Remember starting up your business and looking for an office? Thinking how to get a car on a business trip abroad? Browsing the Internet for a villa at the seaside for a holiday? In all these cases the solution how to reach the goal without excessive expenses was probably simple – just rent it. Why to save and buy what you need in the years if you can start using it right now?
It’s the save with software. For decades software development was associated with enormous costs. Corporations first earned millions and hired their 1000th employee and only then dared to think about decent software. Things have changed with time.
The concept of SaaS (software-as-a-service) evolved in 1999, and the interest to these products has recently shown accelerated growth, especially in the times of economic downturn.
So, what is software-as-a-service, and why is it popular? Generally speaking, it’s an application developed and hosted by SaaS vendor. The customers can access it remotely via the Internet. As distinct from packaged or custom software applications, customers don’t buy or build software, but simply rent it, usually on a monthly fee basis. It’s easy, it has lower barriers for entry, as well as doesn’t take much time. And, well, these are not the only benefits of SaaS. Here go more.
Benefit 1. The first thing you would probably say about SaaS is “Cool, we don’t have to pay for licenses or development!”. It’s true. But there are much more items to save on. No new service hardware and infrastructure purchases. No extra IT specialists to hire for this application support. Implementation and consulting costs are not totally excluded but are reasonably limited.
Benefit 2. Software as a service accumulates large scale collective intelligence. As these applications are addressed to various businesses, they normally include wide functionality and implement multiple ideas generated by experts.
Benefit 3. Well, most software contains some bugs. And it takes some time for a traditional software vendor to provide response to bugs, at least for the reason that he doesn’t host the application. SaaS provider has direct access to the software and can easily tell how well it is working and promptly fix the bugs.
Benefit 4. Traditional software updates can be painful for clients. SaaS applications are easily updated with no extra effort from your side, and normally go smooth as the software is not customized.
Benefit 5. Your business can be seasonal or it can be subject to changes. Once you temporarily don’t need the application, you can just put it on hold, with no fees charged for this period.
All these benefits combined make SaaS a good option for companies looking for faster return on investment.
But let’s also note that SaaS solutions are not panacea for all businesses. Generally, they work best for non-mission-critical processes and functions. The companies willing to differentiate from competitors through their customer services, or looking for ERP and business intelligence should stick to traditional software. But SaaS certainly has its place in most companies’ application portfolio.
If you are looking for HRM, CRM, sales force automation, warehouse, travel management tools or any other applications that are not highly dependent on or integrated with other business functions, SaaS can be a good a choice to make.
Please, do not hesitate to contact us if you have any questions, or would like to get any clarifications or consulting.
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