SAS UK boss talks SaaS, innovation and his first 90 days in the job...

A sense of responsibility
I think particularly when it comes to how we run the business commercially, that if we take a view around the world about the markets we need to grow or make investments in, there are going to be times when we want to reduce our profit expectations and invest more to get longer time growth, and there are going to be times it'll be the other way round. We've got more flexibility to choose how we do that. We agree targets that are sensible for the time and the place and the market space that we're in.

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Right now in the UK I want to invest significantly in the business because I think when the market gets tough - and it's fair to say it is getting tougher for people in the enterprise software world - SAS as a company tends to thrive and so we invest through those harder times and we tend to come out on top. We're doing that right now and I think in a privately held business those decisions get taken for the long term.

Trends in the software industry
We've seen a huge amount of consolidation. It's not a technology trend as such, it's a business trend, but I think it has some big implications. As the software industry does consolidate, where's the innovation going to come from? The large players are not always very good at that and the software industry over the last twenty years has thrived on having well-funded start-ups - some of who will not survive - who grow rapidly based on bright people on the technology side and aggressive folks on the sales side.

I am concerned that as the market consolidates that we won't see as much innovation - and in particular with perhaps the squeeze on credit that we have in the current market. So I think the trend towards consolidation is going to have an impact.

I think the trend for SOA and the like is well established. There are some big concerns around the complexity of software now and I think there's a big responsibility on the vendor community to focus on quality and support as systems get more complex. It's an area we've always put a lot of effort into and I think when you see complexity, new technology models and consolidation all going on at the same time one can conclude that big customers are going to be concerned that companies gobbling up smaller players [won't] be able to provide the level of support that they need.

SAS on SaaS
We've provided hosted solutions - so software as a service - predominantly in the US market for about seven years. We know it's a growing area in market, we know the IDC market figures, its $10bn market by 2009 - all that kind of stuff. We've grown quite a successful business in the US. Based on that, what we are doing right now - and we haven't taken a final decision - is looking at whether we can deploy that model here in the UK. I do think there's a business case there and that's what we're looking at.

[SaaS] plays well for us in the sense that as a software company, our business model has been a subscription-based business model from the day we first started 30 years ago. So we haven't been a company focused on selling perpetual licences - the business model for us is based on subscription - so in that sense it's less a decision about software as a service, it's more a decision about whether we host.

On the horizon
We want to expand our partnering-based approach. HSBC is an example of how to bring a new solution to market - we partnered in a very different way with a major customer. We signed up with them on a venture over a 15-year period to build a new solution, implement it, then take it into market. It's a reflection that solutions need more and more industry content and be more customised to specific industries, niches or business problems. That's gone well, to the extent where we've now signed up a second customer which is HBOS.

In terms of what we're doing in the UK, what you will see is a couple of big examples like that where we're moving our partnering model with customers to a totally different level. For us, partnering and innovation in the way we partner is going to be key.

Experience in military
Coming from a military background into a software company is not a natural progression but actually there's a whole load of disciplines that one gets used to. But I think the military stuff is less relevant. You can't run a modern IT-based business using those disciplines it's very, very different.