ISVs should follow best practice guidelines and approaches for innovative software product research and development , marketing, sales, customer service and operations to reduce their software development time and cost , improve software quality, speed-up their time to market and improve customer acceptance and satisfaction. In addition, ISVs should leverage proven PaaS (plat form-as-a-service) and IaaS (infrastructure-as-a-service) and off-shore providers to improve their financial, operational and technology performance and gain competitive advantage.
For example, sales and marketing is traditionally the largest expense for SaaS companies. Sales and marketing estimated spending in 2008 for 13 leading SaaS companies averaged about 28% of revenue according to RBC Capital Markets Group research. The sales and market expenses for the 13 companies ranged from 17% to 49% of revenue. Examples of companies that were more efficient in 2008 relative to their projected revenue growth rate compared to the amount of their sales and marketing expense as a percent of revenue were Absolute Software, Omniture, Concur, Ultimate Software, and Kenexa. The estimated median organic revenue growth for 2008 was projected to be 25%.