Transformation from On-Premise Software to Cloud Computing-Based Services: A Case Study of SAP Practices

Abstract

The enterprise application software market is facing a fundamental change from selling on-premises software products to cloud computing-based services with “pay-per-use” subscriptions. A novel conceptual framework is proposed to analyse this transformation process from the service business model to co-cocreate value across company boundaries. Based on an initial theoretical analytic framework, extant literature, and the resultant conceptual model, I propose a theoretical model‒service transformation business model, comprised of three groups of 13 components refined from the literature on business models, servitization, and cloud computing, particularly business model transformation. The following findings of this study suggest that the traditional software product-based ecosystem has evolved from a PDL (product-dominant logic) ecosystem to an SDL (service-dominant logic) ecosystem: 1) the structures of partner ecosystems are changing, with partners and platform leaders forming a new micro-ecosystem as a basic unit to interact with customers; indeed the cloud computing-based ecosystem has changed the roles, functions, and value relationship among stakeholders; 2) the emphasis has shifted from customer value to ecosystem value; 3) the critical success factors for transformation to cloud computing services are identified under the framework of a service transformation business model. Overall, the results of this study provide in-depth insights that enterprises can use when switching from on-premises software to cloud computing-based services.

Date of Award	1 Aug 2023
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Nikolay Mehandjiev (Supervisor)