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Feb 21, 2014 (3 years and 5 months ago)

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JamCracker



A Case Study






By
Murtuza Arsiwala

Bjarne Berg


October 3
, 2006
Bjarne Berg

DRAFT


Murtuza Arsiwala






JamCracker

2/21/2014

2

of
16


Table of Contents


1.

JAMCRACKER’ BUSINESS

MODEL
-

COSTS, REVENUES, ASS
ETS & THREATS

............................

3

2.

FOUR OF JAM CRACKER’
S MAJOR IT CAPABILI
TIES

................................
................................
........

4

3.

SUPPLY SIDE AND DEMA
ND ECONOMIES OF SCAL
E

................................
................................
...........

5

4.

PRICING STRATEGIES O
F A FIRM USING AN AS
P

................................
................................
.................

6

5.

STANDARDS

................................
................................
................................
................................
.......................

7

S
TANDARDS TO EXCHANGE

DATA BETWEEN APPLICA
TIONS
:

................................
................................
......................

7

S
TANDARDS ON
I
NTEGRATION OF
S
OFTWARE
S
ERVICES TO AN
E
COSYSTEM
/
MARKETPLACE
:

................................
....

8

S
TANDARDS ON THE
A
DMINISTRATIVE LAYERS

PROVIDED BY ECOS
YSTEM

................................
................................

8

6.

VERSIONING AND PRICI
NG STRATEGIES FOR JA
MCRACKER

................................
........................

8

V
ERSIONING

................................
................................
................................
................................
...............................

9

P
RICING
A
PPROACH

................................
................................
................................
................................
....................

9

G
ROUP
S
ALES

................................
................................
................................
................................
...........................

11

7.

JAMCRACKER USAGE MEM
O

................................
................................
................................
....................

11

O
BJECTIVE

................................
................................
................................
................................
................................

11

A
DVANTAGES

................................
................................
................................
................................
...........................

11

D
ISADVANTAGES

................................
................................
................................
................................
......................

12

Q
UESTIONS

................................
................................
................................
................................
...............................

12

A
SSUMPTIONS
................................
................................
................................
................................
...........................

13

8. JAM CRACKER’S EVO
LVING BUSINESS MODEL

................................
................................
.....................

13

M
AN
AGEMENT SHAKEUP

................................
................................
................................
................................
..........

13

C
URRENT
C
ORE
O
FFERINGS

................................
................................
................................
................................
.....

14

C
ORE
IT

STRATEGIES

................................
................................
................................
................................
................

14

R
ECENT
A
CTIVITIES

................................
................................
................................
................................
.................

16

Bjarne Berg

DRAFT


Murtuza Arsiwala






JamCracker

2/21/2014

3

of
16


1.

JamCracker
’ Business Model
-

costs, revenues, assets
&

threats


JamCracker
, during its initial setup in 1999, started out as an Application Service
Provider (ASP) aggregator i.e. being able to provi
de applications from different ASPs on one
common platform. After surviving the 2001 dot com bust,
JamCracker

has modified its initial
business model (from case) to enable itself to run a “marketplace” (ecosystem) where solution
providers (e.g. companies f
ocusing on specific verticals), ISV’s, ASPs and end customers can
use
JamCracker

application framework to provide and consume Software as a Service (SaaS).

As a result,
JamCracker

business model now relies on its latest generation
JamCracker

Service Delive
ry Network (JSDN) to position itself be the new software standard for providing for
SaaS. With this approach,
JamCracker

hopes to reap its experience in being an ASP to its
advantage and has “productized the platform it created for its ASP service”.1

Let

us now analyze the business model of
JamCracker
. The value proposition it provides
in the software arena is that in addition to being an ASP aggregator, it has also made available
its infrastructure services (for a fee of course) to software vendors and s
ervice bundlers. Hence
JamCracker

accrues revenues from hosting software for ASPs etc and selling its framework
products (i.e. Pivot Path, On Demand Enablement Kit) to its ISVs and ASPs. Revenues from
hosting services entailed a setup fee, a per user per m
onth fee for accessing the
JamCracker

service infrastructure and per user per month fee for each application service a customer
decides to use. Interestingly, infrastructure services are sold based on group pricing. Based on
the latest sales material on
Ja
mCracker

web site, the current price of On Demand Enablement
Kit is $25,000 per ISV. Another source of revenue is the integration consultancy provided to
modify ISV and ASP solutions to enmesh with JSDN.

The costs involved were in engineering, product deve
lopment, sales, service delivery
and support provided to all the end customers. Since fixed costs in setting up the infrastructure
are steep, signing more customers and offering multiple services to them through the
JamCracker

infrastructure would allow it

earn generous margins in this space.


A great number of large software vendors (like Microsoft, IBM, SAP (MySAP)) have
indicated that they plan to provide their own software using the SaaS model and that remains a
huge threat for
JamCracker
. Another threa
t comes from outsourcing giants like EDS, Infosys,
Accenture. Given their size and the muscle of cash flow at their disposal, given the right market
conditions, they can very well enter the fray by buying
JamC
racker’s

competition and offering a
rival produ
ct. This indeed is a one of the major threat to
JamCracker’s

business model

Bjarne Berg

DRAFT


Murtuza Arsiwala






JamCracker

2/21/2014

4

of
16

2.

Four of JamCracker’s
Major

IT Capabilities

According

to recent research by Weill, Subramani and Broadbent (2002), an organization’s
IT infrastructure and capabilities can be
identi
fied

by ten clusters. Since JamCracker is a service
provider by itself, and also resells services through other providers (ASP and Saas), we have to
distinguish

the various capabilities in general terms relative to these providers who work within
JamCracke
r’s framework.

While the providers
have

various levels of capabilities, it is helpful to look at these in
general and make some assignments of high, medium and low capabilities overall. When
summarized on the Weil et. al. framework, we find the following
matrix:


JamCrackers
ASP/SaaS
customers
Channel management services
Medium
Low
Security and risk management services
Medium
High
Communication services
High
Medium
Data management services
High
Medium
Application infrastructure services
High
High
IT facility management services
High
Low
IT management services
High
Medium
IT architecture and standards services
High
Medium
IT education services
Low
Medium
IT research and development services.
Low
Low
Capabilities
IT Services

Framework source: Weill, P., Subramani, M., and Broadbent, M. "Building IT Infrastructure

for Strategic Agility", Sloan
Management Review, Vol. 44, 1 (2002), 57
-
66.


JamCracker has developed
core competencies in the area of communication service
s as
implied by a strong network with high availability so that
users

can access the hosted
applications and the SaaS transactions. The company has also solid capabilities in the areas of
application
infrastructure

(application servers, database servers, w
eb servers,
LDAP

etc), as
well as the interconnection between these systems.
These

infrastructure capabilities are
combined with strong facility management capabilities in areas such as backup,
disaster

recovery, physical security and power management (dat
a centers).

Other capabilities include areas such as standardization of IT services (the core
competencies of the company overall to achieve
economies

of scale), as well as some emerging
capabilities in channel management (see section 8 of this document a
nd the new initiative
launched in 2005 to build a network of channel partners).

Bjarne Berg

DRAFT


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2/21/2014

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The weak
areas of JamCracker are

educational services and IT research and development
(outside the
scope

of their offerings). The capabilities in IT security is achieved throug
h its
partners and the areas of education (and installs) at
customer

sites are to be enhanced by the
new channel partner network members and will continue to be outside the scope of the
JamCracker organization.


3.

Supply side and demand economies of scale

F
or information goods, according to Shapiro and Varian, the combination of demand and
supply economies of scale provide a “double whammy” by which growth in demand drives down
supply costs (spread fixed costs across many customers) which drives other users
to use the
product


and accelerating the demand of the information product. This is referred to as a
virtuous positive cycle that
JamCracker

is trying to achieve with its product offering.

Shapiro and Varian point out that information goods have a high fi
xed costs and low
marginal costs and
JamCracker

is not exception. Since 1999, has been making huge
investments in creating an ASP framework where it was first an aggregator of software services
from different vendors and then moving up the chain by “produc
tizing” the lessons it had learned
in managing the ASP business.
JamCracker

is making investments in JSDN to make it the
preferred platform for software providers to offer services to bundlers and end consumers. By
developing the framework which is highly

scalable,
JamCracker

can add new vendor product to
its ecosystem with little or no marginal cost. Hence the larger number of services that are
rendered by
JamCracker
, the lesser is the per unit cost of each service offered and thus
achieving a supply side

economies of scale.

To achieve a positive feedback loop (demand side economies of scale),
JamCracker

needs
the following to happen:




Entice a large number of independent software vendors to adapt their products (or use
JamCracker

On Demand Enablement Kit)

to be delivered as a service.



Have software bundlers bundle various services to target a particular vertical.



Have end consumers access these services over the web using the
JamCracker

platform
of service delivery.


Since software has always been sold in
terms of site
licenses

and other group pricing
mechanisms,
JamCracker

faces huge switching costs when it tries to persuade ISVs to offer
services over the internet via SaaS. To get as many software vendors on board (and to convince
Bjarne Berg

DRAFT


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2/21/2014

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them that this is a new
important channel to market their offerings)
, JamCracker

has priced its
infrastructure services and products at competitive levels to allow potential customers to try it
and determine if its products can be made part of the
JamCracker

ecosystem. Also it i
nvests
money and resources to develop connection adapters with widely used software packages
(Oracle Financials, SAP, Siebel) for use by its customers.

Service bundlers are attracted to an ecosystem where they can create and sell packages of
services to c
onsumers from a large pool of service offerings. Customers get a choice of using
different service bundlers that meets it SLAs and provide a standardized interface (one screen,
on login) to use those services. For the positive feedback loop to be rewarding
, customers will
demand its service bundlers use the
JamCracker

interface and service bundlers ask its
preferred ISVs to be part of the
JamCracker

ecosystem.

The question in everybody’s mind is that whether the ASP industry is subject to a positive
feedbac
k loop and will let the market tip in
JamCracker

directions? Research show that the
software industry, in 2006
, is

paying attentions to the SaaS model of delivering software.
JamCracker

has operating in that space from the start of 1999 and has developed h
uge
amounts of information and products that could deal with any upcoming challenges. Hence we
feel that the ASP industry is currently underserved by major competitors in the software arena
and allows the opportunity to
JamCracker

to achieve positive virtu
ous feedback.

4.

Pricing
Strategies

of a Firm Using an ASP

As a major software vendor we
suggest

a very dynamic and structured
adaptation

of the
pricing policies for ASPs based on a variety of end
-
user factors. We will not charge any price to
the ASP companie
s for the products so that these companies have zero startup costs, but
instead insist on transparency of usage of our software (we will
embed

usage

statistics in our
product logs) . First we will price based on the end
-
customer size across six
dimensions
.

These
include the startup costs that we will charge a profit for the smallest customer (since we are less
likely to make a substantial profit based on transactions). However for the larger companies we
will reduce the startup cos
t
s

to the customers by
eit
her do it for no
-
charge, or by actually
subsidizing

their start up costs for the very large customers. As the number of
transactions

increases, we will reduce the price per transaction, but not to such a level where the marginal
revenues is declining overa
ll. We want to encourage the number of named users, and will keep
these prices moderate even for smaller companies. Overall site
licensees

will be offered, but
will

always

be a function of the company size based on
verifiable

publications of sales revenues

or
the end
-
customers. The overall strategy is that the site
license

will be moderate for the
smaller
Bjarne Berg

DRAFT


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2/21/2014

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firms, but value based for the larger companies. Upgrades often require substantial support,
training and user help. As a result, we will be pricing
the u
pgrades to new releases relatively
high for the smaller companies, but reduce the costs substantially for the larger
companies

to
increase
adaptation

of new technologies and assure that the system is used to its maximum.

For interim fixes (support packs)
that adds new, or enhances existing features, we will
price them individually (one price for each support pack) for small and medium customers and
include them for larger organizations.

Overall our pricing strategy may be summarized as free for the ASP pr
oviders, but pass
-
through pricing to end
-
customers based on system monitoring logs built into our product. This
strategy will induce companies to buy site
licenses
, or pay for individual
usages

based on
transactions and support needs. I.e. a smaller compan
y may pay for a site
license
, or simply
choose to pay for individual transactions. Larger companies will be enticed to pay for
transactions so that we are locked into a growing revenue stream, instead of arguing about
increased
licensing

costs on
an

annual

or semi
-
annual basis.

The pricing strategies can be summarized as:

Pricing model
Small customer
Medium customer
Large customer
Very large
customers
Start up costs
Actual costs +20%
Actual costs +10%
Actual costs only
None
Price per transaction
High
Medium
Low
Flexible
Price per named user
Medium
Medium
Low
Flexible
Site licence
Based on revenues
Based on revenues
Based on
revenues
Based on
revenues
Upgrades
High
Medium
Low
Flexible
Support Packs
Priced individually
Priced individually
Included
Flexible


5.

Standards

Standards to exchange data between applications:

JamCracker

provides a single sign
-
on interface by combining software services from
different ASP and offering them to Small a
nd Medium Businesses (SMB). One of the major
issues that
JamCracker

has faced has been a lack of standards that allow for exchange of data
between disparate applications. For example, when a sales lead is entered into a CRM,
JamCracker

uses its internal pr
ocesses (XML or SOAP protocols) to transfer information to other
software services used by the client such as a customer service application or a merchandising
application.

Bjarne Berg

DRAFT


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JamCracker

2/21/2014

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The advantage to
JamCracker

(if a standard would ever be developed) would be that
it
would be able to integrate software applications in its ecosystem/marketplace more rapidly and
would reduce cycle time in bringing new software applications to its ecosystem.
Customer’s

satisfaction would definitely improve since it enables them to acce
ss new services almost
instantaneously and result in a positive feedback loop for the ASP players trying to expand the
current marketplace for such services.

Standards on Integration of Software Services to an Ecosystem/marketplace:

As a provider/aggregato
r of software services,
JamCracker

would greatly benefit from
standards that would allow its partners (ISV’s, customers, bundlers) to add their products to an
ecosystem/marketplace in a cost effective manner. These standards would ensure that when
ISV’s d
esign/reengineer their applications, following a standard set of protocols would make it
easy to add their product to an existing ecosystem like
JamCracker
.

Standards on the Administrative layers provided by ecosystem

Some examples of the functions perform
ed by an ecosystem espoused by
JamCracker

include managing Company and user records that need to be shared across multiple
applications/service (to support one sign
-
on and application security) as well as managing billing
records to invoice end consumers o
n the usage of the service. This is an important layer that is
often underestimated by the players in the ASP market and often leads to consumers being
unsatisfied due to the technical obstacles they need to overcome with different vendors. Having
a standa
rd that lays down the protocols for an administration layer (a service that
JamCracker

currently provides) would help
JamCracker

gain a competitive edge against its competition.

JamCracker’s
’ success depends on being able to offer a variety of software app
lications as
services. Hence promoting and managing these standards mentioned would accelerate the
ability to drive more ISVs and ASP to offer services through
JamCracker
. In turn, this would help
attract more end consumers to become a consumer of Software

as a Service (SaaS).

6.

Versioning and pricing
Strategies

for JamCracker

Memorandum

T
o:

John More


CEO of SupplyChainRUs

CC:

Executive Committee

From:

Murtuza Arsiwala, Bjarne Berg, Consultants America

Date:

Thursday,
2/21/2014

Bjarne Berg

DRAFT


Murtuza Arsiwala






JamCracker

2/21/2014

9

of
16

Re:

P
ricing and Versioning strategy for
JamCracker

Versioning



With

declining
average

cost per customer, JamCracker needs to move fast to establish a
better and more
encompassing

customer base. The first step is to place more emphasis on
software service solut
ions instead of customized add
-
ons.
The value proposition of going to an
ASP is the reduction in complexity and a solution based architecture. JamCracker need to
standardize their products more, deemphasize the customization capabilities outside some few
c
ore areas in a software solution (see table below), and focus more on bundled
packages

and
industry group sales.


One of the steps is to create software bundles that are known as solutions and
marketed

as a
single

solution and not add
-
ons.
This solution

s
hould be sold as a whole without the
capability to exclude products that a customer may not desire (bundling). It is through cost
leadership and volumes that JamCracker is going to keep competitions at its bay and also be
the hosting platform of choice fo
r ASPs.
To prevent others to enter this space, the company
should also not expect too high margins per deal, and should respond to market dynamics
through differentiations (stability, safety etc) and emphasize the risks of other competitors that
may be re
cent entries into the market.
The approach should be very aggressive and provide
continuous new innovations that simplify

the
adaptation

of the solutions. It is only through the
success of its customer base, that
JamCracker

will be successful. As a result,

JamCracker
should

look at value propositions of its customers and work with them to increase their
marketability (don’t let ‘dead products hang of the shelf’).


The next step is to not only be an intermediary, but also get to know the final customers
thro
ugh click stream analysis, forced registration, personalized interfaces (based on click stream
analysis), and shared billing centers (do billing for their ASP customers).


To determine the optimal pricing approach for the products we recommend that the
com
pany starts a serious
analysis

of the market and the core products being sold. This review
should focus on finding natural
bundles

of products that are being used together and also should
examine how
complementary

products can be added to the overall sales

mix.

Pricing Approach


As a first step we recommend a pricing
strategy

that follows the basic segmentation of
the customers based on a 3
-
tier model. This is a preferred model for those who are risk adverse,
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as we would expect to see a migration to the mi
ddle product.
JamCracker

should undertake a
pricing study that is value based and not based on its own internal cost
structure
. The variable
component of the costs
structure

is the minimum price that should be charged, and not the
maximum. The price
diffe
rentiation

should be based on the core 10 pricing dimensions as
outlined in the
figure

below:

Standard version
Corporate version
Full-suite version
Delay
Max 10 seconds per transaction
Less than 7 seconds per
transaction
Cached - near real time
response
User Interface
Basic version
Optimized with your corporation
colors, logos and backgrounds
As Corporate version, but also
includes help movies and step-
by-step multi-media training
material
Image Resolution
True color-24 bit 1160 x 860
True color-32 bit 1160 x 860
True color-32 bit 1280 x 1024
Speed of operation
All commits and confirmations
within 10 seconds
All commits and confirmations
within 7 seconds
All commits and confirmations
within 7 seconds
Format
Standard print supported
Standard print and PDF
supported
Standard print, PDF, post script
and imaging supported
Capability
Upto 50 users concurrent
Upto 200 users concurrent
Over 200 concurrent users
Features
Basic features *(tbd)
Most features *(tbd)
All features *(tbd)
Comprehensiveness
Stand-alone
ETL tool included to map to
other applications
B-APIs and core interface
connections to ERP applications
supported
Annoyance
Some ads based on your
industry
No ads
No ads
Support
Support calls answered within 24
hrs
Support calls answered within 2
hrs
Support calls answered within 30
minutes
Price
TBD
TBD
TBD
Product bundling
TBD
TBD
TBD
Area
Pricing dimension

To create a
network

effect and to assure a fast
adaptation

of the new pricing model, we
also suggest a promotional price is made to new customers during a very
aggressive marketing
campaign

over a 12 months period. This should be construed as new customers, as each of
these products should be treated as new and different
products

through both product names as
well as bundling of products that are not being used b
y existing customer base. The existing
customer base should also be approached with a sales pitch to switch to the new model (not
required), through
incentives

for lower costs new bundled products. This
strategy

must be
emphasize

that these are new product
s that cannot be compared with the older versions, or else
there are
significant

risks to
cannibalize

the
existing

revenue stream with new
discounts
, or
alienate

current customers who perceive that they are paying more than new customers.

To
entice

the cus
tomers, the organizations should also offer some minor free software
access for a limited time (i.e. free email, messaging etc for customers who join within the first 12
months). Existing customers should also be offered upgrade solutions to the new produc
ts
through

incentive

pricing, and the training and installs services should make up for these
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discounts

in software (shift from pure software based revenues to a higher mix of software and
services revenues).

Group Sales


To date, the company has not been
good at selling to industry groups. This can be
ratified through significant focus on creating industry solution bundles that can be perceived as
the default solution for certain industries (much like Oracle and SAP has segmented the market
in the ERP spac
e). The first step is to look at the existing
customer

base and find commonalities
among customers in one
industry
. Thereafter rename one of the solutions outlined above as an
industry solution with some new features and a product bundle. After this is don
e, the marketing
should be undertaken
aggressively

to that
industry

with the existing customer base as a
reference. From this position, the company should build new industry solutions with slightly
different capabilities based on the existing platforms (ec
onomies of scope).

7.

JamCracker usage memo

Memorandum

T
o:

John More


CEO of SupplyChainRUs

CC:

Executive Committee

From:

Murtuza Arsiwala, Bjarne Berg, Consultants America

Date:

Thursday,
2/21/2014

Re:

Pros and cons on offering WMS s
oftware as a service on
JamCracker

Objective


SupplyChainRUs have hired Consultants America to provide them with relevant findings
regarding the feasibility of using
JamCracker’s

software delivery service for its Warehouse
Management System (WMS)
-

Dispatc
hRUs. T he objective of this memo is to lay out the
advantages and disadvantages of using
JamCracker’s

On Demand Software Delivery services.

Advantages

The following lists the advantages of using
JamCracker’s

On Demand Software Delivery:

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Using
JamCracker

t
o provide a WMS as a service opens up a new channel for marketing
the WMS to Small and Medium businesses (SMB) segment. Since all the Fortune 1000
companies have or are implementing a WMS within their warehouses, this provides
SupplyChainRUs an excellent o
pportunity to be a first mover in the SMB market.



JamCracker

makes it possible to offer multiple versions of DispatchRUs (versioning) to
target specific verticals such as the retailers, 3PLs etc at different price points



Will result in faster implementatio
n of the product to days instead of months. (reduced cycle
time).



JamCracker

would be responsible for interfacing DispatchRUs service with services that are
used by the customer. This will help reduce support costs and free for
DispatchRUs and

free up engi
neering resources.

Disadvantages

The following lists the disadvantages of using
JamCracker’s

On Demand Software Delivery:



Offering the WMS can result in cannibalization of sales of the regular product. This can be
overcome by offering a scaled down version

of DispatchRUs (versioning). It can be limited
to do receiving,
put away
, 2 modes of picking and shipping inventory.



There is a significant amount of reengineering that needs to be done to DispatchRUs for it
to be offered as a service and fit within the
J
amCracker

ecosystem.



A greater number of transactions are performed in a WMS using wireless radio frequency
terminals capable of running a web browser. Does
JamCracker

need to modify its
infrastructure software to read data from a wireless
terminal?



WMS fu
nctionality is still perceived by the SMB’s as “overkill”.

Questions

These are the list of questions that can be posed to the
JamCracker’s

sales representative who will
be visiting the us the following week:

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1)

How would the Service Level Agreements be moni
tored?

2)

What would be the audit mechanism by which usage of the service can be monitored? (i.e. how
can we verify that we are being paid for the amount of software used)

3)

What are
JamCracker’s

Disaster recovery plans for maintaining an uninterrupted supply t
o the
consumers of DispatchRUs?

4)

Will
JamCracker

entertain or forward us customer details if they need project management
services or product customization?

Conclusion


SupplyChainRUs has realized that WMS systems have a reached a point in their product li
fe
cycle where they are not a source of competitive advantage for its customers and fast becoming
a necessary component in customers supply chain management. Hence the strategy to sell
software as a service using
JamCracker

makes good business sense.

Assum
ptions

1.

SupplyChainRUs have hired Consultants America to do a feasibility study on offering its
WMS Application, DispatchRUs, as a service on the
JamCracker

platform.

2.

SupplyChainRUs is
an

Independent Software Vendor (ISV) offering multiple products for
the
Supply Chain Management and Execution market.

3.

SupplyChainRUs has realized that WMS systems have a reached a point in their product
cycle where they are not a source of competitive advantage for its customers. Instead
customers are demanding (and paying) fo
r more sophisticated Supply Chain Management
(including Business Intelligence) software.

8.

Jam Cracker’s

evolving business Model

Management shakeup

After a ‘near
-
death’ experience in 2002 in conjunction with the collapse of the dot.com
companies, JamCrack
er lost most of its customers. During
the

following
shakeup

of it leadership
in May, JamCracker hired 3 new outsiders to its senior management team. Todd Johnson to
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president,
Mark Kettering to
VP

of sales

and
Kim Orumchian to
VP
marketing and product
deve
lopment.

In 2003 they split the latter role and also hired
Brent Arsla
ner as VP of marketing
and let Mr. Orumchian concentrate on rewriting its software as a
consolidated

package with
standardized

Application Programming Interfaces (APIs). This was launche
d in later under the
name “PivotPath”.

During the last 5 years, t
he business model of

JamCracker has evolved substantially and
they have taken an active
role

in creating products instead of software components
(productizing) and is now
sell
ing

its infrast
ructure (framework) to ISV’s, bundlers etc in addi
tion
to being a ASP aggregator.

Their stated objective is available on their website (requires log
-
in)
as “
JamCracker

Service Delivery Network (JSDN) is an ecosystem that brings together
providers of On Dem
and services and solution providers. It greatly extends market reach for On
Demand services through a Marketplace from which Service Providers can rapidly source,
bundle, re
-
brand and deliver the services to consumers
and downstream channel partners”.

Cur
rent Core Offerings

From a product offering, the company now segments their offerings as IT services,
Business

Services and Industry Services with dedicated solutions to each of these areas. The
summary of service offerings are presented in the table below
:


Current Service Offerings of JamCracker (as of 10/2/2006):

IT Services
Business Services
Industry Services
Collaboration (4)
Business Process Management (7)
Education (9)
Content Management (5)
Business Process Outsourcing (2)
Financial Services (22)
Hosting Services (9)
Customer Relationship Management (45)
-- Web Services (12)
Managed Services (21)
-- Customer Support (2)
Government (4)
Network & Systems Management (3)
-- Marketing Automation (2)
-- CRM (1)
-- Storage and Disaster Recovery (2)
-- Sales Force Automation (4)
-- ERP (1)
Open Source Infrastructure (11)
-- Web Services (36)
Healthcare (4)
Productivity (9)
Enterprise Resource Planning (8)
Mortgage (4)
Security (17)
-- Finance (4)
Professional Services (6)
-- Anti-Virus (5)
-- Human Resources (2)
-- CRM (1)
-- Email (6)
Mobile (2)
-- ERP (2)
-- Firewall (3)
Product Lifecycle Management (1)
-- Intrusion Detection (1)
Project Management (7)
-- Spam Filtering (2)
Supply Chain Management (1)
SOA Infrastructure (1)
Software Testing (2)
Technical Support (5)

Core IT strategies



JamCracker

has employed three core strategies for their business between 2001 and
2006. First the company has expanded their product offerings by signing up more products
and
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also encouraged companies to bundle their offerings into solutions. An example of this is the
company called “Secure your Company
Inc
.” This company
bundled

MacAfee’s

products as well
as
monitoring

software and firewall ASP services to an overall packa
ge for companies to secure
their IT infrastructure.
Also, in December 2003 the company
launched

PivotPath as a shared
platform with APIs after re
-
tooling the company for two years, according to the CEO,
K.B.
Chandrasekhar
. The new tool also include “
busine
ss modeling tools designed to help software
companies work out the pricing and cost structure required for a hosted application business

and a log

for
data center
s

to obtain
recommendations

for

application
-
hosting procedures.
According to
Brent Arsla
ner,
marketing VP, the company
now
require a
n

up
-
front license fee or
a percen
tage of follow
-
on sales.”


A second
strategy

has been to provide more than web enabled productivity tools.
JamCracker can now also provide basic ERP solutions for companies as a SaaS

offering
. This
strategy, known as ‘expansion of the Value Chain’ has allowed JamCracker to enter the higher
end corporate
market, thereby establishing themselves as larger player in the ASP and SaaS
market. The latter also shows how JamCracker has extende
d their existing tools to be a
marketplace for more than ASP providers.


In July 2004, the company redefined their strategy to also enter into the host market for
companies. This

extension

of the business model is intended to create Economies of Scope, a
s
they are using their core offerings to attract new clients and end customers.

The basic 20 it
strategies

and the 3 employed by JamCracker
are

outlined below:

Core strategies Employed by JamCracker (2001
-
2006):


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Recent Activities


In
November

2005, the c
ompany launched a new delivery network with 20 “channel
partners” that are working together to provide comprehensive solutions and an active
marketplace

for hosted, ASP and ISV solutions. They pointed to the company
SalesForce

that is
successfully providin
g a niche, but similar
software

solution. The idea with the channel partners
is to have a readily set of experienced
resources

that knows the tools and which can help
companies install and make the
technology

work.
Overtime

this may become a significant sa
les
argument and
strength

for JamCracker that sets it apart from its competitors.