As Software as a Service (SaaS) cloud services continue to grow in popularity, (doubling in 3 – 4 years according to IDC) and subscription/ pay as you go costs associated with SaaS products make an attractive alternative to on-premise implementations, it’s crucial businesses understand how important it is to choose a quality SaaS partner.
The rise of SaaS
SaaS can be a great option for businesses – when it’s done well, the Total Cost of Ownership (TCO) can be considerably lower than maintaining the equivalent application on premise. Points for your business case:
- Removal of provisioning infrastructure and maintaining the software, along with flexible OpEx pricing modules
- Agility in being able to get SaaS products up and running very quickly
- Caution should be applied if the vanilla offering doesn’t meet requirements. Customising the product can add considerable complexity and cost
Falling into the trap
When evaluating SaaS services, businesses spend a lot of time looking at the functional parts of the software and the user experience of the interface, but can fall into the trap of glossing over the integration requirements for the software. It’s less common to choose a SaaS product as a greenfield application, so there’s normally some level of integration with existing business data, security, reporting and other processes required. This is generally where the complexity lies and where the costs, if not accurately forecast, can eat into any potential cost savings in the business case.
To achieve the expected cost savings you need to carefully consider the integration requirements for the service BEFORE you sign on the dotted line. It’s very helpful having Business Analysts and Data Architects in your organisation, but if you don’t, what are the most important aspects to consider?
Key integration considerations
Essentially, there are three main considerations for integrating a SaaS product:
Security may seem obvious, but it is often overlooked, creating major risks and operational overheads. The first question is what security credentials do users log in with and what is the process to manage that access? User access management, especially the decommissioning of users, is crucial if sensitive data is stored within the system. Looking at methods for integration with corporate directory services for single sign-on (or same sign-on) simplify this aspect and reduce the burden on account management, helping with reporting for compliance, fraud, etc.
Most SaaS software isn’t isolated and therefore requires input data from other systems and business processes,consequently producing output data that feeds downstream systems and processes. How is the data going to be loaded into the SaaS product (consider day 1 and ongoing as the approach may be different)? Does the software have an Application Programming Interface (API) or will the provider do bulk uploads? How is data retrieved from the software and ingested into downstream systems? Another consideration is how you can get all your data out of the system if you decide to terminate the contract with the SaaS provider.
How do the security and data models affect the existing processes of the organisation? Will additional processes need to be created or existing processes altered or removed? Does the data output from the new software require translation before beingused in other systems? If so, how is this going to be achieved? Are the interfaces to these downstream systems accessible to the SaaS software or does a proxy or a web service need creating to open up the communication channels?Fully understanding the business processes the new system will interact with should ideally form part of the requirements definition – but due consideration should be made for the potential impact these changes will have on the organisation. It’s also worth considering new processes that may be required to continue to use the ever-evolving SaaS applications, as they tend to release frequently to keep up with market demands. Ensuring the product still works for your organisation can mean committing resources to regular testing. This is a step change for organisations who have traditionally been in control of their software upgrade paths and timelines.
A strong business case
Ensuring you run through the above considerations in detail, the evaluation of your next SaaS product should produce a better and more accurate business case, clearly showing business benefits and how you will realise cost savings. You’ll have considered the additional costs involved with implementing and supporting the product of choice and your business users will be happy because their productivity is not hamstrung by ill thought out or poorly implemented integrations. All resulting in being able to realise those benefits in full.
Are you developing a business case for a new SaaS provider? Let me know how it’s going by commenting below or tweeting me.