ASPs can help a start-up quickly gain altitude

By Denise Pappalardo
Network World, 12/11/00

Getting a young company off the ground quickly can be a formidable task, which is why Intraware turned to an application service provider for help launching its sales force.

Intraware's trials and tribulations of keeping its sales team on one centralized system is the subject of this final installment of a three-part series looking at the experiences of ASP customers.

Intraware was founded in 1996 and went public last year. After deciding to use Siebel customer relationship management (CRM) software as its sales force automation platform, the company soon realized its internal IT resources were too strapped. Outsourcing the application seemed like the best option in to allow existing IT staff to work with Intraware customers, says Shaun Fenn, director of sales IS.

"This was the first application we outsourced," he says. "We have a lot of applications that were built in-house and senior management had some trust and ownership issues that we had to overcome."

Before the shopping process started, an internal committee was set up that consisted of representatives from various departments. The group hashed out what was needed and expected of an ASP partner.

Intraware wanted to outsource Siebel and PeopleSoft enterprise resource planning applications to one ASP when it first started shopping around about 15 months ago. But at the time the market was immature and Intraware had to team with two ASPs. Another team focused on getting PeopleSoft online while Fenn and his group concentrated on Siebel.

After looking at five or six application hosting and outsourcing companies, Intraware chose USinternetworking (USi). "They were clearly the best fit for us," he says.

USi set up multiple servers supporting the company's CRM application in its data center in Milpitas, Calif., near Intraware's headquarters. Intraware connects to the data center via a local dedicated T-1. Intraware has set up a dial-up remote access server that uses digital certificates and encryption so employees can access the application server while traveling.

Challenges along the way

But this VPN setup has not been easy for the company.

"Our biggest problem to date is reliably accessing the data housed within USi," Fenn says. "We've had [network address translation] issues that have prevented some users from getting onto the server, but we're close to 99% connectivity at this point."

Fenn says he and his team are partly to blame.

"Something we didn't have going in was a clear data model, which I highly recommend," he says.

Notifying the ASP as to how the majority of employees will access the applications from an established location or from the road is important to spell out in the beginning, he says. Next year, Intraware may switch to an Internet-based VPN system after Siebel rolls out its Web-enabled client, but it's difficult to plan for that when the software is not available, he says.

Ensuring that the lines of communication stayed clear was also a challenge.

"Because we're a start-up, we're constantly moving very quickly, yet struggling to keep USi up to speed with our changes," Fenn says. "We had weekly conference calls with USi to update us on every issue and also to update them on our changes."

As Siebel was coming online, Intraware was changing its sales team structure, which directly affected software configurations. "For instance, one month the sales folks may have been vertically assigned and then they were territory assigned," he says.

"It was difficult keeping USi on the same page. . . . Our lack of structure really hurt our Siebel implementation," Fenn adds.

Intraware also needed to sign on experts to customize its Siebel software.

"ASPs like to stamp out configurations, at least that's been our experience," Fenn says. "And of course, those configurations don't work for every business model."

Intraware used Siebel consulting services to tweak the CRM application to Intraware's needs.

Need solid SLA

One of the company's biggest concerns had to do with setting up solid service-level agreements (SLA). Intraware has a 99% application availability guarantee. "But connectivity, not availability, is our biggest issue," Fenn says. "So the ASP's guarantee is a wonderful thing within the data center, but doesn't apply to factors outside the data center."

"I strongly recommend getting an SLA that's more related to connectivity or your business model," he says. "The ASP needs to feel the pain when you do."

Intraware is an early ASP customer and has gone through a lot of learning with USi, Fenn says. While not seeing huge cost savings, the company expects to save some money down the road. "That's one of the reasons why we signed up with an ASP," he says.

"We have learned the hard way that sales force automation is an environment, not just a project that you walk away from once it's installed," he says. "If I knew some of the things I know now back when we started, we'd be in much better shape."