What is SaaS? Software as a Service (SaaS) is a distribution model in which applications are hosted by a third party vendor or service provider over a network, typically online – and delivered “as a service” to end users.
Web-based email is an everyday example of SaaS. Instead of uploading software to a computer or tablet, it is hosted on the Internet and accessed via an internet browser, largely insulating the user from the underlying technology.
SaaS software can be integrated quickly, creating a more efficient internal process that drives productivity. The vendor takes care of the daily technical operation, maintenance and support for the software, eliminating the burden on internal IT departments and lengthy delays that can result for business users.
Today there are many types of business applications available, delivering not just traditional email and calendaring solutions, but which also target key industry verticals and specific business processes. A virtual data room is an example of a SaaS business application.
SaaS has advantages that translate directly into business value.
• Broad network access: Services are accessible from multiple devices (including PCs, smartphones and tablets) and any location with Internet access
• Resource pooling: Computing resources are pooled to serve multiple customers, which creates significant efficiencies and economies of scale. Resources are deployed based on demand, and customers generally don’t know (and don’t need to know) where those resources are physically located
• Rapid elasticity: Cloud computing capabilities are essentially unlimited and can be quickly scaled up or down in response to an organization’s changing needs
• On-demand: New services and capacity can be provisioned quickly and easily
• Measured service: Businesses only pay for the cloud services and resources they actually use
Technical advantages (which translate into additional business advantages):
• Rapid implementation: Less time is required to get up and running on cloud-based systems
• Cost predictability: Cloud’s pay-as-you-go model, which includes the cost of system upgrades, makes it easier to predict IT costs
• Balanced ROI: Cloud delivers a faster return on IT investments, thanks to accelerated implementation and reduced infrastructure costs
• Agility: Companies can quickly develop and deploy new IT capabilities and business processes to stay ahead of the competition and keep pace with changes in the marketplace
• Scalability: Cloud provides a flexible platform that can grow or shrink as needed, enabling businesses to explore new markets, pursue new innovations and serve new customer segments
Is SaaS Better than the Alternatives?
SaaS products are well tested in an optimized production environment. Unlike a customized Sharepoint platform or a client/server project, there is little risk of encountering custom code bugs or self-hosting issues and downtime.
Some SaaS providers offer pilot agreements, which allow the purchaser to test the product before investing any significant time or money, reducing the potential for the software to become shelfware and a write off.
Most importantly, “best of breed” SaaS products are often easier to use than clunky self-hosted platforms, so the user adoption rate can be rapid, and, at the very least, evaluated prior to making large financial commitments.
If a business is ready to embrace SaaS, there are 7 Things Business Leaders Can Do To Prepare For The Move.
Content courtesy (in part) to Deloitte, with special thanks to Paul Clemmons, Jason Geller and Adam Messer