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People and productivity: PwC’s approach to helping clients cope with COVID-19

Who is working from home? Do they have everything they need? Can they stay connected? Are they OK? Companies around the world have been struggling to answer those questions in recent weeks as the COVID-19 virus became a global pandemic and suddenly forced many workers, and their employers, to adjust to remote working. As human resource policies, security concerns, connectivity and productivity have all been challenged, PwC U.S. rolled out a solution to answer the most basic and pressing question: “Are you able to work today?” With a simple interface, a quick and anonymous process, and with security and privacy baked in, PwC’s solution helps clients quickly determine what percentage of their workforce is enabled to work effectively and what percentage has issues with technology, mobility, supplies or well-being. If widely adopted, the solution should pave the way for a second PwC product: an application designed to help track and trace employees in the event of someone contracting COVID-19. In TBR’s view, these paired solutions demonstrate a concrete and immediate response — from idea to launch in five weeks — to some of the issues facing global companies during the pandemic and should set PwC’s clients up to better understand and manage remote working productivity in a post-COVID-19 world. 

First: Confirm status

Every company needs to know whether its workforce can be productive on any given day — an issue that hardly seemed critical or hard to measure at the start of 2020. Now, getting a daily picture of potential productivity has become an ongoing challenge for many companies navigating COVID-19, raising questions around what percentage of the workforce can be expected to be productive. On April 1 PwC launched a solution, Status Connect, to address that challenge while still conforming to privacy and security standards. At its core, the solution allows administrative professionals within an organization to know what percentage of the workforce in any specific geography and/or business group has an issue preventing them from working effectively. With that information, particularly as daily responses turn into trends, a company can deploy additional resources where needed, forecast potential slowdowns, and gain insights into what kinds of underlying problems hold back the company’s overall productivity.

Initially the solution offered employees only two choices, technology and other, in essence to gauge what is challenging their ability to work effectively, but PwC has already expanded the choices to technology, mobility/travel, business supply and well-being. PwC leaders noted that some clients already adopting the solution anticipated needing a more complex set of options to gain meaningful insights, until PwC explained the richness of data insights available across a large population based on a simple user experience. As the firm continues developing Status Connect, it is adding gamification to enhance the sense of community and drive adoption and commitment to using the solution every day, as well as daily custom broadcast messages and company customizations. Notably, the firm has implemented the solution across some parts of the U.S. member firm, but not yet globally.

As TBR has previously noted: “With risk permeating every business conversation and PwC accelerating investments in digital-related offerings, including PwC Connected Solutions, which sits within its Risk and Regulatory Platform business, the firm has prepared for the next wave of opportunities. Trading on trust remains at the core, especially as the politics of data continue to disrupt PwC and its clients. Becoming customer zero keeps PwC consistent with peers, while pulling in risk differentiates, particularly against non-Big Four competitors. But the firm creates a good use case for embracing digital when it comes to managing risk.” PwC is not immune to COVID-19 and all of the workforce management implications that come with it. Adopting the solution internally is certainly the proper next step as the firm strives to protect its spot in the market as the shift to digital operations elevates the strategic importance of risk and compliance functions.

SaaS sweetens the cloud pot but requires vendors to up their ante to participate

‘Best of breed’ spawns diversity in the SaaS provider landscape

The vendor landscape may be consolidating on the IaaS side of the cloud market, but that is not the case for SaaS. Customers are most likely to increase the number of SaaS vendors utilized over the next two years, supported by a number of market trends, including new workload and feature adoption, platform ecosystems, and integrated multicloud deployments.

For workload adoption, there is a leveling of the playing field for which services customers are considering cloud as a deployment method. ERP, for example, used to lag in public cloud adoption but is now much closer to par with often adopted services like CRM and HR. Much of this increased consideration comes from enhanced comfort on behalf of customers for delivering sensitive workloads from cloud providers versus their on-premises data centers.

The other factor is the proliferation of complementary services available via PaaS ecosystems. The most tenured and largest example of this comes from the Salesforce Platform, which supports thousands of ISVs developing and selling solutions that complement and extend core CRM. Salesforce may have been the first, but other SaaS vendors, including SAP, Workday, Microsoft and ServiceNow, are taking the same approach, exponentially growing available SaaS services. The last driver is the continued rise of best-of-breed customer purchasing. For contracting and performance reasons, customers have long yearned for multivendor application environments, and now vendors are actually moving to accommodate that desire. Salesforce’s acquisition of MuleSoft and SAP’s introduction of the Intelligent Enterprise vision are the latest examples of how vendors are supporting customers in choosing and integrating solutions from numerous providers.

 

This special report is part of a series driven by TBR’s Cloud Customer Research reports, for which TBR conducted more than 50 interviews and 200 surveys. These special reports will highlight key trends and topics impacting the cloud industry.

SaaS sweetens the cloud pot but requires vendors to up their ante to participate

Despite the simple graph in Figure 1 depicting SaaS market size, the space remains difficult to sum up. In the eyes of customers, SaaS options are proliferating and spanning a wide swath of business functions and stakeholders. Yes, SaaS is the largest segment of the “as a Service” cloud market—and yes, it will continue to expand. Beyond that, however, SaaS will remain a collection of separate markets, with most vendors specializing in one or two core and adjacent areas, instead of one unified opportunity. Some examples of this fragmented and overlapping landscape include Microsoft leveraging collaboration dominance to reinvigorate its CRM strategy with cloud delivers, SAP returning its focus to SaaS CRM after ceding the market to Salesforce, and Workday investing to build out a financials-focused SaaS business from its HR roots.

The market behaves in contrast to the IaaS market, which is highly consolidated around a standard set of often interconnected services and a small collection of vendors. In the SaaS market, growth will be achieved by new vendors addressing new workloads and features. From a vendor standpoint, there will be greater presence from legacy application providers such as SAP, Oracle and Microsoft, but also plenty of room for more niche providers as functional and regional niches develop.

While SaaS will grow the overall cloud opportunity, the challenge for vendors is that the SaaS opportunity will be more difficult to capture. That is not to say the historical model for SaaS adoption will cease to exist; there will still be SaaS purchases that are driven by lines of business (LOBs), transacted with a credit card in some cases, and deployed separately from legacy systems. At least some of the growth will continue to occur in that shadow IT model. However, much of the growth will be from SaaS solutions that deliver more critical services, are procured by joint IT and LOB teams, and are tightly integrated with legacy systems. These scenarios will require vendors both large and small to up their ante, bringing more sales, integration and support services to the table to win these more complex deals.

Figure 1

Graph depicting SaaS market size by delivery method from 2017 to 2022

‘Best of breed’ spawns diversity in the SaaS provider landscape

The vendor landscape may be consolidating on the IaaS side of the cloud market, but that is not the case for SaaS. As seen in Figure 2, customers are most likely to increase the number of SaaS vendors utilized over the next two years, supported by a number of market trends, including new workload and feature adoption, platform ecosystems, and integrated multicloud deployments.

For workload adoption, there is a leveling of the playing field for which services customers are considering cloud as a deployment method. ERP, for example, used to lag in public cloud adoption but is now much closer to par with often adopted services like CRM and HR. Much of this increased consideration comes from enhanced comfort on behalf of customers for delivering sensitive workloads from cloud providers versus their on-premises data centers.

The other factor is the proliferation of complementary services available via PaaS ecosystems. The most tenured and largest example of this comes from the Salesforce Platform, which supports thousands of ISVs developing and selling solutions that complement and extend core CRM. Salesforce may have been the first, but other SaaS vendors, including SAP, Workday, Microsoft and ServiceNow, are taking the same approach, exponentially growing available SaaS services. The last driver is the continued rise of best-of-breed customer purchasing. For contracting and performance reasons, customers have long yearned for multivendor application environments, and now vendors are actually moving to accommodate that desire. Salesforce’s acquisition of MuleSoft and SAP’s introduction of the Intelligent Enterprise vision are the latest examples of how vendors are supporting customers in choosing and integrating solutions from numerous providers.

Figure 2

Graph depicting the change in the number of cloud vendors utilized in the next two years

Expectation inflation raises the bar for SaaS providers

There may be a growing pool of revenue and room for more providers, but meeting customer expectations for SaaS solutions is anything but easy. Expectations have been on the rise, stoked by the greater control buyers have with cloud solutions versus on-premises software. The days of long-term software contract risk falling entirely on the customer are quickly coming to an end. Not only has the power dynamic shifted, but, as shown in the graph below, customers are successfully using more of their IT dollars to fund innovation over maintenance of existing systems. As a result, different evaluation criteria are being used for IT investments. Up front, there is a much more collaborative process between IT and LOB teams as they decide which offerings meet their underlying business need, not just what fits into their existing footprint. Calculating the benefits and return from SaaS investments is also a challenging task, as deployments use business outcomes as the ultimate goal. Although hard calculations seem challenging for most customers, it’s clear that enhanced levels of support and “customer success” roles are increasingly valued. Having these post-sale resources available and putting a greater focus on outcomes and other intangible benefits than on technology benefits seems to be the best way for SaaS vendors to meet inflated customer expectations for what the solutions can and should do for their business.

Figure 3

Graph depicting IT investment strategy of SaaS adopters three years ago versus now versus three years from now