SaaS: Is It Right for Your Business?

Every budding corporation requires softwares like DBMS, MIS, HRMS and other ERPs for smooth day-to-day operations. SaaS has eventually become the talk of the town and most application service-providers these days recommend SaaS (Software as a service) solutions for your business.

So what exactly is SaaS and how does one decide if it is right for your business?

In simple terms, software as a service can be defined as a mechanism of delivering software solutions that can be accessed from any device equipped with an internet connection. Then what makes it different from the traditional software?

Traditional software asks for installing hardware and servers within one’s organization. It involves huge upfront investment and needs regular maintenance and support. It is usually bought through a long-term license and the buyer may also have to pay 15% to 20% maintenance and support charges per annum.

On the other hand, SaaS uses a cloud technology instead of installing servers in one’s premises. Unlike traditional software, pricing of SaaS applications is usually based on an annual or monthly fee, which typically includes the software license, support and other services fees. Hence, it is low on budget.

Apart from the cost factor, there are various other advantages that the SaaS users can enjoy which include:

High Acceptance: Everyone today knows to use the internet. With SaaS application being available to use from any device having internet connection, these apps have high acceptance rates.

Distributes cost over time: SaaS softwares do not require a huge forthright investment. Since payments are made in the form of monthly or annual subscriptions it distributes the overall cost over time.

No vendor lock-in: Traditional softwares license usually stretch over a long period of time but SaaS applications involve short-term contracts, usually 1-3 years. So when the renewal is due if one doesn’t feel the need to continue, he can easily opt out instead of getting stuck perpetually.

Other benefits of SaaS range from easier administration, easier compatibility and collaboration since all users have the same version of software, automatic updates and patch management to even global accessibility.

Along with innumerable benefits, SaaS has its own share of limitations too. SaaS applications do not allow high-levels of customizations. They work best in most cases, when bought off-the-shelf.

Another critical factor to be considered is that SaaS is typically accessed by users using a thin-client via the web. Therefore, one needs to have a strong and seamless internet connection for its smooth functioning.

At the end of the day, it all boils down to understanding the needs of your organization and mapping the solution that can best help you address them in both near term and over a period of time. For instance, if you have a highly complex business then on-premise systems have been around longer and will be able to tender more functionality.

On demand softwares, another name for SaaS, are usually recommended to small and medium businesses with fairly straight-forward business processes, which are looking to reduce upfront expenses.

Finally, be aware when negotiating a service level agreement (SLA) with your SaaS vendor. In addition to setting system reliability standards, the SLA should address parameters such as data ownership, security requirements and maintenance schedules.

So, if you’re convinced that SaaS is right for your business, what are you waiting for? Go ahead and pick the SaaS software which best suits your business needs and save yourself the trouble of IT responsibilities thereby concentrating on things that really matter.

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Angel comes with an experience in all facets of Human Resources. An expert in creating training material, Angel has conducted training on a variety of soft skills' topics.