Recessions and Expensive Software Incumbents

Earlier this year I had the opportunity to sit down with the executive that opened the Atlanta office a number of years ago. After hearing that the Atlanta office was one of the most successful ones, I wanted to know the secret. What was the special sauce? Easy, he said.

The recession hit many years ago and all these mid-to-large companies in the Southeast were running Siebel Systems with annual license costs that were millions of dollars per year. Combine license costs with staff plus infrastructure and you get a serious line item in the budget. Now for the pitch: cut your overall Siebel costs by 90% and move everything to the cloud. CFOs especially liked this message and took off.

It’s been a number of years since the last recession and SaaS has grown tremendously. When the next recession hits, look for a new wave of SaaS products to run the same playbook and replace the expensive incumbents with a system that’s more modern, and much cheaper.

What else? What are some more thoughts on recessions and expensive software incumbents?

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