By: Jeff Siglin BADM 559 Professor Michael Shaw

SaaS Introduction  What is it?  Technically Speaking: It’s software that’s developed and hosted by the SaaS vendor and which the end user (customer) accesses over the Internet  The vendor creates and runs the program in their own data center.  Typically, the customer accesses it through a web browser, and pays a monthly fee  One-size fits all solution

SaaS Evolution  Evolved from the fall of the Application Service Provider (ASP) structure  ASP’s housed application sets in extravagant data centers  They provided online versions of a variety of formerly licensed and packaged software  Customers housed experts for their applications  In trying to serve unique needs of each customer, ASP’s lost economies of scale

Choosing SaaS  SaaS is not right for every company  Not suitable for innovative or critical systems  Poor choice for critical/core practices  Stand alone, Standardized Processes  Not highly dependent/integrated with other systems  Save resources for more important uses

Successful SaaS Vendors  Salesforce.com ▫ Clients include: Cisco and Expedia Corporate Travel ▫ Over 51,000 customers ▫ Widely recognized for its CRM software  LeanLogistics - Transportation Solutions  Ketera – Expense/Procurement Mgmt  GoogleDocs – Office Suite  Zoho – Office Suite

Advantages  Lower initial investment  No on-premise installations  No need to hire multiple programmers, technicians, etc.  No need for additional hardware or infrastructure  Faster implementation  Average of 3 to 6 months  Faster achievement of Return on Investment  Low risk strategy  Can replace a poorly-performing vendor with little or no liability

Disadvantages  Cannot be customized  Competitive Advantage must come from other means  Solely cost reduction/efficiency improvement objective  Requires customer to relinquish control to the SaaS vendor  Vendor will manage/secure data  Constant payment stream  May eventually cost more than traditional systems

Future of SaaS  Bright Future  Popularity growing as larger developers enter the market  Microsoft, Oracle, SAP  Based on Customer Focus  Secure databases, 24/7 access

iBuy  University of Illinois Procurement Systems  Advantages: automated process, wide- spread use of pre-determined contract prices, user profiles  Disadvantages: lack of customization, poor technical support group  Overall: GOOD DECISION

The End SaaS: Software as a Service