One of the hot topics among both IT and Finance Executives is the emergence of Software-as-a-Service (SaaS). The concept is not new, giants like Salesforce.com have successfully offered CRM functionality in the cloud for years. But as more and more applications become available as a software-as-a-service option, organizations are struggling to assess the economic promises of SaaS versus the perceived control and security of keeping those applications behind the firewall.
Unfortunately, there is no clear cut answer to which is the better option. So much depends on what the application is; the nature of the technology it is replacing, i.e., is it fully paid for already?; cost; stability of the provider; and many other factors. It is however worth the exercise to make those evaluations when considering software purchases. In many instances you may find that an SaaS based solution will help you to implement much needed software in your operation, which may pay for itself through resulting cost savings, without having to fight for those valuable capital dollars which are in such short supply these days. On the flip side, buying an SaaS solution to replace technology that is bought and paid for and fundamentally doing the job it was intended to do may not make economic sense and could add an unnecessary level of risk.
SaaS solutions are here to stay and there is a place for them. But the simplistic claims on both side of this debate need to be fully vetted before you decide a direction to go for your solution needs.
