Software as a service (SaaS) is a software application delivery model where a software vendor develops a web-native software application and hosts and operates (either independently or through a third-party) the application for use by its customers over the Internet.
Two factors are driving the movement to SaaS. One is the significant technical improvements over the last decade. Computer hardware costs like CPUs, storage and network bandwidth have dropped significantly. In the last two years, memory prices have fallen by almost 75% and CPU prices have fallen by 50%, while capabilities like processing speed and capacity have increased significantly.
The second factor is that certain software applications are becoming standardized. Due to these improvements, it is now possible to host a software application for thousands of companies with shared hardware and still provide good performance. Likewise, it is practical to accommodate the business process needs of thousands of companies using a single copy of software without having to re-write the software code for each customer.
As more software is being delivered as a service, business users now have greater control over the destiny of their business process improvement efforts. And while many SaaS projects require little from the IT department, IT is increasingly feeling the need to get involved to ensure that integration, security and compliance requirements are met. IT is now taking a more consultative role and acting as a liaison between business and vendor.
Why SaaS is Ideal for ECM?
An enterprise content management (ECM) solution has many components that need to be assembled even for the simplest of projects. Below is list of common ECM related technologies that frequently have to be integrated:
* Email management
* Records management
* Fax management
* Access control
* Electronic signature
* Viewing and mark-up
* Version control
In addition to the above, ECM projects require hardware and software like a database server, web server, application server for integration, writing integration code and a plan to maintain all of this and a plan for regular backup. In addition to the ease of implementation, ECM benefits from the SaaS delivery model because a lot of flexibility can be delivered via configuration instead of customization.
On-premise software gets customized very heavily and typically most of the features are not used. The customization is done by expensive staff that has to write and maintain software code. When any component of the solution is upgraded, the code has to be rewritten, making it very expensive to maintain. By contrast, SaaS configuration works like Lego blocks. Most critical business needs can be accommodated although the system is not "infinitely" customizable.
In the context of ECM, this means having capabilities like configurable search, line-of-business users can decide how much importance should be given to document properties like name, the keywords of the document and the actual content. Configurability of the user interface means that different users can choose which buttons they see. Configurable workflow allows business operation managers to adapt the workflow to their business processes. Configuration is very similar to building your own Google or Yahoo home page by making point-and-click selections instead of writing complex code. Configuration is much easier and more flexible than customizing code.
SaaS-based ECM also provides pre-built configurable applications for common business processes that are document-heavy. Examples of such processes include:
* Accounts payable automation
* Contract management
* Proposal management
* Mortgage processing
* Field support
* Insurance processing
* Engagement management
Benefits of SaaS
Software as a service has inherent advantages that make it attractive for the vast majority of content management applications. These are the benefits of the SaaS model:
1. Democratization of turnkey software: companies of all sizes can now afford the basic applications that were historically only within the reach of very large organizations.
2. Extremely fast deployment: with SaaS you can be up and running in days, not weeks or months like on-premises solutions. And users are quick to adopt SaaS applications, so your time-to-value will be much faster with a SaaS solution. Unlike on-premises software, there is nothing to install and SaaS requires no hardware, no software, no additional network infrastructure and no IT expenses to maintain that infrastructure. All you need is a browser and an Internet connection.
3. Complete solutions: Typically, all needed components of a SaaS solution are pre-integrated. There is no need to pay for additional modules or expensive and time-consuming integration services.
4. Low cost: SaaS is delivered as a pay-as-you-go subscription. Combined with the savings in hardware, administration, and professional services, the total cost of a SaaS implementation is typically less than half of on-premises software.
5. Low risk: SaaS is easy to get out of, by simply choosing not to renew the services agreement at the end of the initial term. Usually, this is a one-year period. Often, SaaS providers (like SpringCM) will give you a free trial period, allowing you to configure your solution and try it before making the purchase commitment.
6. Easy to administer: SaaS solutions are usually administered by someone in the business unit, not by IT staff. And since there is nothing to install, no hardware, and no network management, the administration of a SaaS solution usually consists of simple configuration and user access management.
7. Easy to use: SaaS applications are always built with the mindset of getting users productive as soon as possible. For example, the SpringCM solution has an intuitive Web interface, easy configuration steps and a quick tutorial designed to get users familiar with the system in minutes.
8. Easy to integrate: thanks to robust Web services, SaaS solutions fit nicely into other business applications. Often, the document management and workflow features can be invoked from within the other application, so the users do not have to learn a new system to take advantage of the added capabilities.
9. Easy to buy: SaaS applications are easier to buy. If you were considering a $500K on-premises system, you not only have to sell the project internally and get the budget approved but also write up a detailed RFP with help from IT and think of all the ways you might use the system. Instead, when acquiring a SaaS-based application, you can try it and see if it solves your immediate problems. You can go from thinking about a solution to go-live in as little as a few weeks depending on the complexity of your requirements.
10. Faster innovation: Because SaaS solutions are multi-tenant and easier for the vendor to support and upgrade and because a SaaS vendor can very easily find out if new features will conflict with old ones, SaaS companies typically release newer versions every two to three months.
Limitations of SaaS
Although SaaS works for the vast majority of solution areas, there are a few limitations that you should take into consideration.
1. While SaaS works for common business processes, if the business processes are extremely proprietary and very peculiar to the company, then SaaS may not be the right choice.
2. SaaS can handle large volumes of transactions and data, but if your application requires constant transfer of huge volumes of data (terabytes) over the Internet with an expectation of real-time processing, then SaaS may not be the best option.
3. SaaS may not be the right option for your business if your security requirements are such that only your internal IT department can meet them.
4. Although the SaaS model has been in operation for over a decade with millions of users, there are those who prefer the predominant computing model, which is still on-premises software.
Questions to Ask a Vendor
Not all SaaS providers are equal in their ability to satisfy your needs. Not only are there major differences in solution functionality, but there are also differences in each vendor’s ability to deliver and support the type of solution you need.
Here are a few questions that any qualified SaaS vendor should be able to answer.
1. Are you a true SaaS provider, or simply a "hosted" or "ASP" solution? All genuine SaaS solutions are multi-tenant and this is what brings you many of the benefits of a SaaS solution. A truly multi-tenant SaaS provider can demonstrate that all customers are running the same version of the software using shared hardware.
2. What has been your average outage time over the past 12 months? The answer should be way less than 1%. For example, SpringCM provides availability of 99.7% for its solution.
3. How often is new software released? Because of the flexibility and effectiveness of the SaaS architecture, you should expect new product releases much more frequently than with the typical 12-18 month cycle of on-premises software vendors.
4. Is there lag time between a new release and your applying it? If the answer is yes, this is a sign that you may be dealing with a hosted or ASP provider, not a true SaaS. With SaaS, when a new release is available, everyone has immediate access to the new functionality.
5. How much domain experience do you have as a SaaS provider? This question is very important because, whenever possible, you want to deal with a company that really knows how to deliver SaaS solutions, not one who jumped on the bandwagon to take advantage of the rapid growth in the industry.
6. Did you start as a SaaS company? Many of the so-called SaaS vendors are really on-premises software companies who have re-purposed their software code to fit into an on-demand (hosted) model. Such systems do have advantages, but they also include many of the disadvantages of on-premises solutions.
7. Can I try the software for free? Every SaaS provider worth its salt will give you access to its solution for a trial period. This gives you a feel for how the solution will work for you day-to-day. One important consideration is to make sure that any of the content capture, configuration and workflows will be fully available to you as you transition from a trial to a full account.
8. How much customization is required to make the solution usable? The best answer is "none," since SaaS solutions use the concept of "configuration" instead of customization. As we covered earlier, configuration offers many of the same advantages as customization but does not require the significant time and expense.
9. How does your application scale? Certain applications run fine when there are 10 users or 100 users but cannot accommodate larger user populations. Ask your SaaS provider if their application can scale across thousands of companies, not just thousands of users.
10. How will you keep my content and data safe? There is a natural reluctance to trust the maintenance of valuable content (both documents and data) outside the corporate firewall. Good SaaS companies host in facilities that have sophisticated power backup, earthquake/flood-resistant construction, bio-metric security, SAS 70 Type certification and bulletproof construction. Although your IT department may not be able to afford such a facility, the SaaS vendor can do so because the cost gets spread over hundreds or thousands of customers.