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Nov 12, 2019

What does SaaS mean? 10 important things about Software-as-a-Service

Whereas the world of technology is greatly concentrated on software-as-a-service (SaaS), or rather the “Cloud” trend, a large quantity of companies are not yet familiar with the technology. However, all that is changing, because SaaS solutions keep on offering potent software alternatives for several businesses to the conventional on-premise set up.

On a daily basis, we get similar questions about the meaning of SaaS and precisely, how SaaS is different from other conventional models of software.

Therefore, we just thought that it would come in handy to quickly create a guide on the 10 most important things to know about SaaS.

1). The meaning and purpose of SaaS

SaaS is a technique of delivering software in which users are permitted to gain access to specific data with the use of any device with a network connection as well as an internet browser. SaaS is a web-based technique of delivering software, in which the software provider hosts or manages the servers as well as maintain them, including the databases as well as the code that forms an application. However, this has a major difference from the typical on-premise model of delivering software solutions. In the first scenario, companies need not invest in large hardware before they can host a software, consequently this gives buyers the opportunity to outsource the majority of their IT responsibilities which are needed to troubleshoot as well as to ensure the proper maintenance of the software. The package does all this by itself.

Furthermore, enabling remote access through the internet to the data and software applications, SaaS cloud also is dissimilar to the on-premise software that has a conventional model pricing. The on-premise software model pricing usually involves purchasing by using a long-lasting license, which implies that people who purchase the software has a license to it.

Also, they tend to pay about 15% to 20% annually in maintenance as well as support fees. Contrariwise, SaaS makes it easy for buyers to pay the subscription fee on a monthly or annual basis that usually includes the license of the software, support plus several other fees. One of the most significant benefits of SaaS is the ability for it to effectively spread out the costs after some time.

2). Choosing between on-premise and SaaS

The initial stage to a preferable solution to this query is to determine the expansiveness of your business. A SaaS solution is usually recommended for small-scale as well as medium-sized businesses with relatively straight-forward business procedures. This is especially true for businesses that are trying to minimize upfront expenses. Why is this so? The solutions offered by SaaS are typically cost-effective, but it is still somewhat trying to increase its versatility in withstanding the complicated demands of big businesses.

An aspect of its serviceability in which SaaS for business is trying to catch up on when it comes to its services is its ability to deliver a similar quality of great functionality. There is still some disparity between SaaS technology and the on-premise systems, although this is quickly changing with 5G technology. For instance, a relatively average-sized manufacturer which produces highly designed and custom parts for a company like Aerospace may best be suited to use an on-premise system, just because the on-premise package has grown on everyone and comes with an abundance of functions. Contrariwise, a manufacturer that specializes in producing bolts and nuts will discover all the functions they may want in SaaS Solutions. Examples of these manufacturing companies are Plex Systems or the Net Suite Systems.

Therefore, it does boil down to fully grasping the requirements of your company and the best solution to address the requirements both now as well as in the future.

3). The Story of SaaS B2B

The beginning of the collaborative resource environment like cloud computing has been in existence since the 1960s. In a speech in 1961 to some students at MIT, John McCarthy, a popular computer scientist which was awarded the Turing Award due to his piece about Artificial Intelligence, once said, “Computation has the capability to becoming a publicly organized utility someday.” That is, with the cloud computing concept, this has been made possible – a shared source of computing excellence. Whereas the idea has always existed, the internet-based technology which is needed to support the SaaS platform had developed around the later parts of the 1990s. That was around the time that companies such as Salesforce started making available traditional solutions for enterprises like Customer Relationship Management software by the SaaS cloud.

Initially, the world of enterprise software had taken the SaaS industry with a pinch of salt. But, in recent past years, things have changed drastically as SaaS solution companies have been able to show that they can increase their revenue plus customer base by using the subscription licensing technique. Simultaneously, buyers become attracted to the fact that it is affordable and people are already used to the closeness in resemblance of the internet browser-looking user interface (UI) which the SaaS solutions provide.

4)  Customizing the SaaS Software

The time that SaaS ideas first came on the scene, the option to customize was pretty limited. People were offered similar generic solutions and were able to adapt the processes of their business to the software which they had received. Currently, customizing your SaaS business solution has been increasingly easier and common. And also, there are currently numerous consultants which specialize in the business of fine-tuning your SaaS application so as to become suitable for the processes of your business services.

Buyers have the capability to fine-tune the entire attributes of the UI to alter the program’s feel and look, and modify most areas, including data fields, to changing which data is seen. Some business process functions can also be turned on and off at will. But, the power to fully modify the SaaS software is still not quite as flexible in comparison to the on-premise solutions. However, a custom build solution can alleviate any issues.

As the commercial market for SaaS develops, software providers are increasing their investments in the technique of development so as to offer more flexibility as well as customization, which companies are used to having with the on-premise software.

Sure, this all vary with the vendor type and use, but some solutions are more sophisticated than others.

5). Getting to own your data

Most people who sign up for the cloud SaaS services tend to think that the vendors of SaaS are in charge of their data. This is surely something that you should consider during the negotiation of the service level agreement (SLA) with any chosen SaaS vendor. Apart from setting the reliability standards for systems, the SLA features terms and conditions regarding issues, like data ownership, security information as well as schedules for maintenance. It is a vital and fairly large document that cannot be adequately covered here.

Considering ownership, purchasers should make sure that there is a clause contained in the SLA that explicitly states the ownership of their own data. Most contracts for SaaS have inbuilt plus prepaid fallback plans which will offer you access to your data whenever the vendors are no longer in business and also ensures that all data are owned by you.

Additionally, the majority of SaaS vendors typically allow you to export back your data and locally backup the data at any convenient time. It is not a typical thing for any SaaS vendor to state that they want to keep ownership of the client’s data. If you find this in the contract, do not sign it.

6). The Safety of your data

This is among the biggest concerns for most companies that are looking to implement SaaS for business throughout their business departments. The issue of security is a vital consideration when granting some access to your data that is critical to the existence of your business, particularly for companies that tend to have large sets of data. But, with the advancement of internet banking and payroll systems online becoming the typical thing to do, these days, the issue with security seems to be slightly scarce. There are very few things that are more important compared to the bank accounts we own, still the majority of us feel comfortable placing this data within the cloud.

In fact, whether the server is in a different location or right across from you, the security of data is completely independent. Because SaaS providers do not have overwhelming upfront costs, they can and have been investing increasingly in security, data backup, and maintenance compared to small or medium-sized enterprise companies. Due to this reason, a web-based system usually offers an increased level of security than the on-premise system. Additionally, many vendors offering services in SaaS typically go through stringent security processes of the SAS70 Type II auditing which tests the security level of the data center. And it is most probable that the IT department of a company may not be able to afford such a high grade of premium security quality.

7). Addressing your fears about a SaaS provider going out of business

This is an ideal source of worry when it comes to the ecosystem of cloud-based services; several service providers appear and then disappear after some time – either through the consolidation of the industry or through their business going under. However, you still have the data to keep.

Generally, SaaS vendors pay in advance the company which hosts the data to ensure that clients are able to gain access to their data, despite the fact that they may not be in existence anymore.

Then again, the most vital thing here is to ensure that there is a clause in your SLA which clearly states that, it is possible for you to transfer data held by your provider. However, the majority of the SLAs in existence do have this as a standard practice.

Also, the clause should include the type of format and the frequency in which you can access your data. It is a common thing for SLAs to stipulate also that the SaaS provider will assist in migrating the data, for a proper fee.

8). Knowing about the limitations of the Operating System (OS) /Internet of the SaaS

One of the main concerns of SaaS is that it needs a proper internet connection to fully function. You will often be in the proper position to know this better than anyone. How is your internet network? While a lot of people tend to think that the on-premise systems are more reliable, none of the available systems are safe from having downtimes. On-premise solutions are typically prone to power outages, possible hardware failures as well as several other risks. As protection, some vendors of SaaS have come up with the “offline” capability which allows users to continue working in the case that the internet experiences an outage. As soon as a solid internet connection is restored once more, the entire piece of data is promptly synced back to the system.

Apart from the network connection, most people are more concerned about the compatibility of their operating systems. The majority of enterprise systems are built to operate on either Linux or the Windows OS. However, this is beginning to change. For Mac users, they should be happy to see an increasing number of enterprise vendors develop supporting solutions for the Mac OS. As the adoption of the Mac spreads around enterprises, users ought to expect the acceleration of the fully functional Mac support. Moreover, major SaaS companies work pretty well with numerous internet browsers. So, irrespective of the system being used, your SaaS applications remain accessible by you.

9). Know the disparity between cloud computing and SaaS

It is not just a play on words, the cloud is used to describe a collection of awesome arrays of infrastructure technology. At a basic level, it is a set of computers, databases, and servers which are linked together in the way that users can lease out access to split up the combined power. The power of the computing involved is scalable so that clients can relatively decrease or increase the quantity of power of computing units they purchase.

The cloud is used to refer to everything that is being hosted from a distance and subsequently delivered over the internet. While all known cloud programs are being driven by background software, SaaS typically refers particularly to business software solutions which are delivered through the cloud. Due to the increased growth in the accessibility of cloud services, it has been faster, easier as well as more affordable for SaaS providers to launch out all applications when compared to conventional on-premise software methods of development. Nowadays, about every category of the main business functions – from enterprise resource management to human resources – is offered through SaaS.

10). Knowing the meaning of the Private Cloud

The private cloud uses the entire infrastructure technology which runs on the public cloud and subsequently stores it on-premise. Clients get a similar functionality as well as the ability to gain access to their data via an internet browser. But rather than splitting up the computing wattage with members of the public, this computer wattage power is split among the users based in one company. Contrariwise, to the public cloud method, the private cloud needs a dedicated IT department to carry out maintenance duties as well as upkeep.

The private cloud is actually a viable alternative for large companies that are capable of investing directly in the level of infrastructure that is needed to produce and maintain the cloud system.

With the private cloud, it can take a long time and large-scale usage to create a return on money expended from this type of technology investment. However, for relatively large companies that prefer a discreet service and are wary of their information in a publicly accessible cloud, it is quite an attractive alternative.

While these ten points do not represent a comprehensive overview of everything about SaaS, they are the most important tips which potential clients or buyers should be aware of.

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