For years, the acquisition of data through Software as a Service, or SaaS for short, has been gaining ground in the market. The continuous positive economic development, the willingness to invest in new IT solutions and the growing competitive pressure will continue to make rental software the focus of attention for SMEs, with all the advantages and disadvantages.
Software, licenses, maintenance, hardware – a complete package without worries costs companies thousands of euros per month or per year. Software as a Service (SaaS) offers some advantages over the classic software delivery process, but also disadvantages. Therefore, it is not worthwhile for all companies to enter the new world of software. In short, the following three pillars are undoubtedly among the advantages of using SaaS: cost savings, high system flexibility, and ease of implementation and operation. However, these pillars also contain negative aspects that medium-sized companies must take into account. At the same time, the pillars represent the economic advantage of these cloud solutions.
What is SaaS? Software as a service is part of cloud computing. The SaaS model is based on the principle that software and IT infrastructure are operated by an external IT service provider and used by the customer as a service. To use online services you need a computer with an Internet connection and an Internet connection with an external IT service provider. The software is usually accessed via a web browser. The recipient of the service pays a usage-based fee for use and operation. The SaaS model partially saves the service recipient the purchase and operating costs. The service provider is responsible for the complete administration of IT and other services such as maintenance work and updates. To do this, the IT infrastructure, including all administrative tasks, is outsourced and the service recipient can concentrate on its core business. Source Wikipedia
Cost savings in SaaS
With Software as a Service, the cost advantage is an important argument. Before moving from internal software licenses to a SaaS service, companies want a transparent presentation of the expected costs. In most cases, providers are transparent enough from the outset to present all costs. It is worth mentioning that internal IT departments typically spend 60 to 80 percent of the existing budget on maintaining internal systems. Follow-up costs for maintenance and upkeep are also unpredictable. A look at the SaaS concept is especially useful for start-ups. In the start-up phase of the respective company, enormous investments are required (infrastructure, development of know-how, acquisition of licenses), which should actually be avoided from the outset.
A detailed invoice provides the respective software lessee with an overview of the variable and fixed costs incurred by the company. Variable costs, in particular, are interesting, because, on the one hand, they describe the additional costs, but on the other hand, they also represent a modern and necessary flexibility. By avoiding the risk and flexibility of your own capital, SaaS allows you to concentrate more on your own core competencies and therefore adapt your IT skills and resources to suit your needs and thus spend more time with your own customers. In short: software must be efficient.
Advantages of SaaS for users
– Focus on the core business
– fluidity
– In the meantime, a high selection of suppliers
– Costs are scalable
– Based on a consumption-oriented billing model (payment as used)
– Allows for short implementation times
– Reduces complexity
– It eliminates the need for customers to spend money on maintaining the software they use.
– The risk rests with the provider
– Short notice periods
Disadvantages of SaaS for users
– Dependence on the service provider
– Requires evaluation of the supplier with respect to seriousness, reliability, and reliability.
– Requires full contractual regulation of all aspects of service provision, content, and services.
– Conditional a clear contractual regulation of data transfer at the start of the project as well as data return at the end of the contract.
– Premium adjustments, connection charges
– Standardization instead of innovation – not a solution tailored to customer needs
– Data security, encryption
– Internal adjustments
– Even short notice periods
SaaS Flexibility
As a general rule, flexibility is much greater with an on-demand solution than with a self-exploited solution developed and maintained on-site. The term flexibility should not only refer to flexible applications and adaptive subscription models; the presentation and export of data, as well as usability, should also be taken into account. In this way, the software will continue to serve employees in the future. If the company can use the software flexibly independently of the order, the employee is not further restricted as a result; only then is the use of flexible and advisable. No matter how a company decides: SaaS models are especially suitable for growth phases. Individual applications and functions can be used independently. They can be added or removed as required. Adaptation to the new conditions is economical and time-consuming, so it is important that the vendor takes care of the software updates at no additional cost.
SaaS Implementation and SaaS Management
The simplicity of this results from the fact that the company does not need its own IT infrastructure. No development time, no coordination with other IT systems – the provider usually guarantees trouble-free operation; for a system that works on a permanent basis. Only an Internet connection and a PC are needed to access SaaS. Advantage: The work can also be done outside opening hours and the system can be accessed from outside. Companies must ensure that the connection is always encrypted. Therefore, the level of encryption must be compared with that of other providers.
As far as handling is concerned, the supplier must ensure that internal and external communication is possible through the same platform. In addition, the data backup should be self-evident and automatically regulated. A good possibility and a sign of flexibility: adaptations and extensions should be possible to be made by the company itself. When it comes to usability, it is extremely important that older employees are also picked up.