4 Things to Consider Before You Deploy SaaS
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SaaS is short for software as a service. SaaS-based tech products are marketed as “hosted solutions” or “web based solutions”, or “on-demand”. The obvious advantage of the subscription-based access is that regardless of size, any company can potentially afford the best and latest business technology. The upfront costs of access are considerably low in comparison to costs associated with licensed software and purchased equipment.
The SaaS market extends across a variety of industries, including retail, healthcare, hospitality, non-profit, real estate, transportation, and professional services. Software applications support accounting/financial services, call center functions, business intelligence, enterprise resource planning, document management, customer relationship management, and more.
Affordable access, also known as lower total-cost-to-own (TCO), provides a strong appeal for the SaaS platform. However, there are contract terms, conditions, and restrictions that may not be suitable for everyone. Is it right for your business? This article looks at some key issues to help you assess the suitability of SaaS for your business software needs.
Be Clear On What Your Business Needs
This may sound like a no-brainer. However, it is worth stating. The best place to start with the decision for or against SaaS is your current and prospective tech needs. The temptation to look first at products and service providers is strong. However, starting with your business needs creates the best context for the choice of product and service provider.
Put your business in a position of strength by doing the necessary internal brainstorming. At a minimum, conduct a thorough needs assessment, including an inventory of current tech, usage, deficiencies, and redundancies. This will clarify issues relating to tech compatibility, short-term versus long-term needs, how to negotiate with the service provider on fees, renewal terms, and upgrades. The information gathered at this phase is vital to a successful SaaS implementation, one that aligns with your business goals.
Adopt a Comprehensive Approach to Cost Considerations
Cost is probably one of the first things that decision makers consider prior to investing in a new technology, especially one that is relatively expensive. This is both practical and understandable concern. SaaS allows the end user to deploy business technology at a relatively lower price without the costs of hardware, updates, and routine maintenance.
However, upfront cost should not be allocated a disproportionate weight in the decision matrix. Depending on the terms of the contract, the long-term cost of software access may include more than the subscription-related expenses. Additionally, the tax implications of subscription-based access versus conventional purchase need to be factored into the TCO consideration. Typically, there are tax advantages associated with licensed software and business equipment. Those advantages are generally eroded under SaaS.
Understand the Data Security and Regulatory Compliance Standards
The convenience of a web-based, hosted solution is a desirable benefit of the SaaS platform. It allows users easy access to business databases from anywhere they have Internet connection. Data sharing, including from multiple geographical sites is expedited.
However, associted with web-based access are concerns about hackers, data theft, and compromised privacy rules.
Securing your business data and ensuring compliance to relevant regulations are vital business functions. U.S. regulatory agencies, such as the Federal Trade Commission (FTC), hold each business accountable for the security of personal, sensitive information in their possession – even if the information is accessed and processed by third parties.
In this context, it means it is your responsibility to ensure that the SaaS solution provider complies with current appropriate security policies and procedures.
Read the Contract in its Entirety
As with all contracts, a thorough understanding of the pricing terms, escalation clauses, renewal, upgrades, penalties, connectivity issues, unplanned downtimes, and other required and optional service arrangements is crucial for beneficial SaaS implementation. A badly executed contract can translate into business interruptions, unexpected costs, and other undesirable consequences.
The easiest way to preempt contract-related surprises is to read the contract document in its entirety. If in doubt, it might be wise to seek the input of an attorney or look for another provider with less complicated contract language.
Conclusion
Relevance and affordability are important considerations in most tech deployment. In tough economic times, budgetary concerns take on added importance. Subscription-based access promises reduced total cost to own, which creates a high appeal for SaaS tech solutions.
To determine if that appeal applies to your business, it is important to conduct a thorough internal needs assessment, and take a comprehensive approach to pricing/cost. Appropriate security, and a clear understanding of the bold and fine prints of the service contract are also crucial to a successful SaaS implementation.
By: Rachel Agheyisi
The SaaS market extends across a variety of industries, including retail, healthcare, hospitality, non-profit, real estate, transportation, and professional services. Software applications support accounting/financial services, call center functions, business intelligence, enterprise resource planning, document management, customer relationship management, and more.
Affordable access, also known as lower total-cost-to-own (TCO), provides a strong appeal for the SaaS platform. However, there are contract terms, conditions, and restrictions that may not be suitable for everyone. Is it right for your business? This article looks at some key issues to help you assess the suitability of SaaS for your business software needs.
Be Clear On What Your Business Needs
This may sound like a no-brainer. However, it is worth stating. The best place to start with the decision for or against SaaS is your current and prospective tech needs. The temptation to look first at products and service providers is strong. However, starting with your business needs creates the best context for the choice of product and service provider.
Put your business in a position of strength by doing the necessary internal brainstorming. At a minimum, conduct a thorough needs assessment, including an inventory of current tech, usage, deficiencies, and redundancies. This will clarify issues relating to tech compatibility, short-term versus long-term needs, how to negotiate with the service provider on fees, renewal terms, and upgrades. The information gathered at this phase is vital to a successful SaaS implementation, one that aligns with your business goals.
Adopt a Comprehensive Approach to Cost Considerations
Cost is probably one of the first things that decision makers consider prior to investing in a new technology, especially one that is relatively expensive. This is both practical and understandable concern. SaaS allows the end user to deploy business technology at a relatively lower price without the costs of hardware, updates, and routine maintenance.
However, upfront cost should not be allocated a disproportionate weight in the decision matrix. Depending on the terms of the contract, the long-term cost of software access may include more than the subscription-related expenses. Additionally, the tax implications of subscription-based access versus conventional purchase need to be factored into the TCO consideration. Typically, there are tax advantages associated with licensed software and business equipment. Those advantages are generally eroded under SaaS.
Understand the Data Security and Regulatory Compliance Standards
The convenience of a web-based, hosted solution is a desirable benefit of the SaaS platform. It allows users easy access to business databases from anywhere they have Internet connection. Data sharing, including from multiple geographical sites is expedited.
However, associted with web-based access are concerns about hackers, data theft, and compromised privacy rules.
Securing your business data and ensuring compliance to relevant regulations are vital business functions. U.S. regulatory agencies, such as the Federal Trade Commission (FTC), hold each business accountable for the security of personal, sensitive information in their possession – even if the information is accessed and processed by third parties.
In this context, it means it is your responsibility to ensure that the SaaS solution provider complies with current appropriate security policies and procedures.
Read the Contract in its Entirety
As with all contracts, a thorough understanding of the pricing terms, escalation clauses, renewal, upgrades, penalties, connectivity issues, unplanned downtimes, and other required and optional service arrangements is crucial for beneficial SaaS implementation. A badly executed contract can translate into business interruptions, unexpected costs, and other undesirable consequences.
The easiest way to preempt contract-related surprises is to read the contract document in its entirety. If in doubt, it might be wise to seek the input of an attorney or look for another provider with less complicated contract language.
Conclusion
Relevance and affordability are important considerations in most tech deployment. In tough economic times, budgetary concerns take on added importance. Subscription-based access promises reduced total cost to own, which creates a high appeal for SaaS tech solutions.
To determine if that appeal applies to your business, it is important to conduct a thorough internal needs assessment, and take a comprehensive approach to pricing/cost. Appropriate security, and a clear understanding of the bold and fine prints of the service contract are also crucial to a successful SaaS implementation.
By: Rachel Agheyisi
