1. What is the market gap being addressed by Jamcracker?

It was the time when the service delivery portfolios in the IT industry were moving towards an adoption of Application Service Providers or ASPs, as they were known. ASPs could be any traditional service that a software could offer, however they differed from a traditional software in the sense that they could be hosted on servers which could be located anywhere but accessible over the internet. The security, up-gradation, maintenance and infrastructure costs for hosting these services were handled by the organization providing the ASPs.

Although ASPs solved a considerable number of problems ailing the IT ecosystem of a firm (viz. ease of access and implementation, cost reduction, reducing the risk on IT investments, continuous support and monitoring etc), some of the key major challenges remained unsolved. Selling the ASPs services via direct sales forces cost dearly to the providers, most of the ASPs were specific applications meant to carry out single tasks due to which there was a hesitation in its purchase. Frequent transfer of data between multiple ASPs was a big challenge as well. Jamcracker was based upon a business model which tried to solve these existing challenges prevailing in the market. It utilized the ASPs service delivery across multiple domains (like web mail applications, various CRM & ERP applications etc) and integrated them, providing the access to the user through a single window over the web. It provided all the related technical support system as wellas took care of the billing and maintenance. The customer had a list of ASPs which he could choose and subscribe to on a pay-per-use basis, by just entering into a direct contractual agreement with Jamcracker, instead of the providers of the ASPs themselves. This innovative model cut costs as well as solved the existing challenges to a greaterextent, thereby positioning Jamcracker with a unique upper hand in this upcoming segment.

2. What are the critical challenges for the business model of Jamcracker to be sustainable?

An apprehension grew among the decision makers at Jamcracker about the organization’s success, due to the notion that the market ecosystem was not yet at a stage so as to fully appreciate this new service delivery model that Jamcracker was into. ASPs themselves being a highly dynamic and emerging model of service delivery, the vulnerability of Jamcracker’s model, taking a turn for the worst at any time were looming large. To establish sustainability, the model adopted, needed to adapt dynamically with the changing trends in ASPs. With large multinationals like IBM and Microsoft with huge resources at their disposal, there always was a threat of them catching up, and providing better alternatives within a short duration, thereby eating up the market segment.

Integration of a multitude of ASPs was another challenge for Jamcracker, more due to the sheer complexity and volume of the technical work involved in developing the interfaces

and schemas for data exchange. Since Jamcracker was unique in its domain, it had to devote considerable portion of its time and resources in framing the industry standards for developing interconnections, which was neither its core area nor a revenue generating exercise. Another area which needed a constant revamp was Jamcracker’s professional services delivery capacities. Although they have been doing a fair job of providing the customers with initial technical support etc. however with the growing volume of customers and increasing complexities related to migration of legacy systems data to ASP based systems and their integration, the company needs an exhaustive and scalable structure devoted to providing dedicated support.

3. At the time of the case, what can be the strategy for Jamcracker to move forward?

At the time of the case, it appears that the probable competitors would take some time before they can match upto the offerings of Jamcrackers model. So the organization can afford some time and devote it to strengthening its current processes and structures and build and improve upon the technical challenges, specifically the issues of integration of ASPs, clear segregation of its target segment, defining its story and categorizing its respective offerings. With the targeted projections of revenue by different rating agencies reflecting a favorable ASP market, the organization can sustain its growing footprint and RoI if it can consolidate and deliver on its key strengths (which are its service providing orientation). The organization can well venture into the domains such as consulting, seeing the margin offered and the technical know-how it has gathered over the years.