How Does Jamcracker Fit In the Asp Space?

Question 1: How does Jamcracker fit in the ASP space? Identify two - three challenges that Jamcracker must address to create a sustainable business model. 

Jamcracker’s business model pivots around the concept of giving its customer a one stop solution for all their business needs. It is an ASP aggregator acting as a bridge between the ASPs and the customers helping both the parties in the process. For consumer it gives them the flexibility of choosing services according to their needs with faster implementation, cost reduction and 24*7 support. For ASPs it facilitated them to concentrate on their core competencies and outsource other extra activities like customer acquisition cost, broadening of their offerings and scale to companies like Jamcracker. Jamcracker has a first mover advantage in the ASP aggregator space and they should use their business model to gain the maximum competitive advantage.

Jamcracker has a few challenges in front of them which needed to be addressed to create a sustainable business model. The challenges faced by Jamcracker can be sub divided into two parts.

• Short term challenges
• Long term challenges

Short term challenges:

The ASP aggregator industry is in it nascent stage and there is lot of apprehension about it from a customer perspective. To overcome this Jamcracker must educate its customers about the benefits and advantages of this emerging trend. Most of the ASPs in the market are not standardized and integrating all those into Jamcracker environment pose a technical challenge for Jamcracker. Also migrating customer legacy system to ASP will lead to compatibility, configuration and setup challenges.

All these are classified into short term challenges because all of these problems are due to the nascent stage of the industry. Once consumers and ASP provider becomes aware of the ASP aggregator industry most of these challenges will subside.

Long term challenges:

In addition to the above mentioned challenges Jamcracker should address the following challenges to sustain their business model. The long term challenges can be classified as follows:

Security: The most important challenge that Jamcracker need to address is the security concern of its customer. Customer are generally apprehensive about the security of their classified data. Security from virus, worms, hacking is a major concern and most of the aggregator take care of those, what they miss is providing security mechanisms within the team. For example, in a single organization within a team there will be documents which should be accessible to specific persons and not to everyone.

Reliability: Jamcracker aims to provide their customer a one stop solution for all their needs, but the question most of the customers will be asking is how reliable is the Jamcracker application. For example, what happens if Jamcracker application crashes. Is there any data backup plans available, what is their average downtime, how does Jamcracker plan to address customer issue in case of any major server or application issue?

Regulation: Another major challenge that Jamcracker must address is of legal and regulatory barriers of information and data sharing. Data and information sharing laws varies from countries to countries and Jamcracker’s business model thrives on sharing of different services among a large group of customers from varied industry. Thus without proper knowledge of the relevant regulatory laws Jamcracker’s business model might face legal hurdles.

These challenges are classified into long term challenges as Jamcracker need to change or add new features to its existing business model. Moreover, this challenges will need involvement of external parties like governments, service providers and customers. Addressing the above short term and long term challenges will give Jamcracker a competitive advantage and will help them in sustainability of their existing business model.

(b) From a client's perspective (someone who may sign up for Jamcracker's services), what should be the key dimensions along which she must evaluate her decision whether to go for such a service or not?

Following are some of the dimensions that a client would look into before deciding on such a service:

1. Company Growth stage: If the company were a start-up, it would look to cut on its initial capital. Having such a service would convert a company’s capex into opex (operational expenditure) which is a more manageable cost and less risky. A start-up company would not like to invest in capital-intensive projects for several IT capabilities, as it would potentially become a sunk cost. Jamcracker’s services provided an alternative.

Moreover, it took less time to setup Jamcracker type service than to create own setup or outsource the function to several ASPs. Therefore, the company can swiftly start work on its core services.

1. Core/Context Services: As some of the functions like emails, HR Portals, etc. are not core functions of the organization; it was prudent that such services be outsourced. This will help the company focus more on its core business. Jamcracker like services provided these functions under one umbrella and therefore it was easier to deal with one single vendor for such contextual services.
2. Cost Benefits: Jamcracker was providing all kinds of ASP services on single platform to several clients and therefore its costs were lower. It would be cheaper and easier for an organization to associate with Jamcracker than to setup its own internal IT service or to hire several ASPs.
3. Increase in Productivity: One important dimension for evaluation is the impact on productivity. Before implementing such a system, client would like to see how much difference it brings to productivity of individual employees. As an ASP aggregator, Jamcracker not only provides seamless integration of different ASPs but a one stop for all application and a single customer support service for all ASPs. This would decrease the time required by employees to work on different functionalities and merge them. Thus giving them more time to work on their core functions.
4. Flexibility: With a Jamcracker like service, clients had an easier way to choose among different ASP services. Jamcracker would take care of integrating new ASPs with their existing ones and they would just need to see which one they would like to have for their organization. It would also provide them access to newly available ASPs, which they might not be aware of, if each ASP is taken separately.
5. Organizational Changes: One key dimension to look is the changes in organization due to implementation of these services. As a new system is moved in, some of the people, working on old system, may become redundant. It will be essential to see where those people can be delegated and what kind of new function can they be given to handle. For example: A person who would copy the data of new joiners from Hiring software to HR software will need to be relocated as this job would be done by Jamcracker.