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Executive Brief: Software as a Service (SaaS)
Software as a Service (SaaS), Cloud Computing, On-Demand software: what do all of these terms mean to businesses and what value do they offer? There are many technical explanations available that explore the paradigm shift from client/server and traditional on premise licensed software applications to these newer technologies, but the real difference can be found in the significant economical value proposition of SaaS. Now through 2010 is going to be an ideal time to implement this technology and start getting the savings and benefits.
In the early days, when Henry Ford was making cars, his assembly plants had to have their own electric power plant. There was no power grid. In this analogy, SaaS is synonymous with the power grid and will ultimately dominate the on-premise software (represented by individually-owned power plants). This new model is impressive and the most famous example is Salesforce.com.
The Software as a service value proposition replaces financial, staffing, and IT (information technology) equipment barriers associated with conventional licensed and client/server solutions. Compared to licensed software solutions where the required implementation, continued staffing, and quicker depreciating equipment generally cost 3 to 6 times the actual software investment, the SaaS model's subscription pricing and hosted delivery provide a superior offering for a very small fraction of the investment. Also, businesses can generally terminate their contracts at any time (thereby avoiding return on investment risk and uncertainty) and the services are often covered by service level agreements that contain financial penalties to the software provider.
When businesses are considering purchasing software to help increase efficiencies and lower operational costs, consider the many benefits that can be achieved through using SaaS.
- Save money
- Save time
- Focus your technology budgets on competitive advantage rather than infrastructure
- Gain immediate access to the latest innovations
Anthony Davis is the Founder and CEO of
2GO Software Solutions Inc.
2GO Software Solutions focuses on growing value and increasing the effectiveness of people, vehicles, and inventory when they are outside the four walls of your business.
