that delivers SaaS, then it has plenty of competition out there, let alone from the SaaS providers.
The challenges of the SI world continue when you consider that not every business will require their services. Some will buy the software and have enough in-house capability to implement it themselves, but this is typically for more vanilla implementation which is a shrinking market with more niche players.
This, Shaw says is not the real future for an SI: "It’s not the real future for an SI just doing that and if customers want to go direct that’s fine."
In addition to becoming a SaaS provider, the company aims to offer client consulting before the client even approaches the likes of Salesforce about their technology.
"So it’s more the upfront professional service world that we’ll do and there’s definitely still a strong requirement for that," he said.
The traditional role of the SI is to mesh together the different components so that they play nicely together and if the SI does its job correctly then the different technologies can be presented as a seamless solution that the users don’t have to know or even care about.
Another function that the SI has is that of customisation, particularly as larger enterprises, "culturally find it quite difficult to take the standard product," he said.
While Oracle, Microsoft and SAP may typically see mid-market and smaller companies taking the standard product, the SI sees its enterprise level clients finding the standard product a little frustrating.
Shaw said: "They will buy the standard but they do find it a little frustrating and we do have to do quite a lot of customisation around that to meet their needs."
The problem is that providers of the software typically want to appeal to as broad a market as possible so it can be difficult to tailor to one industry.
This is where the SI comes in with the ability to tailor to specific industries by using extensive market expertise and by understanding the requirements of, for example, transport, local government or financial services.
While it is an important element of their job, the customisation of SaaS products can lead to points of tension. The tension is created particularly in standard cloud models where the client wants the software to be more flexible than it can be.
"The very nature of that SaaS module is that you are buying quite a bit of standardisation," he said.
One way around it that some SaaS companies are using is to provide individual instances for clients that provide the level of customisation the customer requires and gives them the ability to depart from the standard.
But if a problem happens in a heavily customised solution, whose problem is it?
"For us that’s one of the great advantages of the SI, if they’ve done the customisation they (Sis) have to take support responsibility and that’s what we do," he said.
That does come with a catch though and that is the expense, with the support for high levels of customisation being more expensive.
Shaw said: "You pay for the customisation you have to pay for the support, but if it’s right for your business it’s the right thing to do."
What we can see is that while Fujitsu has goals of providing SaaS elements, this is likely to be in specialised areas that won’t see it clashing too much with any of the big players that it has alliances with. The success of this will be based on building its portfolio of offerings.
Where Fujitsu has a trump card is that it doesn’t have to start from zero on the reputation front, it has already earned itself a position as one of the leading system integrators, so earning trust in the SaaS market shouldn’t be too difficult to come by.
This is particularly helped by the fact that it knows how everyone’s software works, so it should in theory be able to develop solutions that are among the best.