How can Software as a Service help your company?
Small businesses have to leverage each dollar spent to maximize return and software is often one of the major expenditures. Traditionally, software was based on the individual computer or on a server. For example, Microsoft Word is installed on each individual computer in the company and creates documents on that specific computer. Things have changed. Software as a Service (SaaS) is showing its might in areas ranging from document creation to customer relationship management. Examples include Google Docs, 37signals tools, and Linked-In.
There is no doubt these tools are useful, mainly because they are affordable (or free), there are no pure setup costs, and software downtime is rare. Instead of paying for a license per computer, you can buy access based on the number of users, usually totally a far cheaper pricetag. Many companies that offer SaaS have developed simple and easily understood graphical user interfaces - drag-n-drop, tabs with obvious names, and other tools. These are great reasons to use SaaS and I agree, they are compelling. Nothing sounds better than using software that appears to level the playing field by a wide margin between small business and behemoth corporations.
However, there are some downsides to consider and they are quite real and quite problematic for small companies. One is the matter of proprietary and confidential information. Almost anything can be considered proprietary (client lists, schematics, etc); the same applies to confidential information. Does your SaaS provider have quality security? Do they also effectively back up whatever information you’ve given them? Is there any way for you to do an independent backup for your information (aside from paper printoffs)?
What happens if there is a billing tiff? And the SaaS company cuts you off from your information?Any service agreement needs to be examined closely with a mind for these matters.
Another issue is the customization capability of SaaS. Most vanilla modification abilities are available, but what if you need to cater software to extremely specific uses? The other side of this issue is that money saved on basic services can be reallocated to area-specific and customizable software.
Finally, one area that should probably be avoided for SaaS is the company’s financials. It is very much in your best interest to maintain ownership of your financial and economic information.
The moral here: evaluate SaaS for your own needs. If the service fits and you trust the provider and the agreement, by all means use it.
