In what is sure to be perceived as a somewhat controversial post. Mark Evert Hall presents the argument that SaaS hurts a fragile IT economy. Why - because you need fewer IT staff members to support your operations when you subscribe to existing service. In the short term, he is concerned that instead of reallocating resources, cost conscious managers will simply use Cloud Computing to reduce headcount. He says:
“Of course, SaaS vendors couch their labor-reduction sales talk by saying that you will be able to put those people and systems to work doing something more productive or urgent. But you know that it allows you to cut heads. And in today's economy, that's just what you'll do because the most urgent and productive thing an IT executive can do in 2009 is reduce headcount. “
Even with his concerns, I did not take this article as negative. The staff reductions will challenge companies to be more productive, and make better use of employees. It will also challenge individual team members to "raise their game." The reality is during times of economic downturns, we see tremendous innovation as some of the best players are displaced and turn their talents toward new innovative ideas. For these innovators, inside large companies or small start-ups (without significant human or capital resources) access to SaaS and IaaS through cloud computing and virtual servers will accelerate innovation. Hall sums it up when he says:
“…it will be a god-send choice to launch new business initiatives and to quickly gain competitive advantage in an expanding market. “
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