Software-as-a-Service, or SaaS, is a way for businesses to use software that is hosted by a vendor, and that software is then delivered to users through a web browser on the Internet. That same software or piece of code can be used by many users, regardless of where they are located geographically. Because it can be very efficient and low-cost, SaaS has been growing in popularity over the past few years, but there are many thoughts - good and bad - that exist about it.
Here are three things that you may not have known about SaaS:
1. Security: Many organizations like the sound of SaaS, but have concerns about its level of security – after all, not being in direct control of your data is a legitimate concern. However, security is as important for SaaS vendors as it is for any company. Backups, failover mechanisms, and data recovery systems should be the focus of your vendors. Critical and sensitive data can be kept inside firewalls when needed. Make sure that you probe your SaaS vendors to determine the multiple – and there should be multiple - ways that your data is protected against intrusion. After all, the security and accessibility of your data helps keep them in business.
2. Stability: Because it is a newer business model, and filled with newer, and smaller, vendors, there are questions about stability – will this model last, will it fizzle? Who wants to adopt a technology that will be gone soon after the changes have been implemented? While SaaS is still is in an early and high-growth phase, this doesn’t mean that it is volatile. Like any industry, SaaS companies want to stay in business. The more organizations that adopt these vendors, the more stable these vendors will be. And the more stable they are, the better service they can provide. However, when entering business with any company, do your investigation – Is this company stable enough to survive the current market downturn? How do they respond to issues, how proactive they are, and when in doubt, have contingency plans just in case. While SaaS is becoming much more stable, it still is your data on the line.
3. Pricing models: While you may hear that SaaS can be better for budgeting and help your bottom line, what does that really mean? In many instances, you, as a SaaS user, will pay on a subscription basis for the services that you are using. One common model is to pay on a monthly basis, but that isn’t the only model out there. You can also pay by transaction, depending on what the service is. This can be better for an organization that doesn’t want to be committed to a multi-year contract and can allow an organization to try something out with less risk. However, vendors may offer significant discounts to clients who do make multi-year commitments, and this can make SaaS a more flexible choice for smaller and fast-growing companies that anticipate growth.
New is exciting, but can be fraught with issues, and SaaS is no exception. As it matures, services and knowledge will become steadier, and that bodes well both for you and SaaS companies. If considering incorporating SaaS into your business model, always do your research before committing. Contacting reputable SaaS companies, such as iCorps, in your area about your business needs and asking questions not only can help put your fears to rest, but increase your productivity and revenue.
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