It's the service part of SaaS that will figure most

Opinion article by Jamal Labed, COO Staff&Line

Software-as-a-service (SaaS) has become a global phenomenon and we predict that there will be a revolution in this space over the next few years. SaaS is transforming the way organisations are utilising software. Instead of having software installed on a desktop, PC or server, software is delivered literally 'as a service' via a Web browser or via application virtualisation. Put simply, if you have access to the Internet you can utilise SaaS software.

More and more of our clients are really starting to understand the benefits of SaaS and are very mature in their buying behaviour and identifying their requirements. Today's resource-strapped IT departments are not only searching for tools to 'do the job' but they are now looking for a wider overarching service. For example one of our global clients, which has a very experienced CIO, has over 150 different types of software applications to manage. Imagine the nightmare of managing all this software, trying to schedule in patches, upgrades and other forms of maintenance? This illustrates the problem that many medium sized and global organisations are grappling with. As a consequence IT professionals are turning to managed services and on demand solutions, where they can outsource the administration of the tool as well as the software and focus on their core IT competencies.

Staff&Line has had a SaaS solution for over 10 years. We work very closely with our clients and we understand that they often struggle to deploy and maintain the vast number of applications in their IT estate and a long time ago we decided to go in this direction. Additionally, our number one goal and main value proposition is focused on making IT easy. Today the challenge for IT departments is not how feature-rich or good the technology is – let's face it you can add more features at the flick of a switch - the real issue is that customers need software vendors to make complex processes easy to implement, deploy and use over time. In the volatile business environment that we all operate in, companies are evolving very quickly and they need to be agile and flexible. This means that the IT solutions they put in place also need to be able to adapt just as rapidly. As a business, we have invested a lot of time in this area – making sure that EasyVista really is an incredibly flexible, adaptable and easy to manage solution; our key objective and business mantra being: 'How can we simplify our client's lives?'

We know that when customers are looking to implement a solution, they can lose weeks and months just trying to install the product because of the complexity of their infrastructure. With SaaS you can start almost right way with perhaps a small amount of integration and professional services. It can be implemented quickly and scales much more rapidly than a traditional solution. This is very important right now with budgets under scrutiny because if there is a lag in deploying the solution, not only do you lose momentum but the whole project could be in danger of being pulled. A good example is Staff&Line customer, Expro, this FTSE 250 company, implemented a SaaS global service desk, using EasyVista.com in just six weeks.

Once you have deployed an on-premise solution you need to make sure that you continuously support it. In our experience, most organisations are not upgrading their solution via the right path. Typically they are two or three versions behind the current version and this can become very complex to maintain for both the software provider and the customer. With Saas, we provide a transparent upgrade, so our clients are always on the latest version of the software. When they do upgrade, they don't lose all the customisation in previous versions, which from a technological standpoint is very difficult to achieve with traditional software.

And finally, our SaaS solution provides a higher quality of service at lower costs. But first I need to qualify this because to compare costs you need to compare the right things. If you just look at licence, maintenance and subscriptions over five years, SaaS will undoubtedly be more expensive during this period. You need to compare the total cost of ownership (TCO) around the whole solution and when you dig into this you will see that there are a lot of hidden costs.

Hidden costs can be as much as 60 to 70 percent of TCO. Hidden costs include all the time spent internally administering maintenance. This is incredibly expensive – indeed, the greatest area of costs in an IT portfolio is generally in providing the necessary infrastructure to "keep the lights on." Plus with traditional software solutions every two or three years you will be requested by the software vendor to reinvest.

With SaaS, you will immediately reduce your maintenance costs to zero, and there will be no upgrade costs. You will therefore see that there is a 50 percent economy in SaaS. A good comparison is the motor industry. It is exactly the same concept to buying or leasing a car and how many people lease cars these days versus owning them? The only difference is that the motor industry is very mature and the software industry has some way to go, but this will change.

SaaS pushes the vendor in a positive way to improve its services, because, you really need to work hard on ease of use, availability and security. Let's face it, if you are not delivering a good service it can be switched off. Our clients are judging us every day and because of this the relationship between us has changed. In the past I think software vendors could have been accused of having a sales policy of 'take the money and run'. SaaS providers need to ensure they are delivering a great service 24/7, day in-and day-out and this has had a knock on positive impact for customers where we sell on-premise software.

There is of course a fear factor associated with not having software-on-site, but anytime you buy a piece of third party code you are to some extent beholden to the software provider and reliant on the support offered. Therefore, as long as the supplier can guarantee reliability of uptime, robustness of support, surely there is little difference from physically purchasing software?

However, because not all organisations have reached this level of maturity or thinking, we still offer both. EasyVista Classic is our on-premise version and EasyVista.com is delivered in SaaS mode. Many lack the confidence for example to have their data offsite. Our strategy therefore is to offer client's choices. Interestingly, while some vendors in the SaaS market can or will only deliver SaaS, our preference is to offer clients what they feel will be most beneficial to their business.

My parting comment is that I firmly believe that SaaS is no different to outsourcing, or bringing in a contractor; the staff may not be employed directly by your business but it is possible for all parties to work in harmony together to deliver real cost savings to the business. SaaS means you don't need to have spare IT resources on hand and the IT person only has to support one installed version of the software. The benefits of SaaS are clear:

• Installation times are drastically reduced because there is no need to install software separately on each machine
• Support is simplified, as the system can be monitored and fixed remotely even before an incident occurred
• There are reduced upfront costs for buyers as payment for software usage is on a pay-per-month basis after use
• Ongoing maintenance costs and the drain on IT resources reduce significantly.

I am convinced that in the next few years more and more companies will move in this direction. Therefore, for those organisations who are thinking about adopting SaaS, the three very important questions they should ask themselves are:

• What technology they want to use?
• What they want the technology to do?
• How long they are looking to use it for?