7 things you should know about SaaS
Software as a service (SaaS) may have entered companies discreetly, but year after year, it is becoming more important in technological infrastructure. It is an alternative to internal operations and outsourcing that companies can and should incorporate to provide better services and to also make their IT infrastructure profitable.
SaaS can offer high quality services at a lower cost than other alternatives, and it is particularly good for supporting mobile and geographically decentralized users, whether they are employees, teleworkers, customers or business partners worldwide.
Below we have answered a few basic SaaS questions that IT users and businesses should know.
1. What is SaaS (Software as a Service)?
Software as a service (SaaS), is a model for implementing commercial services, this normally consists of an external party who creates and hosts applications, making them available to customers through a browser.
SaaS generally uses a multi-user architecture, sharing a single instance of an application and a single user database among all customer services. This model provides huge economies of scale, which often allows SaaS providers to sell services at a significantly lower cost than traditional external providers, offering superior return on investment to customers.
Advances in technology allow SaaS providers to provide unlimited amounts of user interface customization, functionality and even data structure. The software knows the identity of each user and consults a personalization database to determine which features to apply.
However, SaaS solutions generally do not provide the full customization that would be available with the internal installation of a complex software package. This is definitely, one of the things that users who are considering SaaS should consider. They should determine whether their company can live with the customization that SaaS supports.
2. What about security?
If our data shares a database with other organizations, possibly including competitors, how can we be sure that we are safe?
The security solutions offered by SaaS vendors are of the highest level, and the danger of corporate espionage is virtually non-existent. In some cases, some SaaS providers can even store critical data within firewalls for those clients that require it. Obviously, this is another element that potential users should bear in mind, and many will prefer to keep some data and applications internally for security reasons. On the other hand, internal corporate security is also not perfect.
3. How do SaaS providers charge?
Typically, it is a pay-per-use subscription service. The price per user per month is the most common model. The price per transaction is another. There is a wide variety of options, all flexible and adjusted to the actual use of the solution. This is one way in which SaaS differs from outsourcing. It allows an organization to try a solution with little risk, because the organization is not committed to a three-year fixed-rate contract, or has not made a large initial investment in hardware and software licenses. However, SaaS providers generally offer significant discounts to customers who make multi-year commitments.
This pricing model can also make SaaS a better option for fast-growing companies that anticipate great growth in the use of their IT infrastructure and for services with large annual fluctuations in demand, which is very common, in retail, for example.
4. What kind of services do SaaS providers provide and how do they provide those services?
Companies such as Salesforce Inc. (CRM), Recordia (recording interactions), Taleo Corp. (human resources), NetSuite (SMB Suite), eComFax (Virtual Fax) and RightNow Technologies Inc. (CRM) offer a wide variety of services that cover both end-user functionality and IT infrastructure, network security, email and company collaboration. The latest trend in the development of SaaS services is to provide a complete set of IT services, “everything a company might need,” on a single unified platform.
These services are delivered through the Internet and are generally accessed through a browser from a computer or mobile phone. This makes them ideal to support users or sales reps on the go, etc. Currently, there are different interfaces for mobile workers, for example, Salesforce is targeting the sales community, and they are, of course, mobile. They have very good support for any type of smartphone, smartphone or mobile device.
Because they are delivered over the Internet, this also makes them ideal for decentralized, geographically distributed and virtual organizations that go beyond corporate boundaries to unite business partners and offer advanced services, such as financial analysis, to customers .
5. How is the current SaaS market?
The market is in its initial phase of high growth, having passed the turning point in the typical scenario of the high-tech market. It is characterized by a large number of fairly small vendors, and increasingly are constantly entering. Some very large organizations, such as Amazon Web Services, Microsoft and IBM are helping their business partners, particularly independent software vendors, to the growth in the number of providers that move to the SaaS market.
6. Is SaaS just a trend?
We believe it is the future of software, or one of the important elements in the future of software. The traditional license model cannot be completely ruled out, but there is certainly a strong economic and efficiency argument that favors SaaS in the market.
7. What participation, if any, should users of the service have with the provider once the contract is signed?
Users should be very involved in the functional evolution of the SaaS offer. In other words, the user must actively participate in the community and user conferences, because the evolution of the software is driven more strongly than in any previous generation of software by the comments of the buying community. In fact, some SaaS providers have suggestion boxes built into the user interfaces of their software.