by: Christine Swartzendruber, Chief Technology Officer
The need for SaaS has evolved from the increasing costs of specialized software that have far exceeded the price range of a small to medium size business. Look inside any business today, large or small, and you'll notice that the infrastructure is primarily centered on technology. Servers send data to client workstation machines where employees input new data and manipulate existing data, which in turn is sent back to the server.
Not long ago, companies relied heavily on print copies of data, that moved from one department to another usually via inter-company mail envelopes. If someone in the sales department completed a transaction with a customer, the details of the order were recorded on a form, and sent to the shipping and receiving department to be filled, the shipping and receiving department would add their information to the form or include another form, that would be sent over to the accounting department to be billed. Sometimes forms were lost. Sometimes problems with an order would require the form to be sent back to the appropriate department to be corrected. Sometimes an order would be taken for a particular item, that was no longer in stock, or had to be back-ordered, however the sales representative would not know that until the shipping and receiving department sent it back with a note, indicating that the order could not be filled. This made for an ineffective business process. Customer satisfaction was low due to a basic lack of communication between departments.
When computer technology became available to these business, everything changed. The immediate availability of data from one area of a business to another made it possible for orders to be recorded, processed, and billed within minutes. A sales representative could check the availability of a product in the inventory system, if a product was not available the customer knew instantly and could make a decision about their order. This made for greater customer satisfaction an effective way to do business.
The critical component of this new business model is the software that is used to link each of these processes together. Software can be purchased through a Software Company such as Microsoft, or Intuit and installed on the companies server. Individual machines throughout the company have client versions of the software and using that software gives access to all of the data that is stored on the server. The down side to this is that servers are expensive and run expensive software and must be constantly maintained. Software is frequently upgraded and subsequent versions must be purchased. This can be difficult and become costly especially for small businesses.
A new technology solution has emerged, and is becoming a solution for many organizations. Application Service Providers or “Software as a Service” companies are providing software modules that can be leased over the internet monthly, for a small fee.
The need for SaaS has evolved from the increasing costs of specialized software that have far exceeded the price range of a small to medium size business. As well, the growing complexities of software have lead to huge costs in distributing the software to end-users.
Through SaaS, the complexities and costs of such software can be cut down. In addition, the issues of upgrading have been eliminated from the end-firm by placing the onus on the cloud app to maintain up-to-date service.The software is stored on the vendor’s system and is accessed by users through a web browser using HTML or by special purpose client software provided by the vendor.
Custom client software can also interface to these systems through XML APIs(the interface that a computer system provides in order to allow requests for services to be made of it by other computer programs, and/or to allow data to be exchanged between them.) These APIs can also be used where integration with in-house systems is required.
The advantages to the SaaS approach are:
• Software integration issues are eliminated from the client site.
• Software costs for the application are spread over a number of clients.
• Vendors can build more application experience than the in-house staff.
• Keep key software systems up to date, available, and managed for performance by experts.
• Improve the reliability, availability, scalability and security of internal IT systems. • Access product and technology experts dedicated to available products.
• Reduce internal IT costs to a predictable monthly fee.
• Redeploy IT staff and tools to focus on strategic technology projects that impact the enterprise’s bottom line.