Last week I wrote the first part of the Is SaaS for me post. It talked about two important distinctions of the SaaS model: It changes the power play between the customer and the vendor and assures that the vendors work for the customers every day. This part will cover some more distinctions like simplicity, security and maintenance.
It is so much simpler: another thing that works for SaaS product is their age. The good SaaS vintage (1999-2000) is now eight years old. It means that it offers a perfect balance between maturity and cleanness. You may not believe it but your typical enterprise software is 20-25 years old. They were designed before the Internet, before Google and sometimes before the age of robust local area networks. With slower development cycles (Didn’t it take Microsoft 6 years to release the premature Vista?) and many unneeded features added during the years, they tend to be too much on some areas (good luck finding why the setup screen of your product has 750 settings…) and too little on others (should I ask again how come MS-Outlook never embedded a Plaxo like service and can’t tell me that Jane is in the UK right now before I call her at 3:00AM in the morning??).
You really , but really don’t have to maintain it: here is a typical scenario: you bought a product, paid for it and even paid for support. Two years later comes an upgrade. You run among all the users, make them log off, insert the CD, run the installer, upgrade the data, reboot the server and poof, it just doesn’t perform as it used to. 4 hours (or 14…) later you and the friendly support guy discover that the new version encrypts the data but you run an old version of the database that doesn’t support that encryption. Next time you will surely replicate the server, install a test machine and run some testing before risking your production system (and spend three working days in the process). Choose SaaS and the little dwarfs will do all the testing and then one night upgrade every customer, and you will log in from your browser like nothing ever happened.
Let’s talk security: A few years ago I heard SMB customers saying: “I will never let my customer data out of my business”. Working in an IT security company I now discover how vulnerable SMBs are when it comes to security and how little they invest in an overall security plan. I challenge every SMB to run a vulnerability scan once on their network and get the real picture (shoot me an e-mail, I can arrange one for you…). Three people in IT cannot install networks, fix servers, install Office, configure laptops, setup telephony and at the same time configure firewalls, react to never stopping IDS alerts, scan and fix vulnerabilities and enforce policies. By moving to SaaS you actually create a positive chain reaction: by moving one application to SaaS you achieve an immediate security enhancement by letting the pros protect your data. Now your overworked IT department can spend some quality time on security and better protect your internal assets so you get double the security with the same effort.
Now, I am not saying that every SaaS product is great and every on-premise product is antiquated. I am merely suggesting that you should seriously go through this list (which is not full and exhaustive) and ask yourself if the above is important to you. If the answer was yes, the SaaS model excels in all of the above and now you are down to finding the right product for your business.
Think differently? Think the same? Comment please. This is the lifeblood of the blogger…
PS—I had to add it… talking about how updated the on-premise products are, did you know that Office 2008 for Mac, released on January 15th 2008, still highlights “blog” as a misspelled word???
Gadi Shamia 
Excellent thoughts on SaaS. You hit the nail on the head when you said that “It changes the power play between the customer and the vendor and assures that the vendors work for the customers every day.” My company, SpringCM lives by that creed, not just because we are good people (we are) but because it is a matter of survival and thrival (my made up word of the day).
As for security, it is amazing to me that people have no problem trusting their intimate financial data to their online banker or broker, who are in effect practicing the SaaS model. Yet they blanch at the thought of trusting their company’s data to a SaaS application provider – especially when the appropriate use of SaaS eliminates the all-too-common security breach of the lost or stolen laptop full of critical corporate data.
I hope you won’t mind me commenting on both parts of this excellent post, but you bring up a signal point where SaaS is concerned: You don’t have to upgrade the software yourself. The vendor does it for you.
We release upgrades as often as twice per month. We add new components to our library every few months. The client sees immediate benefit without any effort on their part. Why would anyone want to have to worry with keeping up with upgrades and installs themselves?
Truly, with apps like Google Docs, Zoho, SalesForce (and AppExchange), the need for downloadable software is becoming a thing of the past.