Service-Now.com released a white paper called “A Brief History of SaaS.” It addresses all the obvious advantages of SaaS over traditional software and it includes a very useful list of key questions to ask when evaluating SaaS alternatives.
Can the vendor set up and deliver a proof of concept or trial demo within minutes, not hours, days, or weeks?
Totally agree with his sentiment here. If you can’t see the application immediately, it’s not really a SaaS application. Most applications have free accounts or free trials available without having to contact a sales rep or request a demo.
How customizable is the vendor’s offering, and how specifically are customizations executed? (True SaaS solutions provide easy, user-driven customizations that are preserved through all upgrades. SaaS solutions don’t require third party support for customizations.)
I agree that SaaS applications should be configurable by the user and configurations should not increase costs; however, third parties can sometimes integrate and add on to an application via an API which can have some great results. Fundamentally, a true SaaS application has to stand on it’s own and provide obvious value and hopefully a great deal of flexibility.
What is the upgrade process, and how often are upgrades made available? (True SaaS offerings provide regular, automated, no cost, and non-disruptive upgrades.)
Agree. Some upgrades are obvious while others are behind-the-scenes, performance and monitoring enhancements. Innovative applications are rolling out improvements and upgrades every few weeks or perhaps every few months depending on the complexity of the upgrade.
How is a hosted version of the proposed solution more cost-effective than a traditionally licensed, premise-based version?
Total cost of ownership should be obvious, not tricky. Beware of large, up-front implementation fees or large one time costs. Also look out for added fees for small configurations like adding/managing users, building reports, and other repository settings. In addition, investigate possible incremental costs like storage limits or charges based on number of documents. Make sure you get the full picture.
How is the system administered, and who is responsible?
The user should have control and the ability to make real time changes. That is an advantage for the vendor and the client.
Can the vendor provide access to at least one credible reference user of that vendor’s SaaS solution?
Talking to users is always a good idea for any product.
This white paper is a great source of information and a useful guide in the diligence process when you’re looking for the right solution and vendor.
August 31st, 2009
Author: Bill
Phil Wainewright posted a very interesting interview with the CTO of Ariba about their move to the SaaS model. He conducted the interview in two parts with the second part here. The CTO discusses Ariba’s transition from conventional licensed software to software-as-a-service and the advantages it brings to clients: elimination of additional infrastructure costs, deployment acceleration, and pay-as-you-go subscription pricing. Hopefully the transition to SaaS by a publicly traded company will help accelerate the market penetration by all SaaS applications. The change from the traditional model to a SaaS model is a dramatic shift for any software vendor, but it exemplifies the correct response for the market’s demand for powerful yet affordable applications.
August 25th, 2009
Author: Bill
Recently we’ve been getting a lot of questions about pricing, so I thought that I’d address some common misconceptions. We charge $24/user/month for admins and regular users and $6/user/month for read-only users.
The first question we usually get is “but what’s your implementation fee?” We don’t charge an implementation fee. Then we normally hear about archival data and whether we can help get that into our system. If your data is electronic, we can normally migrate it free of charge. If we can’t, we’ll tell you. The next question is about additional fields, folders, and agreements. I guess there are some applications that charge for adding additional configurations. We don’t. You can add unlimited fields, folders, and agreements at no charge and without upgrading to a new product level at a higher price. Other examples we hear are additional charges based on storage or the number of documents. We looked into that method of pricing but it was too complicated and confused prospective clients. Lastly, support charges can sometimes change the whole value proposition of an application. We don’t charge extra for support. Our challenge is to make the application simple and intuitive so that it requires very little support. We add new features based on customer feedback and requests. That’s why we introduced our tracking feature for documents and folders. We don’t charge anything for the additional features or upgrades. They are part of our product and we’d like to keep adding and refining the product until it is close to perfect for our users. If you are unfamiliar with SaaS, there is no hardware to buy and usually no expensive installations or training required.
Like everyone, I’ve heard the expression “you get what you pay for.” Hopefully sometimes you get more than you pay for. At least that’s what we’re trying to do for our clients. In my opinion, the whole point of SaaS is to deliver powerful applications at an affordable price.
August 5th, 2009
Author: Bill
