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Determine the cost of app customization in the cloud

Cloud applications are like icebergs: There's a lot users don't see below the surface. One apparently small change could have a massive ripple effect on operations.

Applications and tools are shifting rapidly toward a cloud-based, software-as-a-service model and away from custom installations by each user. For companies that heavily customized an application from the base installation, this pivot to the cloud doesn't come easily -- especially in terms of user expectations and costs.

When operations teams need to replace or migrate unique applications to a SaaS version -- either by choice, or because the software vendor moved to a cloud-based model -- issues often arise. The SaaS application simply won't have the same personalized options that the older system had. Some of those cut features might be seemingly minor -- such as a custom report -- but the effects of losing them can run deep. That simple report might be perused daily by the management team, or relied upon to determine customer billing.

Frustration sets in, particularly as IT operations teams attempt to balance the costs of SaaS app customizations with user demands.

The customization cost challenge

When a software vendor designs an application for SaaS, it aims for a common base of features to appeal to the greatest possible user base. This enables the vendor to scale out more easily -- and to charge for any app customizations built on top of that standard feature set.

For operations teams, this represents a delicate balance; while it's possible to customize most cloud-based applications, it often comes at a premium cost. Even the simplest feature addition can require extensive reprogramming to get both the app and new feature to function as desired.

The technical change, such as a UI adjustment or database field reconfiguration, is only the tip of the iceberg. Accompanying these efforts is the potential for negative effects: Does a small change affect another function or degrade the app's overall performance? While an app customization appears small in scope, it could require a universal change on the back end that moves the scope from minor to major. Expect significantly more effort for the app provider to equate to significant cost for your organization.

Listen carefully to end users, and understand the specific requirements they have for an application. Those users are experts in what they do, and it's up to IT operations to recognize that expertise and then explain the costs of requested app customizations. If a user needs a specific feature, and the IT operations team determines the required customization will affect projected budget for this application, it's time for an open conversation.

The cost of a change is fixed in hours and cost per hour, but its effect is subjective. Ops must place value on the change's projected effect on the user base and determine through metrics and projected area of effect graphs whether the cost will pay off in the long run. Streamlined processes that result in time savings, for example, reduce costs over time. Better insight into processes or reporting can show quantifiable value for the business. This data help ops build a case for app customization, especially if the seemingly small change presents a much larger effort and cost footprint than originally thought.

Explore together whether the feature is absolutely necessary, and how the customizations will ultimately affect the business. If the app customization is deemed necessary, both the end user and operations can present their case to management.

The planning time and meetings to determine value can drag out the process. To be more efficient, host open listening sessions with groups of end users. Engender a two-way dialogue where IT teams can explain the upcoming changes to a major application, and end users can voice concerns and questions about the effects those changes will have. Through this back-and-forth, operations can begin to prioritize customizations.

Many long-established applications will require this process before a move to SaaS. Overall, IT teams should expect to face more political problems than technical ones. Listen to user concerns, balance them with customization costs and share related data openly.

This was last published in February 2019

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