A guide to cloud formations – SaaS
November 29, 2011
The cloud computing market has been driven by the considerable uptake of Software-as-a-Service (SaaS) applications, which have allowed enterprises to develop a new IT model that requires minimal capital investment in infrastructure. However, despite the SaaS market’s relative maturity, there is still a lack of clarity when it comes to defining and distinguishing between SaaS offerings.
“Trying to define SaaS is still controversial,” says Laurent Lachal, an analyst at Ovum. “SaaS is application functionality, delivered through a browser and packaged with data storage. It’s quite simple. However, it is diced and sliced in so many different ways,” he adds…
In essence, SaaS is a business tool that is delivered via the internet, but depending on its level of complexity, it may require more customisation and integration with the business.
SaaS can also be defined by how it supports daily processes, according to Lachal.
For instance, SaaS that simply supports customer relationship management (CRM) processes is a basic and fairly limited form of implementation. But if it supports end-to-end processes – for example, from receiving an order to taking payment for it – then this is often defined as Business Process-as-a-Service (BPaaS) and not SaaS. This is because the software offering crosses both CRM and ERP applications.
Scope for customisation
Lachal also argues that SaaS offerings are less customisable than on-premise solutions, although vendors have become more willing to cater for specific company requirements.
One user of the SaaS model is AngelNews, which provides news services for the investment market. Modwenna Rees-Mogg, CEO and founder of AngelNews, argues that CIOs should opt for standardised options if they want a smooth SaaS integration.
AngelNews uses SAP’s Business ByDesign CRM application to support event management. This has meant the company has not had to hire additional staff to undertake administrative tasks.
“I would advise companies to make their SaaS solution work for them, but to try to be flexible about working to a standard system if possible,” says Rees-Mogg.
“Maybe tweak it a bit, but don’t try to reinvent the wheel just because you think you are different when, actually, you can probably try to fit the standard. If you do try to change the application, it will result in additional costs.
“Why make life difficult for yourself when it’s only your ego that makes you say it has to be done a certain way? Often your system can be adapted to fit with what the vendor offers.”
But integration and customisation are not the only problems. Control of data is another concern for SaaS customers.
David Henderson, CIO at publisher A&N Media, which owns several papers including the Daily Mail and Metro, argues that one of the biggest issues with SaaS is that the control of data is often in the hands of the vendor.
Data dilemma
A&N Media has been rolling out the cloud-based Microsoft 365 productivity suite in an effort to centralise operations. The media company’s separate publications, at a national and local level, previously had disparate IT systems and applications.
“The hardest thing for me was getting my legal team to agree we could store our data elsewhere,” says Henderson. “It was only acceptable because we knew the data was going to be held in Europe, so we knew it was going to be within EU safe harbours.”
Safe harbours is a framework agreed between the EU and certain other countries that enables EU companies to store data in those other countries while still meeting EU data protection requirements.
Henderson says the move to SaaS will save the company 20 per cent on cost over a four-year period when compared with the current disparate IT system. He also says the business case worked because A&N’s legacy system was coming to the end of its life.
“SaaS works for us because we are coming from an overall mission that we need to move from a federated disparate system to a centralised consolidated group. A lot of systems are coming to their end of life,” explains Henderson. “The journey to the cloud has been driven by this, and it is fairly simple to approve a business case that avoids a multimillion-pound capital expenditure.”