1. Introduction
This chapter provides an overview of the research subject. It further discusses the aim and objective of this research proposal, and the challenges associated with the subject of study that makes this venture worthwhile, finally posing the questions that this research seeks to find answers to. 1.1. Emergence of SaaS model and its adoption
The evolution of software development has been tremendous over the past half a century. Traditional software development paradigm of creating applications as enterprise legacy systems has been long transformed by possibilities offers by the internet revolution. Specifically in the past decade, cloud computing has been the new trend in the ICT industry worldwide. The whole concept, along with the resulting technologies, takes IT service delivery to a different and intriguing level.
Cloud computing has been defined as 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 cloud service provider interaction (Mel P., 2011).
This concept gave rise to a host of possibilities as regards IT service delivery, including Software-as-a Service (SaaS).
SaaS – a type of cloud computing, is a software delivery model in which software and associated data are centrally hosted on the cloud (internet) and access by the user using a thin client or a browser. It is sometimes referred to as “on-demand software”. 1.2. Relevance of the research
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According to the report by Gartner Inc. (2012), the world’s leading information technology research and advisory company, worldwide software-as-a-service (SaaS) revenue is forecast to reach $14.5 billion in 2012, a 17.9 percent increase from 2011 revenue of $12.3 billion. The report further asserts that SaaS-based delivery will experience healthy growth through 2015, when worldwide revenue is projected to reach $22.1 billion. Geo-economic Region| Market Revenue ($)| Comment|
North America| 7.8 billion| |
Western Europe| 2.7 billion| |
Eastern Europe| 0.1355 billion| |
MEA| 0.1755 billion| Small and emerging markets overall, the potential opportunity for SaaS is more in the medium to long term due to ongoing infrastructure challenges that vendors need to overcome if they are to be successful in these regions.| Asia/Pacific| 0.7309 billion| |
Japan only| 0.427 billion| |
Latin America| 0.3311 billion| |
Table 1.2: Breakdown of SaaS 2011 revenue by geo-economic region – Extract from Gartner Inc. (2012)
The Table above is an extraction from the Gartner Inc. report. The 2011 revenue breakdown by regional designation of markets shows clearly that SaaS adoption by countries in the MEA (Middle East & Africa) region is relatively low. Nigeria businesses belong to the MEA geo-economic region of the world. While SaaS has the potential to have a positive impact on organizations, there has been a noticed inhibition amongst business enterprises in Nigeria to adopt this technology for their IT service provision, partially or fully.
The significance of this study is underpinned by the obscurity in statistical data on the adoption level of SaaS platforms in the Nigerian market. Apart from providing empirical data for global consumption about opportunities for SaaS vendorship in Nigeria, this study will also present facts and figures useful to Nigerian and international vendors about the real factors and obstacles for or against SaaS adoption. Last but not the least significant, the study will provide a platform for future exploration on SaaS penetration, not only into private sector businesses of the Nigerian market, but a country-wide market view.
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1.3. Aims and objectives of the research
The aim of the research is to evaluate the adoption level of Software-as-a-Service (SaaS) technologies for IT service provisioning by enterprises in Nigeria, especially in the private sector. The main outcome is to determine the factors that are responsible for the low level of adoption of SaaS amongst Nigerian enterprises. Adoption of SaaS by an enterprise refers to all instances of use of internet-hosted enterprise applications through subscription. The instances of SaaS adoption is categorized into any or all of the following solution platforms: Management Information Systems (MIS), Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), Webmail, Human Resources Management (HRM).
The specific objectives of the research will include: 1. To determine the level of adoption of SaaS model of software delivery by enterprises in Nigeria. 2. To decide, in order, the factors that discourage the adoption of SaaS model of software delivery amongst enterprises in Nigeria; 3. To identify and evaluate the advantages of SaaS model of software delivery as perceived by enterprises in Nigeria; and, 4. To decide, in order, the factors that could encourage the adoption of SaaS model of software delivery amongst enterprises in Nigeria. 1.4. Research questions
The main questions this research seeks to find answers to are: 1. What is the adoption level (low, average, or high) of SaaS model of IT service delivery by enterprises in Nigeria for each SaaS category and overall? 2. What factors, in order, discourage the adoption of SaaS model of IT service delivery amongst enterprises in Nigeria? 3. What are the advantages of SaaS model of IT service delivery as currently perceived by enterprises in Nigeria? 4. What Factors can drive or encourage the adoption of SaaS model of IT service delivery amongst enterprises in Nigeria? 5. How many of the SaaS adoption instance(s) is provisioned by international vendors and/or service providers. 6. How many of the SaaS adoption instance(s) is provisioned locally through vendors and/or service providers 2. Review of previous literatures
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In discussing the academic perspective of this research, which is formed by reviewing existing literatures on the emergence of the Software-as-a-Service platform and its market penetration trend over the past decade, critical considerations will be given to geo—economic adoptions of SaaS and its different solution platforms. The findings of available reports will be analysed to identify the factors that affect the adoption of SaaS model of IT service delivery by enterprises in Nigeria, either partially or fully. Finally, the fill-in-the gap role of this research is put forward as this section winds up. 2.1. The Transformation to SaaS model for IT service delivery
Software has traditionally been a packaged good that consumers and businesses purchase and install on local computers. Over the past several years, however, we have seen a gradual shift in how software is delivered to customers. According to Deyo J. (2008), rather than building applications that run locally on a computer, software developers are building applications that run remotely on multiple servers, which can then be accessed from any computer with an internet connection.
Verma G. (2010) asserts that the global expansion of internet space during the 1990s led to a new trend of centralized computing. The vendors of these types of services, known as Application Service Providers (ASP), provide businesses with the service of hosting and managing customized business applications. The goal was to reduce costs to organizations through central administration and to provide robust business application solutions. This leverage of cloud-hosted applications development, combined with the service-oriented shift in business processes gave rise to the concept of “Software as a Service.” 2.2. Key Characteristics of SaaS Computing
SaaS model of software delivery is based on the multi-tenancy approach. This enables the sharing of resources and costs among a large pool of users. Major benefits to a multi-tenancy approach to software service delivery include: * Centralization of infrastructure and lower costs
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* Increase peak-load capacity
* Efficiency improvements for systems that are often underutilized
* Dynamic allocation of CPU, storage, and network bandwidth
* Consistent performance that is monitored by the provider of the service.
2.3. The Appeal of SaaS as a delivery model
Farb, B. (2011) list the following as factors that aided, and still aids, the adoption of SaaS by business enterprises for their software delivery provisions: * The benefits of ease and speed of deployment along with rapid return in investment (ROI), less up-front capital investment, and a decreased reliance on limited implementation resources all are encouraging SaaS deployments. * With SaaS, responsibility for continual operation, backups, updates, and infrastructure maintenance shifts the risk and resource requirements from internal IT to vendors or service providers. * A heightened awareness of and growing intolerance for misspent investments on shelf-ware motivate buyers to purchase on-demand solutions. * A shortage of skilled professional resources exists within internal IT departments and systems integrator organizations.
* Lengthy and unsuccessful deployment cycles spur buyers to investigate simpler and quicker alternatives. * Rising maintenance fees, the tendency to evaluate new alternatives during the current technology refresh cycle, and the imperative to update to Web 2.0 technologies all coexist. * The number of executives as buyers or influencers is rising * Buyers face costly upgrades on traditional legacy business application platforms. * Vendors are adding local-language capabilities to their solution portfolios and making investments in local data centers. * Familiarity with the Internet, improvements in security and broader acceptance of service alternatives all are increasing. * Scalability of solutions that allow for incremental expansion of user access as the need arises.
2.4. Theoretical underpinning of the research
So much has been done in the area of statistical reporting of the revenues accrued from SaaS worldwide. Gartner Inc. as industry leader in technology reporting has gone farther with their regular 5-year forecast of the SaaS-market growth. Many reasons have been given by different authors as regards factors affecting the adoption level of SaaS platform in each geo-economic region of the world. Dippenaar et al (2008) asserts, in general, that TCO (total cost of ownership) remains the major factor driving more adoption of SaaS by business enterprises. On the other hand, he also stated that business enterprises are now getting more informed about the huge long-term cost accrual of SaaS adoption, which inadvertently is now making some organizations to back-down on adopting the model. Refering to Table 1.2 above, the reason attributed to the penetration of SaaS in the MEA region is infrastructural challenges in relation to bandwidth cost, favourable ISP service provision etc. The researchers at Gartner Inc. finally posit in their comment that the market in this region is in the medium term to long-term. 2.5. The Gap in Literature
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As informative as the Gartner’s 2012 report was in relation to market sizing of SaaS worldwide, it presents no precise figures and facts country-wise. Very few literatures are found specifically on the state of SaaS market in Nigeria. It is therefore important from the perspective of this study to be able to establish the adoption level of SaaS by Nigerian enterprises and also investigate the inhibiting factors to its further adoption. As such, this research is exploratory. In addition, this research will add to the body of knowledge on what aspect of SaaS platform is homogeneously favored by Nigerian business enterprises. Overall, it is expected that the research findings will provoke positive thoughts amongst stakeholders within the IT industry in Nigeria as to how Nigerian IT service providers, outside their international SaaS provision counterparts, can begin to tap into the huge economic market of SaaS delivery.
3. Research Design and Methodology
3.1The proposed research paradigm
The methodology that will be adopted in this research is a mixed methodology, where qualitative data will be collected through a survey. The research design is cross-sectional as data will be collected at a single point in time from the sample population. The study will track the enterprise SaaS market within private sector businesses in Nigeria from the large-scaled to the medium-scaled ones. Primary data will be collected from organizational respondents who are IT stakeholders in private sector businesses in Nigeria, in the form of questionnaires.
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The data to be collected from the respondents include: Instances of SaaS adoption by their enterprises for IT service delivery in any of these categories – MIS, ERP, CRM, Web mail, HRM; Factors, in order, that discourage the adoption of SaaS model in any of those categories or overall by their enterprises; and Factors, in order, that can encourage the adoption of SaaS model for all their enterprise IT service delivery. For the purpose of achieving the set objectives, I have developed a list of SaaS platforms which instances of adoption will be considered in this study. Also, the selection criteria for organizations will be such that ensures equal representation across business sectors and enterprise scales. To be selected in this research effort, the organizations must meet the following qualifications:
• Be a medium-scale or Large-scale enterprise. In a seminar organized by the Central Bank of Nigeria (CBN), Udechukwu (2003) classified the medium scale and the large scale business enterprises thus: “A medium scale enterprise is as an enterprise with a labour size of between 101-300 workers or a total cost of over N50 million but not more than N200 million, including working capital but excluding cost of land; and Large Scale enterprise – an industry with a labour size of over 300 workers or a total cost of over N200 million, including working capital but excluding cost of land. For the purpose of this research, enterprise classification will be based on Labour size only in the appropriate band. • Carry out business operations in any of the five business sectors, which include Aviation / Travel, Banking / Finance, Manufacturing, Telecom / Media, and Hospitality / Tourism. 3.2The conceptual framework of the proposed research
* Instances of adoption
* Benefits perceived
* Factors for adoption
* Factors against adoption
Percentage occurrence of use within organisations
Ranking of top benefits
Percentage ranking of factors occurrences
SaaS Adoption
Evaluate adoption level
Frequency Tables,
Pie-charts, and linear regression
International best practises in operations management.
A Survey:
50 businesses’ IT stakeholders (IT dept heads, IT officers) Case Study:
Medium and Large scale enterprises Lagos, Nigeria
Deterministic level of adoption of SaaS
Known Factors for and against SaaS adoption by businesses in Nigeria
International best practises in operations management.
Informed SaaS provision for Nigerian business
Clarity of purpose and perception towards software-as –a-service
4. The Proposed Research Method
5.1 Questionnaire design
The survey will be conducted using questionnaires. A soft-copy questionnaire will be design and made editable for respondent inputs. The questions the research seeks to get response to will be mostly closed questions that will require the ticking of checkboxes to give answers. Provision of input boxes for text answers will also be incorporated in the questionnaire for the very few open-ended questions. In general, the following principle will be followed in the design of the questionnaire * The questionnaire will be limited to a three-page word document. * The number of questions contained therein will not exceed 10 * A detail instruction page will be provided on the first page of the question to remind respondents of the research overview and to guide them on how to provide their responses electronically. * Duplication of questions will be avoided
* Only questions relevant to the objective of the research will be included in the questionnaire * The questionnaire will be designed so that the time required by respondents to complete it will not exceed 20 minutes. * The questionnaire will be made visually attractive and structured in a simple to read way for respondent convenience. * Straight-forward and closed questions will be used mostly throughout the questionnaire. 5.2.1 Pilot testing of Questionnaire
A preliminary draft of the soft-copy questionnaire will be sent to through email to a few of the short-listed respondent to test the adequacy and clarity of questions and how they are framed. This pilot testing step will allow for lapses detection and correction in how the questionnaire is designed. Also, the whole research strategy and methodology can be evaluated through this means so that adjustment can be quickly made before data collection. After this testing, the final draft will be prepared that will represent a proper fix of critical areas of the questionnaire exposed by the pilot. 5.2 Questionnaire dissemination
After the final draft is ready and parsed by the research supervisor, the participants will be sent their copy the electronic questionnaire through emails. The covering instruction in the email and first page of the soft-copy questionnaire will guide the respondents as regards how to provide their objective responses to questions posed in an adequately manner without having to print-out a hardcopy of it. After completion, the respondents will return the electronic questionnaire as an email attachment to the address provided by the researcher. 5.3 Sampling method
Fifty (50) business enterprises, which are non-governmental establishments, will be selected in equal numbers from five (5) business sectors. They will also be equally stratified into medium scale and large organisations. The five sectors to be considered in this research include: Aviation / Travel, Banking / Finance, Manufacturing, Telecom / Media, and Hospitality / Tourism. One respondent is selected to represent each of the fifty organisations. The breakdown of the sampling is shown in table 4.1. Organisational sector | Large Scale (25)| Medium Scale (25)| Total (50)| Aviation / Travel| 5| 5| 10|
Banking / Finance| 5| 5| 10|
Manufacturing| 5| 5| 10|
Telecom / Media| 5| 5| 10|
Hospitality / Tourism| 5| 5| 10|
Total (50)| 25| 25| 50|
Table 4.1: Sampling distribution
5.4 Analysis Plan
Base on the specific objectives of the research study, a considerable amount of analysis in this research will revolve around the basic statistical concept of data analysis such as frequency distributions. Frequency table will be generated from the collected data by grouping each data and their number of occurrences amongst the 50 responses. Answers to the open-ended questions will be coded into a definite number so that they can be analysed along other closed question data in the frequency table. The SPSS tool will be used partly to determine issues concerning the linear regression. Information derived from the data will be represented in charts and graphs.
5.5 Ethical Issues
Due to the nature of the propose research, issues of ethics is paramount as people’s participation will be involved gather the required data. Ethics approval is sort from the Faculty of Science and Technology (FST) at Anglia Ruskin University to carry out this research. To this end, an ethics application form has been filled, signed by my proposed supervisor, and submitted to the faculty ethics committee for approval. Also, all participants will be briefed about the research as regards its purpose, objectives of survey and their right of will for or against participation. This briefing will be documented using the standard Participant Information Sheet (PIS).
Their consent will be sort, and documented using the Participant Consent Form (PCF).
At any point during the research, their right to pull out will be respected. The copies of the ethics application form, the PIS, and the PCF is herewith attached in the appendix section of this proposal.
5.6 Proposed Research Timeline
The time line for the research is presented in a tabular form below, with supporting gantt chart figure. A clear copy of the gantt chart is herewith attached as an addendum to this proposal.
Literature Review| 160 days| 03/09/2012| 12/04/2013|
Design of questionnaires| 6 days| 12/09/2012| 19/09/2012| Initial draft| 3 days| 12/09/2012| 14/09/2012|
final draft| 3 days| 17/09/2012| 19/09/2012|
First break (Holiday and travel to meet supervisior)| 14 days| 20/09/2012| 09/10/2012| Contact Participants & receive consents| 10 days| 10/10/2012| 23/10/2012| Dispatch of Part. Information sheet| 10 days| 10/10/2012| 23/10/2012| Dispatch and receipt of participant consent form| 10 days| 10/10/2012| 23/10/2012| Dispatch of questionnaires| 2 days| 24/10/2012| 25/10/2012| meet with supervisor| 7 days| 26/10/2012| 05/11/2012|
Follow up on unreturned questionnaires| 7 days| 06/11/2012| 14/11/2012| Analysis on returned questionnaires| 55 days| 15/11/2012| 30/01/2013| preliminary analysis (sorting of data & freq tables)| 14 days| 15/11/2012| 04/12/2012| final analysis (linear regression and pie-charts)| 10 days| 17/01/2013| 30/01/2013| Second break (xmas and new year holidays)| 30 days| 06/12/2012| 16/01/2013| writing of Dissertation| 45 days| 31/01/2013| 03/04/2013| Proof reading and corrections in writing| 7 days| 04/04/2013| 12/04/2013| printing and binding of dissertation| 8 days| 15/04/2013| 24/04/2013| Submission| 1 day| 25/04/2013| 25/04/2013|
5. Discussion
5.1 Strength of the Proposal
Software-as-a-Service has become a paradigm shift in software delivery.
Nigeria is part of the global village, and Nigerian business enterprises faced with challenges in terms of leveraging the superior software technology available through SaaS. This research is a step to bridge the divide between SaaS vendors and technology consumers in Nigeria. Understanding the issues regarding adoption level of SaaS and factors for or against its adoption in the Nigerian business arena can only provide a win-win situation for stakeholders. Aside this, the research will remove the obscurity in facts and figures about SaaS market within Nigeria – a positive reference not only of business concerns, but also of academic value.
5.2 Limitation of the Proposal
Nigeria is the most populated African country in the world and consists of thirty-six (36) states. Lagos state, located in the south-west, is the economic centre of the country with most business enterprises in Nigeria having at least a branch office or their headquarters domiciled there. Due to the vast geographical terrain, the survey targets of this research are business organisations within Lagos state, Nigeria. The finite numbers of organisations that have no business presence within Lagos state are not within consideration of this research. Howbeit, this limitation in the geographical reach of the research will have infinitesimal effect on the representativeness of the data collected as regards business enterprises and SaaS adoption level in Nigeria. 5.3 How to Mitigate the Limitation
As said in earlier section, Lagos state is the commercial centre of Nigeria, and every large scale enterprises have a presence there either – either a branch office, or a corporate headquarter. The main points of concern are the medium scale enterprises which are part of this research target groups, although a vast majority of business enterprises in this scale of industry do have their presence in Lagos state. A due analysis of the medium scale enterprises distribution in NIGERIA will be undertaken, using available statistics from the chamber of commerce and industry office.
6. References
Dippenaar, J.F. & Butler, R. , 2008. Software-as-a-Service (SaaS): considerations and implications for SaaS customers. [e-version] Stellenbosch: University of Stellenbosch. Available at
<http://hdl.handle.net/10019.1/15037>. Farb, B., 2011. CLOUD EXPECTED TO KEEP RISING. CRM Magazine, [e-journal] 15(9), pp.14-14. Available through: . Mell, P. and Grance, T., 2011. The NIST Definition of Cloud Computing. NIST Special Publication, , pp.800-145. Mertz, S.A.andEschinger, C. 2012. Forecast: Software as a Service, All Regions, 2010-2015, 1H12 Update. Gartner Inc. Rittinghouse, J.W. and Ransome, J.F. , 2010. Cloud computing : implementation, management, and security. [e-book] Boca Raton, Fla. ; London: CRC Press. Available. Udechukwu, F.N. 2003. SMALL AND MEDIUM INDUSTRIES EQUITY INVESTMENTS SCHEME (SMIEIS).
Central Bank of Nigeria. Verma, G., 2010. Software as a Service. ims, [e-journal] , pp.32. Available through: at: <http://ims.edu.in/pragyaan/Pragyaan_IT_June11.pdf#page=37>.
