Software as a Service (SaaS) is a fast-growing service model in which a cloud-hosted software platform is accessed through a monthly subscription to a vendor (which normally includes technical support and updates), rather than through purchasing a licence per user.
From a legal perspective, you never ‘own’ the license to SaaS software, which remains with the vendor, but there are many advantages to choosing this option over on-premises software, especially for large scale ERP software such as SAP Business One.
Before you invest in any traditional software platform, you must ensure you have sufficiently powerful hardware to operate it. This can cause a problem for older computers and servers and frequently involves investing in new IT hardware before new software can be implemented. One of the biggest advantages of the SaaS business model is the way in which it allows companies to simplify their IT infrastructure. As the software platform is installed remotely on the vendor’s servers and only accessed through your machines via the cloud, you no longer require high speed computers to take advantage of advanced software. Furthermore, SaaS allows you to access software on your terms, including while working remotely, on any device with an Internet connection. This enables employees to access complex, full-function software on mobile devices and tablets, as well as their work computer.
As a manager or business person, you know that stable revenue is crucial to business growth. The SaaS model is ideally positioned to help you reach consistent revenue targets, since SaaS operates on a membership basis. Instead of purchasing an expensive user-licence as a lump sum, typically, SaaS solutions are offered as monthly or yearly subscriptions, which simplifies your IT expenditure and makes it easier to manage your cash flow.
The SaaS business model puts tremendous value on cultivating customer relationships. The very idea of “membership” suggests a sense of belonging to an exclusive and close-knit community, which is clearly different from classic software ownership. The idea is that the SaaS model creates a buyers’ market, in which the onus is on vendors to provide superior customer service in exchange for their subscription fees. Many businesses report superior technical support and more attentive customer service when transitioning to SaaS software from an on-premises solution.
Here’s another area where SaaS shines in comparison to on-premises solutions – especially those that are advertised as “next-generation” products or versions - regular product updates and fixes. With traditional software platforms, these product updates can be notoriously disruptive to business operations, and releasing large patches or bug fixes is time consuming. Furthermore, it’s often your responsibility as a business to download the patch or upgrade, and ensure it is implemented successfully across your software installations.
With SaaS software, upgrades are rolled out automatically and, as the software is not locally installed on your machines, does not cause disruption to your operations.
The SaaS software business model is very customer-centric, and as such, can often provide better guarantees of business continuity and technical support than traditional software purchase options. For more information about how the SaaS model can improve your experience of critical business software, including SAP, please get in touch with one of our customer service team today.