WHAT IS SOFTWARE AS A SERVICE (SaaS)?

Software as a Service (SaaS) is essentially a model of software delivery. The software company provides the maintenance, daily technical operation and support for software provided to the client. SaaS delivery is assumed to be over the internet, being able to be delivered to any market segment including home consumers, small business, medium and large business.

Key characteristics of SaaS include:

• Network-based access and management of commercially available software.
• Activities managed from central locations rather than at each customer’s site, enabling clients’ access of applications remotely via the internet.
• Delivery of application that is closer to a one-to-many model than a one-to-one model, including architecture, pricing, partnering and management characteristics.

HRsmart offers some of its lite applications, to smaller companies, as a service termed on-demand software. An On Demand Software Solution is where a company (vendor) offers to customers software specifically built for one-to-many hosting, meaning that one copy of the software is installed for use by many companies that access the software across the internet, thus resulting in huge costs benefits to customers.

There are certain drivers for the adoption of SaaS, these include:

• The fact that everyone has a computer and most information workers are familiar with conventions of mouse usage and web interfaces.
• Computing itself is a commodity, with the business processes and the data itself – customer records, workflows and pricing information – that matters most. Computing and application licenses are expensive and are therefore suitable for cost reduction and outsourcing. Such adoption of SaaS could also drive internet-scale to become a commodity.
• Applications are standardized, with most people using standardized applications, allowing users to switch from one system to another easily.
• Parametric applications are usable, with recent applications particularly web-based ones, allowing applications to be created from parameters and macros. This allows any organization to create many different business logic types atop a common application platform.
• Specialized software providers can target a global market. A hosted application can instantly reach the entire market, making specialization within a vertical preferable. SaaS providers can thus deliver products that meet their market’s needs more closely than traditional vendors.
• The internet based systems are reliable.
• Security is well trusted and transparent.

Benefits of SaaS

SaaS offers many opportunities for organizations of all sizes to shift the risks of software acquisition, and to move IT from a reactive cost center to being a proactive, value-producing part of the enterprise.

Deploying large-scale business-critical software systems, such as ERP and CRM application suites, has been a major undertaking with a high cost. SaaS applications don't require the deployment of a large infrastructure at the client's location, eliminating or drastically reducing the upfront commitment of resources. The fact that there are is no significant initial investment to amortize, an enterprise deploying a SaaS application that turns out to produce disappointing results, can walk away and pursue a different direction, without having to abandon an expensive on-premise infrastructure. SaaS applications can also be planned and executed with minimal effort and roll-out activities, creating one of the shortest time-to-value intervals possible for a major IT investment.

The job of deploying an application and keeping it running from day to day—testing and installing patches, managing upgrades, monitoring performance, ensuring high availability, and so forth—is handled by the provider if a SaaS application is chosen by the company. The transfer of responsibility for these "overhead" activities to a third party allows the IT department to focus more on high-value activities that align with and support the business goals of the enterprise.

With the adoption of a SaaS application, instead of being primarily reactive and operations-focused, the chief information officer (CIO) and IT staff can effectively function as technology strategists to the rest of the company, working with business units to understand their business needs and advise them on how best to use technology to accomplish their objectives. IT departments have an opportunity to contribute to the success of the enterprise more directly than ever before, with the adoption of SaaS applications.

1. http://msdn2.microsoft.com/en-us/library/aa905332.aspx#enterprisertw_topic3
2. http://en.wikipedia.org/wiki/Software_as_a_service