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TOWARDS A FRAMEWORK FOR DEFINING AND CATEGORISING BUSINESS PROCESS-AS-
A-SERVICE (BPAAS)
T. Lynn, N. O’Carroll, J. Mooney, M. Helfert, D. Corcoran, G. Hunt, L. van der Werff, J. Morrison,
P. Healy
Irish Centre for Cloud Computing and Commerce
Dublin City University
Dublin 9, Ireland
e-mail: theo.lynn@dcu.ie, noel.carroll@dcu.ie, John.Mooney@pepperdine.edu, marcus.helfert@dcu.ie,
david.corcoran@dcu.ie, graham.hunt@dcu.ie, lisa.vanderwerff@dcu.ie, J.Morrison@cs.ucc.ie,
p.healy@cs.ucc.ie
ABSTRACT
This paper studies a fourth emerging service model of cloud computing, Business Process as a Service
(BPaaS). BPaaS is generating hype but it is under researched with a lack of clarity regarding how BPaaS
differentiates itself from other service models and what opportunities and challenges it presents for
management and organisations attempting to implement it. In this paper we examine the theoretical
underpinnings of BPaaS with a view to developing an understanding of the potential value of adopting the
BPaaS model and its implications for the realisation of business value from cloud computing. We develop the
SEIFS framework (Situation, Elemental, Integration, Flexibility, and Scalability) to provide guidance in the
classification of cloud services as BPaaS or otherwise and attempt to validate this framework by using a
series of case studies based in Irish cloud computing firms.
Our paper aims to contribute to the literature by addressing confusion in the classification of cloud services,
and specifically BPaaS. We also provide insights for prospective BPaaS providers to factor into their service
design and discuss how BPaaS can provide a competitive advantage. Finally, we identify and discuss a
number of areas for future research.
INTRODUCTION
Cloud computing is radically transforming the IT industry (Mikkilineni and Vijay, 2009). New service
provisioning models and concepts have emerged and evolved throughout the business landscape (Buyya et al.
2009). As a result, there is a need to incorporate new methods to successfully guide the analysis, design,
deployment, and use of cloud computing strategies and applications (for example, Weinhardt et al. 2010).
For the purpose of this report, we use the US National Institute for Standards and Technology (NIST)
definition of cloud computing namely:
“…a model for enabling convenient, on-demand network access to a shared pool of configurable
computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly
provisioned and released with minimal management effort or service provider interaction.”(Mell and
Grance, 2009)
Mell and Grance continue to define cloud computing in relation to five essential characteristics, three service
models and four deployment models as outlined in Figure 1. The three service models included in the
traditional framework are software as a service (SaaS), platform as a service (PaaS), and infrastructure as a
service (IaaS). SaaS is when software is delivered through the cloud with the consumer typically using a thin
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client interface, most often a web browser, to access the providers‟ applications. PaaS sees the provision of
networks, storage and other services to host consumer‟s applications. Finally, IaaS sees providers supplying
consumers with fundamental computing resources such as storage and networks.
Figure 1 The NIST Cloud Definition Framework
This paper examines an emerging fourth service model (see Figure 2), Business Process as a Service
(BPaaS). BPaaS offers packaged or predesigned business services that may in turn be reused by different
service applications, service providers or business processes (Slaa, 2011). While BPaaS is “generating more
hype as it is slowly emerging on the market for services” (Stoitsev and Grefen, 2012; p. 11), little research
exists which examines the nature of BPaaS. As a result, it is unclear how BPaaS distinguishes itself from
other service models and what opportunities and challenges exist for organisations attempting to adopt it. In
this paper, we examine the theoretical underpinnings of BPaaS with a view to developing an understanding of
the potential value of adopting this model and its implications for the realization of business value from cloud
computing. We identify the essential characteristics of BPaaS and describe what distinguishes it from SaaS
and other cloud service models. We also discuss how BPaaS can provide competitive advantage to BPaaS
providers and adopters. Through a series of mini-cases, we identify opportunities and challenges that may
inform a future research agenda.
Figure 2 The Cloud Service Model Stack
BUSINESS PROCESS STREAMS
The availability of process technology has grown significantly over the past two decades. Central to process
technology is a business process, a set of specific tasks organised to achieve an intended goal. Davenport and
Short (1990) define a business process as “a set of logically related tasks performed to achieve a defined
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business outcome.” In addition, Hammer and Champy (1993), state that a business process “is a collection of
activities that takes one or more kinds of inputs and creates an output that is of value to the customer”. In
more recent years, Papazoglou and van Den Heuvel, (2006) define a business process as:
“an aggregation of aspects that include where the process starts and ends, the typical customers (users) of
the process, the inputs and outputs that the customers of the process expect to see, the external entities,
e.g., suppliers or logistics providers, that the process is expected to interface with, and the different types
of events that start an instance of the process”.
The concept of a business process has numerous intertwining and related concepts that describe how business
activities are executed and managed. From the three definitions outlined above, we can identify that a
business process is an organised sequence of activities designed to achieve an intended business outcome.
Business process may be categorised as:
1. Operational: executing the core business process and monitoring the functionality of processes to
generate business value, for example, sales;
2. Supportive: supporting core processes to enable process execution and process completion, for
example, accounting.
3. Managerial: providing coordination and oversight by setting and achieving goals through specific
processes;
Our study has identified a number of different research streams that can contribute to the understanding of
BPaaS. These include business process automation (BPA), business process management (BPM), shared
services, business process outsourcing (BPO), and business process utility (BPU). The contribution of each of
these research streams will bediscussed in the remainder of this section.
Business Process Automation (BPA)
Over the last two decades, business processes have been widely studied across the management literature,
with numerous contributions to understanding, modelling and optimising these processes. In particular,
business process automation (BPA) has proven to be a significant development in the management and
technology fields. The application of technological solutions to business needs quickly demonstrates the
many business benefits including defined and seamless execution of processes, reduced costs, and improved
process quality. In essence, organisations automate their business processes to improve operational efficiency
and reduce human error. BPA presents a defined approach to execute a collection of business process
activities to generate a specific output. BPA is the technology-enabled automation of specific actions within a
service that accomplish a defined function within a workflow. According to Dayal et al. (2001), BPA is an
approach to:
“improve operational efficiencies and reduce error, but commercial business process management
middleware lacks tools for quantitatively tracking these business metrics”.
BPA offers organisations a strategy that integrates systems to reduce costs using software applications. BPA
is a cyclical approach that analyses, documents, optimises, and automates business processes. Each stage of
the BPA cycle generates value-added activities that contribute towards the finished product or service. BPA
invites managers to identify steps within a workflow that might be repeated in a cross-functional area and
implement a technological solution to increase service efficiency. Typically, the end-user is granted access to
several functions through a single interface using BPA software. However, it is worth noting that the goal of
BPA is to not only to automate business processes, but also to simplify and improve business workflows of
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service operations. Therefore, BPA can also be part of an overarching process improvement within a process
management strategy.
Business Process Management (BPM)
Business process management (BPM) may be described as a key component of workflow infrastructure
management that maintains and optimises core business functions. BPM defines how processes are
collectively managed to improve efficiency and agility while reducing human error. Elzinga et al., (1995)
define BPM as:
“…systematic, structured approaches to analyse, improve, control, and manage processes with the aim of
improving the quality of products and services.” Zairi (1997) provides a functional definition of BPM as,
“…a structured approach to analyse and continually improve fundamental activities such as
manufacturing, marketing, communications and other major elements of a company’s operations”.
The „value‟ of BPM was captured in the Lee and Dale (1998; p. 219) case study as a method of “measuring
the core processes, analysing what works and what doesn’t and improving them”. They identify three critical
factors which contribute to the success of BPM - process discipline (i.e. correct and consistent application of
business processes), process improvement, and cross-process integration.
The concept of value-driven processes often refers to services within a business network that execute a
business process to produce economic value while monitoring cost, quality and time parameters. Thus, BPM
may be described as a management discipline that treats processes as assets that directly contribute to
enterprise performance by driving operational excellence and business process agility (Gartner, 2012). To
support BPM practice, there are numerous proposed methods, policies, metrics, management practices and
software tools to optimise organisational performance including, business process management notation
(BPMN), business process execution language (BPEL), event-driven process chain (EPC) and extended
business modelling language (xBML). What differentiates BPM from previous process management
approaches is its emphasis on process agility and continuous optimisation.
Shared Services
“Shared services” is an approach whereby a service is provided by a specific part or function of an
organisation. Shared services may be defined as:
“a collaborative strategy in which a subset of existing business functions are concentrated into a new,
semi-autonomous business unit that has a management structure designed to promote efficiency, value
generation, cost savings, and improved service for the internal customers of the parent cooperation, like a
business competing in the open market” (Bergeron, 2003; p. 3).
The main benefits of shared services include cost savings through lowering head-count to increase corporate
value and economies of scale (Bergeron, 2003). These services are typically resourced by an internal
department and found in several parts of the organisation fostering a sense of organisational sharing, for
example, a HR function or IT functions. Thus, shared services are different in that they are centralised
activities within a multi-site global corporation. Shared services have become a well-accepted model for
globally dispersed companies across a wide range of sectors such as financial services, ICT, medical device
technologies and global software development. Shared services share similar characteristics to business
process outsourcing including centralised business functions and centralised customer contact points. One of
the driving forces behind shared services is greater economies of scale (i.e. improved efficiency and reducing
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costs) through the reduction of central distributed resources, for example, people, IT and buildings. Services
are considered to be more efficient when delivered through a centralised and standardised service provision
typically as a result of IT solutions. The key difference between outsourcing and shared service is that shared
services are making what was an internally available function available on a global scale.
Cooke (2006) and Bergeron (2003) identify key benefits of a shared services approach. Specifically, shared
services provide an integrated, decentralised solution decrease personnel requirements, improvements in
cross-group learning and sharing of good practice, a focus on continuous improvement in efficiency and
service levels, better technology utilisation and cost savings, more efficient resourcing through economies of
scale, improved service specification and performance monitoring (for example, service level agreements),
and greater service cost and budgetary transparency.
By converting administrative and transaction-oriented tasks into shared services, organisations can focus on
more strategic and value-adding tasks (McIvor et al., 2011). However, in adopting this approach there are
several strategic and operational issues that ought to be considered. For example, Cooke (2006) explains that
considering the high costs associated with the adoption of shared services, one should evaluate the cost
(financial and emotional) in moving to this business model. Organisations should take a holistic and
sophisticated analytical approach to weighing up the pros and cons of insourcing versus outsourcing.
Organisations should not expect an immediate return on their decision to adopt shared services for the first
number of years. McIvor et al. (2011) identify four challenges to implementing shared services; standardising
processes and restructuring a support business process, resistance to change from other (interlinked)
departments, tightly coupled IT infrastructure, and a lack of required capabilities (internally and from
vendors).
From these challenges, it is evident that organisations adopting a shared service business model should place
importance on the need for strong governance to drive standardisation, performance improvement and
relationship building (internally and externally). To help organisations achieve this, McIvor et al. (2011)
propose the following six step process. First organisations should employ a structured project management
approach with clearly defined project objectives and strong leadership. Once this is achieved they need to
engage with vendors to develop potential sourcing options. Next the organisation should leverage external
expertise during contracting to determine key performance indicators (KPIs), service level agreements
(SLAs), and other legal advice. Subsequently they must build relationships with key internal stakeholders,
plan and implement a process improvement strategy to remove any inconsistencies in corporate policies. It is
also necessary to employ relational and formal contracting as complements to foster strong inter-personal
relationships between the client and vendor. And finally, the organisations should plan and implement a
change management strategy.
Business Process Outsourcing (BPO)
While shared services are internally focussed, as a form of outsourcing, business process outsourcing
(BPO) is an externally focussed solution. BPO allows organisations to adopt flexible, service-driven solutions
typically involving the contracting-out of specific operations of business functions and processes to a third-
party service provider (Kauffman and Sougstad, 2007; Willcocks et al. 2004). Initially, BPO was defined as
long-term contracting of an organisation‟s non-core business processes to an external service provider
(Romberg, 1998). While it was traditionally associated with the manufacturing sector and non-core processes,
it is commonly implemented across the service sector and across all processes including core processes. As
such, the Gartner (2012) definition may be more appropriate, that is, BPO is the delivery of one or more
business-process-related services that are delivered by an external third party.
BPO offers organisations increased flexibility in many ways. For example, organisations can remove the
„distraction‟ of managing administrative or similar peripheral processes and allow them to concentrate on the
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core business competencies and processes that sustain their competitive advantage. There are several benefits
to the successful adoption of a BPO service model. According to Yang et al. (2007) and Gewald and Dibbern
(2009), these include; a reduction in costs through process improvements, performance, strategic, and
financial risks, a reduction in requirements for upfront investments to permit shared technology resources and
risks with the vendors, an ability to concentrate on core business and avail of external expertise, an increased
agility to meet changing customer demands, and increased revenue by outsourcing non-core processes.
BPO has emerged as a flexible and powerful management approach to achieve a wide range of tactical and
strategic goals. However, the literature suggests that there are a number of determinants which affect the
success of BPO adoption (including expectation, risk, and environment). Corbett (2004) and Yang et al.
(2007) suggest that the main challenges in adopting BPO include; a reluctance to lose control and flexibility,
the critical state of a core business function, negative/nervous reactions from customers, and employee
resistance.
BPO typically has a heavy emphasis on reducing the total cost of ownership (TCO), which takes into account
the cost of operations, the cost of errors and the cost of control. However, according to Sengupta (2011),
organisations drastically underestimate their TCO because they misunderstand, underestimate and/or ignore
many of the hidden costs associated with TCO for their business processes. This emphasises the need for
greater service analytics and poses the question of whether organisations are measuring the right things,
particularly around the total cost of errors and measuring quality within a business process.
With the increased flexibility offered by service-driven IT solutions, organisations must face “increased
complexity and exposure to risk” (Kauffman and Sougstad, 2007). To address this, BPO contracts must cover
a wide range of issues such as service level, quality, timeliness, and penalties and/or incentives based on
contractual parameters including contractual obligations, service requirements, accountability and security.
To address these, KPMG (2009) recommends care in five key BPO activities; choosing partners, aligning
incentives, measuring outcomes, handling change and scaling solutions.
Business Process Utility (BPU)
Business process utility (BPU) is an emerging „plug-and-play‟ option to support the alignment of people,
processes and IT to deliver transactional processes. Gartner (2012) defines BPU as the delivery of BPO
services that are highly standardised, largely preconfigured and highly scalable, which may or may not fully
or comprehensively leverage Internet technologies for delivery. The automation of BPU may depend on the
nature of the service and the shared labour complexities, however these services are likely to have
significantly less customisation than traditional one-to-one BPO offerings. BPU also offers greater
configurability to suit different user cases and services environments. As BPU operates at the process level
and not the solutions level, issues around standardisation and interoperability of business process platforms
may arise in an agile, cloud-focused business environment.
The deployment of a BPU service model is not necessarily a technology decision rather, it requires multiple
stakeholders to specify whether a business process may be customised and examine whether that process
provides a competitive advantage. BPU relieves organisations of repetitive, independent business process
execution and monitoring and allows them to concentrate on core business processes and innovative process
design to increase the organisations competitiveness. BPU also allows organisations to adopt standardised
business practices while relieving them of the redesign of relatively complex tasks, for example, a payment
process system. BPU typically comes ready to implement as a packaged solution offering both cost and time
saving advantages.
As with the other approaches discussed in this paper, adopting BPU involves a variety of challenges. For
example, business stakeholders must examine whether they can gain any competitive advantage if other
organisations are adopting a similar standardised business process. Understanding the real business benefits
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of BPU presents many challenges for organisations particularly mission-critical and competitively unique
business processes. Ultimately, decisions regarding BPU will be influenced by the cost considerations.
Business Process-as-a-Service (BPaaS)
Building on the earlier discussion of business processes, business process „as a service‟ implies that a
process is predefined and made available to organisations to extend their service capabilities. The expression
(business) “process as a service” (BPaaS) was coined by Wang et al. (2010) who envisaged a collaborative
and outsourcing element exploiting cloud service processes. Accorsi (2011) defines BPaaS as:
“a special SaaS provision model in which enterprise cloud offerors provide methods for the
modelling, utilisation, customisation, and (distributed) execution of business processes”.
Accorsi does not view BPaaS as a distinct service model from SaaS but merely a subset. In addition, Chang
(2012) does not suggest that BPaaS is dissimilar to SaaS by definition since it is as a service model which
improves business connectivity and streamlines the essential business processes. In contrast, IBM (2011)
suggests something much more discrete:
“Business process services are any business process (horizontal or vertical) delivered through the
Cloud service model (Multi-tenant, self-service provisioning, elastic scaling and usage metering or
pricing) via the Internet with access via Web centric interfaces and exploiting Web-oriented cloud
architecture.”
IBM‟s definition places BPaaS on top of the cloud service stack (see Figure 3) however they do not identify
specific characteristics of running business processes in the Cloud.
Figure 3 BPaaS positioning within the Cloud Reference Architecture (source: IBM)
There is often confusion regarding the difference between SaaS and BPaaS. We suggest that they can be
differentiated by level of granularity:
SaaS: the application to deliver a service which can consist of one or several BPaaS. SaaS enables a
service capability through the use of applications running on a cloud infrastructure and accessible from
various client devices with limited user-specific application configuration settings, for example, Gmail.
BPaaS: a business process which is automated and linked within or to other SaaS environments. BPaaS
offers a customised business function which supports a core business process, for example, payroll.
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Commentators have suggested a wide variety of other “defining characteristics”. For example, BPaaS is not
merely process automation in the Cloud. BPaaS should have the capacity to allow developers to create unique
end-to-end business processes that are usually syndicated with other external services (Papazoglou and van
den Heuvel, 2011). This allows the organisation to become more agile in the sense that they can avail of a
well-defined, granular and consistent piece of technology to match their policies. BPaaS can be successfully
linked to the SaaS through a „packaged offering‟. BPaaS should be designed to be service-oriented and
supported through defined interfaces. BPaaS should have a high degree of standardisation to offer the same
optimised service delivery system to many different (competing) organisations. We have summarised these
supporting characteristics of BPaaS below, which we name the SEIFS framework:
Situation: The service is positioned on the top layer of the Cloud Stack (i.e. above SaaS, PaaS,
and IaaS).
Elemental: The service supports the configuration or redesigning of existing business processes.
Integration: The service is seamlessly integrated into existing services (e.g. through APIs).
Flexibility: The service supports multiple development environments and programming languages.
Scalability: The service is scalable supporting different customer demands and service optimisation
over time.
SaaS provides an offering that enables a business process to operate and is delivered through a fully managed
application. BPaaS is a cloud service that delivers a business process with a specific outcome for the user.
Thus, through a BPaaS model, business processes may be automated, for example managing e-mail, shipping
a package, or assessing customer credit. The primary difference between a Cloud BPaaS and traditional
business process outsourcing is a service-oriented software application that has well defined interfaces and is
standardised to be configured across many organisations that support best practice through software models.
It should be capable of supporting multiple programming languages and multiple deployment environments
which can also handle massive scaling. BPaaS can be viewed from two perspectives, a user and provider:
User: a model in which provides standardised business processes on a pay-as-you-go basis. This allows
access to shared resources (people, application, and infrastructure) from a single service provider.
Provider: the delivery of BPO services that are sourced from the cloud and constructed for multi-
tenancy. The pricing mechanisms are typically consumption-based or subscription-based.
As a cloud service, the BPaaS model is accessed via Internet-based technologies. It is mostly used for stand-
alone service modules, not core applications, for example, payment. According to Gartner (2012)
organisations that are currently using or planning to use BPU or BPaaS for BPO exceed 60% (see Figure 4).
They explain that the BPaaS market is expected to reach $133.5 billion in 2015 from $71.7 billion in 2011
which reflects its significant potential to be a core service strategy and an opportunity for Ireland in the
future.
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Figure 4 BPaaS Adoption (Gartner, 2012)
The promise of BPaaS is centred on the notion of configurable computing resources that can be rapidly
provided and released with minimal management effort or service provider interaction. Ensuring service
compliance is often considered a challenging task particularly for BPaaS, which has a global reach, is a
daunting task and presented many issues. Organisations are beginning to change their view on how they avail
of or provide cloud capabilities since it is altering their buying behaviours based on a number of key factors
(for example, deployment speed, economics and customisation of cloud service process). BPaaS allows
organisations to „free up‟ their operations by removing the business and IT underlying services and support
processes (for example, middleware, networking, database management). Furthermore, BPaaS allows
organisations to implement specific services based on granular customer demands.
The boundaries between platform BPO and BPaaS are gradually diminishing. Outsourcing business processes
allows organisations to focus on core business processes. BPaaS allows organisations to deliver business
process outcomes rather than being concerned with the mechanisms to achieve the outcomes. Thus, to
achieve a high excellence standard of BPaaS, there must be considerably more focus on eliminating errors
through improved service quality monitoring methods. Business processes have been well documented
throughout business in the information systems (IS) literature. Our interest in business processes stems from
our requirement to understand the orchestration of exchanging business resources to perform specific tasks to
enable service delivery. The manner in which they are executed is considered the root of differentiation and
therefore the source of competitive advantage (for example, Porter, 1991; Papazoglou and van den Heuvel,
2011). Business processes in a cloud context alters our understanding of being competitive since „the Cloud‟
is now considered a level playing field – allowing business to avail of similar functionality.
METHODOLOGY
We adopt a qualitative research methodology to enable us to record, analyse, and interpret the insights
gathered from organisations that employ a BPaaS model. One of the best methods of achieving this is
through cases. A case study may be described as “a research strategy which focuses on understanding the
dynamics present within single settings” (Eisenhardt, 1989; p.534). Case studies are considered a useful tool
to offer more „structure‟ for exploratory research (Yin, 1984; Walsham, 1995; Rowley, 2002). For example,
Eisenhardt (1989; p. 548-549) suggests that a case study is:
“...particularly well suited to new research areas or research areas for which existing theory seems
inadequate. This type of work is highly complementary to incremental theory building...”
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Yin (1994), explains that case studies are typically employed as an empirical inquiry to answer “how” or
“why” questions and act as an observant to gain an understanding of the circumstances which contribute to a
particular phenomenon in a real-life context. Cases prescribe specific actions in context to be explored; to
clarify people‟s judgements; and to provide a less personal and therefore less threatening way of exploring
sensitive topics within a business context (for example, Cooper et al. 2003). In addition, it allows the
participants of this research to define the situation in their own terms, i.e. providing “short stories about
hypothetical characters in specified circumstances, to whose situation the interviewee is invited to respond”
(Finch, 1987; p. 105). These „stories‟ provide us with insights on “situations and structures which can make
reference to important points in the study of perceptions, beliefs and attitudes” (Hughes, 1998; p. 381) which
depict specific scenarios and situations. Cases typically achieve three key tasks:
1. Offer a discussion on sensitive experiences which can be compared to state-of-the-art literature;
2. Offer clarification of individual judgements in a particular context;
3. Provide insight on people‟s interpretation of actions and occurrences.
The following section comprises of three mini-cases that have employed BPaaS as a service provider model.
We explore how BPaaS has supported organisations adopt cloud computing solutions to enable business
process execution through alternative means.
MINI-CASES
License Management as a Service: InishTech and ABB Robotics
Background
InishTech is an Irish software developer that develops and markets cloud-based software solutions for
licensing, packaging and protecting software. InishTech‟s main service is called Software Potential. This
cloud-based service offers users a flexible license management system, stock keeping unit (SKU) agility, IP
protection and usage analytics services. These services offer Independent Software Vendors (ISVs) the ability
to move away from the “one size fits all” software model and avail of the ability to offer different packages
such as trials, freemium and premium packages. Originally, Microsoft‟s Software Licensing and Protection
Service (SLPS), Software Potential was spun out through the Microsoft IP Ventures Program in May 2009
when InishTech was formed with Microsoft as a major shareholder. In 2009, InishTech inherited over 80
customers with deployments on-premise and through software-as-a-Service.
Today, InishTech provide a suite of software licensing services delivered directly from the cloud for .NET
software applications. This includes the strongest .NET code protection tool, dynamic software packaging,
SaaS software usage metering, licensing analytics, and concurrent/floating license management. As part of
Software Potential, InishTech provide a set of runtime APIs that allow ISVs to integrate license management
& control capabilities within software application. The runtime APIs give ISVs the ability to control and
automate key tasks in the interaction of licensing with local applications e.g. requests, activations, queries,
feature checks and revocations. The Software Potential Web APIs enable ISVs to further integrate these
license management capabilities and associated data collection into external applications such as billing, e-
commerce, CRM, HelpDesk and ERP applications.
Challenge
ABB is a global leader in power and automation technologies headquartered in Switzerland. It employs over
145,000 people and operates in approximately 100 countries. Committed to innovation and improving
performance in productivity, reliability and efficiency, ABB is a pioneer in industrial robots having designed
and manufactured the world‟s first electrically powered industrial robot and the world‟s first industrial paint
robot. Today, ABB has the largest installed base of any robotics manufacturer with over 200,000 robots in
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operation. In addition to designing and manufacturing the robots, ABB develop and market RobotStudio,
software for programming robots. RobotStudio is used by ABB and an ecosystem of independent software
vendors to develop specialist controller software for robots. ISVs can purchase RobotStudio licenses through
ABB‟s sales team. These orders are processed and fulfilled using SAP, ABB‟s enterprise platform of choice.
RobotStudio is a valuable software suite. As such, code protection and license and entitlement are critical for
both ABB and its wider developer ecosystem. Like many software developers, ABB were faced with a
decision to build their own license entitlements system, to buy a third party system or do nothing and rely on
traditional contracts.
Solution
In 2010, soon after InishTech was established, Microsoft launched Windows Azure, its cloud computing
platform and infrastructure. As a Microsoft spinout and investment, InishTech were encouraged to migrate
from its existing service provider, RackSpace, to Windows Azure. This resulted in a 75% cost saving to
InishTech and served to strengthen InishTech‟s relationship with Microsoft at an early stage in the
company‟s growth.
Initially, ABB licensed SLPS from Microsoft and installed it on-premise in Sweden. On spinning out SLPS,
Inishtech inherited ABB as one of their customers. During discussions with ABB, it became clear that
managing and maintaining an on-premise server for code protection and license entitlement was not cost
effective nor a good use of value human resources at ABB. As the business grew, more and more resources
would have to be allocated to this task. At the same time, ABB as a company, was exploring cloud
computing as a technology for the RobotStudio ecosystem to use for building and delivering RobotApps
(small RobotStudio Addin applications for niche requirements), as means to improve their own productivity
and efficiency but also as a target market for wider ABB solutions e.g. energy efficiency solution for data
centres. As the RobotStudio ecosystem grew and more and more RobotApps were developed, license
management and data capture would become a more complex burdensome task. ABB could envisage
requiring specific e-commerce and portal services that may not be capable of being supported easily from
their on-premise solution.
ABB and InishTech analysed ABB‟s license management requirements from first contact to revocation and
the systems within ABB to support this process. For each user, use case scenarios were developed.
Seamlessly integrating with ABB‟s deployment of SAP for different elements of the ordering and fulfilment
cycle was identified as a critical success factor. This included:
generating licenses dynamically from SAP during order booking;
connecting each purchase with automated license activation;
capturing licensing information for the purpose of billing; and,
supporting revocation, reissue, upgrades and license generation.
InishTech web APIs allowed Software Potential to be seamlessly integrated into ABB‟s SAP installation. As
Software Potential sat on Windows Azure, ABB would benefit from the quality of service guaranteed by
Microsoft for its cloud service and on-demand scaling to support its business requirements. In addition, ABB
would benefit from new features and functionality that were not included in the original SLPS or required a
fresh install on-premise with the risk of interrupting existing operations. By mid-2011, ABB had fully
migrated to Software Potential in the cloud resulting in a significant cost savings to ABB resulting from
reduced hardware, software and associated labour costs and future proofing their license management process
from future business model and delivery changes.
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On-Demand Rendering Capacity: Rendicity and Gecko Animation
Background
Based in Cork, Rendicity was formed in April 2009 by Dr James Kennedy and Dr Philip Healy, two experts
in distributed and cloud computing. Rendicity develops and markets software systems for job based parallel
applications. Rendicity provide on-demand scalable capacity for jobs that require specific compute intensive
applications. Due to the nature of these jobs and the applications required to deliver them, job duration can be
extremely long even with high capacity local machines. Rendicity‟s software allows clients to broker and
provision scalable cloud computing resources from a variety of cloud infrastructure providers benefitting
from Rendicity‟s automatic data management, security, and budget enforcement. As such, jobs are completed
more efficiently and effectiveness providing the user significant time and associated cost savings.
Advances in technology have increased the demand for entertainment products featuring 3D visual effects,
animation and images. Rendering is one of the final processes in creating a 3D image or animation from a
prepared scene and each scene may need several layers of rendered material. Real-time rendering is often
used for interactive media as game players may not necessarily need the highest quality image or animation
and software techniques can be used to offer a minimum level of quality sufficient for the human eye to
tolerate. Non-interactive media, such as film or televisual programming, requires a much higher level of
quality. Broadcast quality 3D rendering is computationally a very intensive task and typically requires
dedicated and costly hardware to process. Rendering an image or animation may take several minutes or
several days depending on the complexity of the image or animation. As such, larger studios typically use
render farms, clusters of high performance machines, to benefit from greater capacity and parallelism. The
allocation and scheduling of such jobs is generally undertaken by a dedicated member of staff known as a
Wrangler. Smaller studios, under less time pressure and with less available funds, may use high end local
desktops. Rendicity has developed a range of solutions for individual animators, small to medium sized
animation studios and large animation studios with plugins to support the major 3D animation software suites
including Autodesk Maya, Autodesk Softimage and Blender.
Challenge
Gecko Animation is a 3D Animation, Visual Effects and Post-Production studio based in London. Gecko
specialises in visual effects, 3D character animation, product visualisation, architectural visualisation and
digital media for film, television, video-games, technology companies as well as clients in the art world.
Clients include Channel 4, Dave, the BBC, Excedrin and the NSPCC. The company have developed a
distinctive competence in the use and development of open source technology and specifically, Blender, the
leading open-source platform for creating 3D visual effects and animation. Ben Simonds, a Director of Gecko
Animation, is an authority on Blender and has spoken widely and published a book on advanced use of
Blender for animation.
Blender was originally developed as proprietary software application by a Dutch animation studio, NeoGeo.
Blender came to wider prominence when the software developer behind the project at NeoGeo, Ton
Roosendaal, established a company to develop and exploit the IP in Blender in the late nineties. By 2002,
NaN encountered financial difficulties and with funding from the wider Blender community, Roosendaal
formed a not-for-profit foundation to support Blender and its community, The Blender Foundation. Since
2002, Blender has been available as open-source software under the GNU General Public License.
In 2012, Windfall Films commissioned Gecko Animation to work on the title sequence for the 2013 Royal
Society Christmas Lectures. The Lectures were scheduled to broadcast on the 26th, 27th and 28th of
December. Gecko Animation had a deadline of the 3rd of December to supply fully rendered images to
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Windfall Films however on the 28th of November realised that the rendering time on their local machines
was estimated at over 50 hours assuming no failures.
Solution
As one of the leaders in the Blender community, Rendicity identified Gecko Animation as a potential
strategic beta customer and emailed them to this end. Faced with the looming deadline for Windfall Films,
Gecko Animation contacted Rendicity on the 28th of November to explore whether Rendicity‟s service could
be used to render their title sequence images and animations quickly. After a test and minor modifications,
Rendicity‟s software was used to broker and provision an on-demand render farm in the cloud to meet
Gecko‟s limited timeframes and optimal budget. Rendicity brokered 2 GPUs using Amazon Web Services
delivering the output within 9 hours to Gecko Animation allow Gecko Animation to meet their delivery
deadline.
Support-as-a-Service: Auxilion and Mainstream Renewable Power
Background
A subsidiary of technology consultants, IT Alliance, Auxilion was established in Dublin in 2012 to (i)
support organisations in their migration to the cloud and (ii) offer cloud-based support as a service. The
cornerstone of Auxilion‟s service offerings is the Auxilion Virtual Service Desk. This is an end-to-end virtual
support service facility that provides enterprise-quality and affordable IT and business support services
through cloud-technologies and a virtual workforce model. Auxilion provide 24/7/365 end user support, first,
second and third line support, catch and despatch or full incident resolution and cloud services support.
Auxilion develop customer-branded self-service web portals to interface with their clients‟ systems.
Enterprises outsource the IT support and helpdesk function for a variety of reasons. These include inadequate
business size to support the function, underperformance by existing services, value for money, 24/7/365
service demands, and a requirement to focus on the core and distinctive competences of the enterprise
(Grupe, 2007). Increasingly, outsourced IT support and helpdesks are provided by large service providers
using large globally distributed contact centres. Thus, 24/7/365 end user support can be maintained through
carefully managed shift models. Such service providers may be cost prohibitive for small to medium sized
enterprises.
Challenge
Mainstream Renewable Power develops and builds wind and solar plant for sale to utilities, energy intensive
corporations and pension funds. Mainstream have a deep focus in the construction and management of wind
and solar plant and specialises in bringing the projects through all the stages of development. Mainstream
currently operate in Ireland, the USA, UK, Canada, Germany, South Africa and Chile. Mainstream‟s IT
support was delivered on-premise however as the company grew rapidly and staff were increasingly mobile
particularly during construction phases, the capacity for the IT team to deliver 24/7/365 localised on-premise
support was limited and like to be exacerbated as the company continues to experience exponential growth.
At the same time, management recognised that IT support was often a burden on resources distracted the IT
department from core wind and solar related IT projects. More importantly, on-premise service solutions did
not give the company the flexibility it desired. Mainstream wanted to consolidate its global IT support for all
its end users while ensuring a high quality localised support service and re-orient its Information Services
team to support core strategic projects.
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Solution
Mainstream Renewable Power‟s on-premise infrastructure was deployed using Microsoft technologies. In
the first phase, Auxilion customised and deployed its Virtual Service Desk to support the existing
infrastructure and end users. As Auxilion used Microsoft technologies common with Mainstream, they were
able to integrate the Virtual Help Desk easily and quickly ramping up to meet Mainstream‟s requirements. A
self-service portal provides Mainstream users with various options to avail of online support including
telephone, web-based self-service support and email. A ticketing system captures all of the IT support issues
(general and specific) which are logged by any particular user. Tickets are routed to agents located around the
world who act on behalf of Mainstream. These agents are the first point of contact organisation to resolve
requests. The requests are predefined processes aligned to ITIL and resolved in a structures format governed
by SLAs. The Virtual Service Desk has now expanded to provide 24/7/365 support to all Mainstream
employees and affiliates across five continents. Mainstream, with Auxilion, is moving its on-premise IT
infrastructure to the cloud including Office 365, SharePoint Online, Dynamics CRM Online. This will be
deployed on Microsoft Windows Azure maintaining the common infrastructure with Auxilion.
DISCUSSION
Definitional Ambiguity: Towards Derivative Cloud Service Models
We previously defined BPaaS as the provision of a business process or customised business function that in
turn supports a core business process, is automated, is linked within or to other SaaS environments, supports
multi-tenancy and utility-based pricing mechanism. While each of our case studies met these requirements
(See Table 1 below), further monitoring and research needs to be undertaken to validate that this definition is
both mutually exclusive and collectively exhaustive.
Table 1 Defining BPaaS with InishTech, Rendicity and Auxilion
Characteristic
InishTech
Rendicity
Auxilion
Function
License Management
Rendering
IT Support
Core Process
Order & Fulfilment
3D Animation
Information Services
Customisation
Business Model, Packaging,
Activations
Nodes, Processor Power
Service Levels, Modes,
Language
Other SaaS
Environments
Azure
AWS
Sharepoint, Azure
Automation
License generation,
activation, revocation
Brokerage, Provisioning
Web Based Self Service
Support, Ticketing
Pricing
Consumption and
Subscription
Consumption
Subscription
Multi-tenancy
Yes
Hybrid
Hybrid
We have also suggested five characteristics that may be useful in giving guidance in deciding whether any
given service is BPaaS or not, which we refer to as The SEIFS framework i.e. Situation, Elemental,
15
Integration, Flexibility and Scalability. While one can argue that the three case studies meet the SEIFS
requirements (See Table 2 below), one could also equally argue that in some instances they could also be
classified as SaaS (InishTech and Auxilion) and PaaS (Rendicity). Thus situation may not be useful as a
defining characteristic but rather only in a supporting role. Similarly, integration, flexibility and scalability
are characteristics which can be applied to other service models and therefore are supportive rather than
definitive. It would appear that elemental may be the only uniquely defining characteristic of BPaaS in that
the BPaaS service model is a sub-process or element of a wider process however even in this instance, one
can easily envisage software delivered on the cloud which is both SaaS and BPaaS. To this extent, we find
that BPaaS might not be considered a new distinct cloud service model but rather a derivative model. This
area warrants further research.
Table 2 SEIFS Classification of BPAAS Applied to InishTech, Rendicity and Auxilion
Characteristic
InishTech
Rendicity
Auxilion
Situation
Sits on SaaS and PaaS
Sits on PaaS
Sits on SaaS and Paas
Elemental
Order & Fulfilment
3D Animation
Information Services
Integration
API
Plug-in
Web Services
Flexibility
Any .NET Application
Maya, SoftImage, Blender,
All
Scalability
Azure
AWS
Azure
*Support for java-based platforms forthcoming
There may be some value in considering BPaaS services against narrow and broad definitions of BPaaS. A
narrow definition may meet the definition as illustrated in Table 1 and strongly meet all the characteristics
outlined in the SEIF classification in Table 2. One could envision a continuity where BPaaS is conceptualised
as a pure web service to one where BPaaS merely generates an output for a wider process that has the
potential of being integrated in to a third party cloud service but does not necessarily need to be. Whether this
could truly meet definition of BPaaS is questionable.
The concept of orchestration may be useful in thinking of BPaaS and considering for future research. As
enterprises make use of more cloud services and BPaaS services, the orchestration of these services along the
chain of service provision will become more and more critical. Consideration of BPaaS through the lens of
orchestration or workflow management may be useful and one might posit that orchestration is, in fact, a
defining characteristic of BPaaS over SaaS.
Enterprise Motivations and Challenges
In each of ABB, Gecko Animation and Mainstream Renewable Power the relevant business processes were
none core processes and the primary motivation was to concentrate on core business, avail of external
expertise and increase agility to meet either customer or organisational demands. This is in line with
traditional BPO expectations outlined earlier. Similarly, none of ABB, Gecko Animation and Mainstream
Renewable Power faced the common challenges to BPO success e.g.:
Reluctance to lose control and flexibility – in each case, the BPaaS provided greater control and
flexibility over the existing state of affairs.
Critical state of core business function- in each case, the core business functions were in good health.
16
Negative/nervous reaction from customers – in each case, the processes are seamlessly integrated in
to the enterprise systems and therefore this issue is avoided.
Employee resistance – this issue only arises in the case of Mainstream Renewable Power, in which
case the Auxilion service does not impact the Information Services team negatively and improves
quality of service and availability for other employees.
This finding may be instructive and useful for other BPaaS providers in the context of market segmentation,
targeting and positioning, and specifically identifying scenarios with high likelihood of success or “low
hanging fruit”. Further research on perceived versus actual benefits gained would also be instructive. It is
noteworthy that in each of the cases, cost savings were not the main motivation (although at least in one,
RobotStudio, these savings were acknowledged). Greater research needs to be undertaken on business value
measurement at the BPaaS level. Existing frameworks may prove useful here. For example, Mooney at al.
(1996) suggest analysis through automational effects, informational effects and transformational effects. This
framework would require more in depth case study research to identify the key operational and management
process that contribute to the achievement of strategic goals and the impacts of BPaaS, and indeed the cloud,
along automational, informational and transformational lines. This may require a new conceptualisation of
both operational and management or organisational metrics and aligns well with existing work within IC4 on
the ontology of cloud service metrics and organisational capabilities.
A related area of research focuses on methods for calculating accurate return on investment and cost benefit
analysis of BPaaS. In arriving at such calculations, a robust technique is needed not only to calculate the cost
of development and delivery but the cost of usage thus necessitating a means to establish the technical burden
(from a cost perspective) of a given business process from the interface through the various layers of the
cloud stack in both state of readiness and a state of use. Calculating value is a more challenging project
requiring not only accurate costing of a given process, indeed a given feature, but also the value to the user
taking in to account the rarity and inimitability of that particular process. Granular costing of cloud features
and functionality can provide valuable support to a variety of decision makers from IT to Marketing e.g.
informing project prioritisation or price setting. On the consumption side, such data can inform total cost of
ownership models aiding in outsourcing versus insourcing decisions, budget allocation and vendor
evaluation. Existing work in IC4 relating cloud metrics and monitoring should consider how such research
could contribute to cloud cost analysis.
Towards an Analysis Framework for BPaaS Services: The Integration-Demand BPaaS Matrix
As part of our study, we considered various ways of analysing BPaaS services, a process that is on-going.
One frame of analysis that seems fruitful is a framework that maps BPaaS services by depth of integration
with client enterprise systems and the enterprise demand requirement profile, which we name the Integration-
Demand (I-D) BPaaS Matrix. Figure 5 presents the I-D BPaaS Matrix as applied to the cases studied in this
report.
17
Figure 5 The Integration-Demand BPaaS Matrix
Highly Integrated, Continuous Demand: InishTech‟s license management solution is highly integrated
in to ABB RobotStudio‟s order and fulfilment process and requires continuously available.
Lowly Integrated, Continuous Demand: Auxilion‟s Virtual Help Desk does not require deep
integration in Mainstream Renewable Power‟s IT systems to provide IT support services however it is
required to be continuously available to support 24/7/365 queries.
Lowly Integrated, Ad Hoc Demand: Rendicity‟s services neither require deep integration with
Gecko‟s installation of Blender nor does it need to be continuously available. Gecko may use local
machines for rendering or where tight deadlines use Rendicity on an ad hoc basis.
One might argue that a BPaaS strategy that is highly integrated and required continuously is more likely to
have tighter customer lock-in than other scenarios with ad hoc demand and low integration BPaaS solutions
being more open to competitive substitutes. For example, it is not difficult to posit that the replacement cost
for InishTech is greater than Rendicity. Autodesk or Blender may decide to provide their own competitive
services fully integrated in to their software suites thus locking out Rendicity. Notwithstanding this,
Rendicity has the possible protection of patents and early mover advantage. By comparison, while Auxilion‟s
virtual help desk requires high availability, by itself has many existing substitutes. Strategically, Auxilion has
insulated itself in the short to medium term from competition by using a complementary service to tie
Mainstream to them i.e. managing Mainstream‟s IT infrastructure migration to the cloud. Further research is
required to validate the utility of the I-D BPaaS Matrix and consideration is required on the utility to various
decision makers. In addition to use as a product strategy tool, it may have value in market segmentation,
targeting and positioning.
It may also be useful to examine BPaaS through other vectors. Following on from the brief discussion of
orchestration in, there may be value in examining BPaaS cases from this perspective and the wider workflow
management literature. For example, orchestration may be a more elegant vector of analysis in lieu of
“Integration” in the I-D BPaaS Matrix above. In addition, such a frame of reference leads consideration to of
process definition and process enactment. Which party defines the business process? Which party enacts the
process? A party with control of process definition and process enactment may a strategic advantage which
may be worth exploring. Similarly, one might consider analysing BPaaS service provision from various other
perspectives including risk management, management complexity, data complexity, and value add.
CONCLUSION
BPaaS remains at a relatively early stage of conceptualisation and maturation, but it will ultimately mean
minimal management effort or coordination for specific company processes, freeing up time for core/other
18
business activities. It may therefore be worthwhile to further review extant research and associated
methodologies in the wider business process outsourcing literature to further explore whether the same
outcomes hold for BPaaS. Similarly, establishing comparative data between BPaaS and other cloud service
models may prove to a fruitful endeavour. It is clear that as BPaaS evolves, further challenges will present
themselves. For example, use scenarios effectively equating to Software Feature as a Service e.g. view or
print are emerging. This level of granularity introduces both pricing and costing challenges which provide
opportunities for both business and technological research e.g. informing and developing total cost of
ownership and return on investment tools based on data generated from a feature through to the infrastructure
layers. BPaaS introduces specific orchestration challenges within the chain of service provision and as such
may also impact emerging models such as Cloud Brokerage.
19
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