January 05, 2011, 10:29 AM — Organisations looking to move towards an SaaS set-up should have a clearly defined business case before going forward according to a new report from Ovum.
The report, Exploiting IT Management as a Service, points out that organisations that want to make the most of SaaS software should be prepared to examine the business case of each application rather than following current fashion.
But, warned the report's author, Ovum analyst Stephen Martin, businesses shouldn't think that the business case should be just about keeping costs down. "It's certainly been the case that much of the attention on SaaS has been about moving from cap ex to op ex and it's certainly attractive to many firms to have a set subscription so they know what their costs are going to be but there's a lot more to it than that. Companies should be taking a longer view - it's not whether software is cheaper over three years but whether it is over four or five years."
In addition, added Martin, there are other factors to consider: whether the data centre is based in the same geographic region, the size and experience of the IT support staff and the quantity and quality of software updates. "For example," he said, "If you take ServiceNow - you'll get new functionality, three times a year and not just little tweaks. With traditional on-premise software, a company might be getting updates every 18 months and they will be a pain to administer."
As the report title suggest, IT management is a good starting point for experimenting with SaaS, said Martin. "It's a low risk option, it's not something that's seen as business critical and thus provides the perfect opportunity for a company to dip its toe into the water."