SaaS: Killer of the Traditional IT Department

Might happen for some companies... the really short-sighted ones, that won't be with us long. Companies with any vision whatsoever are always going to see the ability to use technology, and information technology in particular, to gain a competitive advantage. But using homogenized, one-size-fits-all, cookie-cutter SaaS apps isn't going to provide anybody with any competitive advantage.

So, yes, SaaS will devour the kinds of things that aren't strategic and have no reasonable way to contribute to any meaningful competitive advantage. But as long as companies are looking for an edge, there will always be a place for customized, tailored IT solutions, developed in-house, which embody proprietary knowledge and strategies.

I believe the future will coalesce around a hybrid model where most companies will have IT environments that feature a mix of cookie-cutter, non-customized SaaS apps, more advanced SaaS apps that allow some means of customization, apps hosted in "the cloud" using PaaS or IaaS providers, and apps hosted "on premises" (perhaps using a "private cloud" approach).

In the end, though ( and I wish I could remember/find the source of this quote ):

"Whoever has the best algorithms, wins"