Using Software as a Service

Some of the reasons SaaS is gaining ground include:

• Improved bandwidth
• Data security
• Reduced IT infrastructure within the firm
• Reduced IT management requirements at the firm
• Access of applications and data from any location via the Web
• Outsourcing to India

Should you be using Software as a Service?

Maybe. When looking for software to fill some need in your firm, consider SaaS solutions. When considering a SaaS solution, though, you may want to consider the following questions as to whether any SaaS solution will be right for your firm.

Do you have the required Internet bandwidth and power in your workstations? Some SaaS solutions require some heavy communication and processing power on the desktop, and sometimes all of that power is demanded just from the browser. Older workstations may not cut it. If your firm does not have sufficient bandwidth and is not willing to expand the budget for more, your experience with SaaS will suffer.

Are you comfortable with data residing outside your firewall? The data in the SaaS application will be stored on servers outside your firm. The data will be sent between your office and the data center across the Web. You can find solutions that have security guarantees and secure communication, but your firm really needs to consider how this will effect compliance, data retention, and other security policies.

Evaluating Software as a Service

Once you have started looking for a software solution and have decided you want to look at SaaS solutions for a particular need, carefully evaluate the solution. Here are a few considerations to keep in mind as you look into SaaS solutions. Many of these are not very different from considerations used to evaluate more traditional solutions.

Customization

Have a list of requirements that any solution should satisfy. Most applications are not going to fulfill all your firm’s requirements out of the box. Many SaaS solutions can be customized to make up for any deficiencies in the existing solution to fit your specific needs. However, that customization will come at some cost.

Find a solution that will allow you to maximize your firm’s unique capabilities and needs. Can your existing IT staff customize the solution? Will they need training to do so? Does the ASP provide development support to outsource the work for you? Are third party companies available to do any customization work? Many popular ASPs have a developer community that can be used as a competitive resource for improvements. These solutions make customizations cheaper by allowing contract developers to compete for your business. Some of them may have already developed similar improvements for other firms or may be willing to cut your firm a deal in the hope that another firm will want a similar customization later.

Scalability and Licensing

When evaluating any product, scalability is important. As your firm grows and as the SaaS system collects data over its lifetime, will it scale? With this in mind, you may want to see which other firms or companies use this software. Ask the ASP for a reference so you can talk with one of its clients for a direct opinion about the SaaS solution. Make sure that the SaaS solution can handle large amounts of data and data complexity.

In addition to performance issues, watch the SaaS licensing and pricing model. Most SaaS solutions are sold on a subscription basis with a regular monthly fee, but may include additional charges depending on the pricing model. Some are sold based upon which applications purchased. Some are sold based on the number of users accessing the system. Some are sold based upon the amount of data transferred and space needed to store your data. In this last case, your firm needs to know how much data it expects to store and make an estimate on how much it will transfer. Ask your IT staff or IT provider to help you make these calculations.

Make sure you know which price bracket you’ll be in now and look ahead. Based upon your firm’s plans, how will your needs change over the next three years? Are you prepared for the increase in costs you will incur? How much does the service charge for overages, in case you need to use more resources than normal in a given month? What additional charges are there if you need to expand? Are there charges for getting access to special services, such as data export or integration?

Import, Export, and Backups

Since the data is not physically stored within your firewall, be sure to know the ASP’s backup and disaster recovery policies. Does the provider have off-site backups? How often are backups made? How long are backups retained? Does the provider have a plan for disaster recovery and power failures? Make sure that these are compatible with your firm’s data retention and disaster recovery policies. You may need to make additional efforts to periodically get a local copy of the data for backup and data retention purposes.

Being able to export the data from their system into some useful form is vital. Your data is your data. You should be able to get it back from the ASP’s system in case you decide to cancel the service in the future or just to make backups. You may also want to consider how the SaaS application can be integrated with other local applications. This may be possible if the ASP has data synchronization features available, but may require some additional customization.

Your firm will probably want the capability to import some data in the SaaS system. Most SaaS systems offer a limited trial to use the software. If your firm is interested in a particular system, try it out and how existing data is imported into the system to get started.

Security

Of course, you will need to consider the ASP’s security as well. What kind of physical security policies are implemented? Who has access to the data center? What kind of security is used to verify the identity and history of new employees? How is this verified on a daily basis?

Also consider the data security. Who can access the data? How is the data protected from unauthorized access? How is the data protected and encrypted during transit from the provider to other locations, such as you firm’s office?

Make sure all of these policies are also compatible with your firm’s security policies.

Bells and Whistles

The benefits of SaaS over traditional client/server solutions generally include reduced IT infrastructure within the firm, reduced IT management requirements, and access to the application data from any location with Internet access. In addition, some SaaS solutions provide integration with Microsoft Outlook, Microsoft Office, or other applications. Some of these solutions may also provide offline access through client software installed on a laptop. This can be helpful for any employee who travels and likes to work from the plane or often works in areas without access to a fast Internet connection.

Software as a Service is another class of tools to be considered when looking for application solutions. SaaS can provide many benefits in addition to more traditional solutions. However, SaaS is not going to be right for every firm. As always, get stakeholders at every level of the firm involved. Be sure to evaluate each of the opportunities and risks involved in the many aspects of these solutions. Make the decision that is best for your firm.