Amazingly, many companies still don't believe software as a service (SaaS) will deliver the goods. They are captive to a number of myths, much as primitives had myths regarding the origins of the world, or the hereafter (and some folk still do).
1. The first is that it doesn't work. Right. Talk to the 30 million users of Gmail, the world's most popular alternative to Microsoft Outlook. They are all, without exception, running aspects of their business with SaaS - and they will do more in time, as Google Apps becomes more widely accepted. Of course, in SA, bandwidth remains a concern, so people won't be seen rejecting Microsoft Office and switching exclusively to Google Apps in any hurry, but elsewhere in the world it is happening. This is increasingly the case with Google Gears allowing folk to operate offline.
2. SaaS lacks the security and integrity corporate clients require. Depending on the service provider, this may be true, but by and large, SaaS vendors provide an application along with the data privacy, security, backup, long-term integrity, governance and more that corporations require. In fact, governance dictates that corporations discharge their responsibilities in an auditable, accountable manner, so this one should be laid to rest. Indeed, given the above, smaller companies should benefit from the corporate rigour larger companies demand.
3. My company will lose control of its systems. IT may be concerned at this possibility, but it really has no bearing. Always remember: business is in charge, not IT. The fact that IT became so powerful, over time, is a key factor in the lack of alignment with business. IT must always be subservient to business, never the other way around.
4. SaaS applications will cost more than packaged software in the long run. One way to avoid this conundrum is to link cost to usage: only people who actually use the software pay for it, and secondly, to tie it to business growth: make payment contingent on actual business success.
5. The IT department will be under threat - people will lose their jobs. In fact, given the skills shortage, this is highly unlikely. More likely, people will be redeployed into higher value, better earning jobs. This is especially so if they are freed of the burden of managing servers, networks, databases and all the other paraphernalia that go with internal IT systems.
Customers who say SaaS does not offer adequate features have not been paying attention.
Richard Firth is chairman and CEO of MIP.
6. Vanilla is the only option and nothing else will do. This is just not the case. It might be if a company is using Gmail, Zoho or another mass-market cloud application, but today, any cloud vendor worth his salt will customise his application for the company - especially if the vendor does not follow the traditional US and European model of 'one size fits all', and instead opts for the hybridised model that has made SA the global leader in this space.
7. Not enough features. You have got to be kidding. Customers who say SaaS does not offer adequate features have not been paying attention. There are many SaaS applications that not only equal standalone, traditionally licensed applications in terms of functionality, but exceed them due to the ability of the local vendor to adapt their software to individual clients' requirements.
8. Lack of hands-on support. The notion that if it's out there, far away, there's no support, is simply incorrect. This might be true with anonymous, generic services such as Gmail, but it definitely is not when it comes to mission-critical SaaS applications, such as medical aid, employee benefits, treasury, lending and life insurance applications, in which regard SA leads the world. When customers spend many millions over a period of years with a company, it had better have world-class service, or it will be out of business.
9. Lack of bandwidth will prevent users from experiencing the same kind of user experience they do when operating in a client-server environment. This might have been true five years ago, but not today. Instead, bandwidth has largely been resolved. But the best SaaS model for SA does not necessarily imply operating across the Web to a server based thousands of kilometres away. South African companies have eagerly embraced a hybrid SaaS model that eliminates capex, while aligning business with IT and embedding best practice.
SaaS works, and it works brilliantly, for companies of any size. The key is to move away from the insular thinking that often characterises IT discussions and look at the bigger picture.
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