In a time when companies are searching for new ways to save money, a thrifty solution has unexpectedly emerged from the IT department.
Not often equated with frugality, Information Technology (IT) departments are usually very expensive to keep and maintain. They require expensive equipment, software, and a well-trained staff to keep the software up to date.
Companies have traditionally viewed their IT departments as a necessary means to stay competitive and further business functions. However, a new business model is rethinking the relationship between businesses, IT departments, and software vendors. This model reduces the expense of establishing, maintaining, or upgrading important software.
Software as a Service (SAAS) is a service delivery model that allows a company to purchase a subscription for the software it needs from a vendor. In turn, the vendor agrees to host the applications on their own servers and maintain it, including handling all issues at the site. The vendor also agrees to provide regular upgrades as part of the agreement.
This is in stark contrast to the traditional relationship held between business and vendor. It used to be that businesses purchased licenses for every computer that would use the software, in addition to paying for a separate contract to train IT staff to maintain the software and respond to programming defects that might arise. When a software upgrade became available, the business had to either pay for the new program or else risk losing ground in the market.
SAAS reduces the enormous upfront cost to IT development, which means a faster return on investment for the company, as well as a more informed decision making process based on real-time information.
As a hosted, monthly subscription service, SAAS allows a business to avoid the risk of making a huge investment with a single vendor. Instead, a company can make quick transitions to another vendor if something better comes around or the vendor cannot deliver what is needed. In this format, the vendor has to provide a quality product to maintain its relationship with the business. In the meantime, the vendor is responsible for providing security and backing up files, giving the business less to worry about.
SAAS has radically changed the business landscape by introducing a service that reduces risk, while saving time and money. It reduces the upfront cost of acquiring and deploying new software, giving small-sized companies and medium-sized companies a better chance to compete with larger enterprises.
Not often equated with frugality, Information Technology (IT) departments are usually very expensive to keep and maintain. They require expensive equipment, software, and a well-trained staff to keep the software up to date.
Companies have traditionally viewed their IT departments as a necessary means to stay competitive and further business functions. However, a new business model is rethinking the relationship between businesses, IT departments, and software vendors. This model reduces the expense of establishing, maintaining, or upgrading important software.
Software as a Service (SAAS) is a service delivery model that allows a company to purchase a subscription for the software it needs from a vendor. In turn, the vendor agrees to host the applications on their own servers and maintain it, including handling all issues at the site. The vendor also agrees to provide regular upgrades as part of the agreement.
This is in stark contrast to the traditional relationship held between business and vendor. It used to be that businesses purchased licenses for every computer that would use the software, in addition to paying for a separate contract to train IT staff to maintain the software and respond to programming defects that might arise. When a software upgrade became available, the business had to either pay for the new program or else risk losing ground in the market.
SAAS reduces the enormous upfront cost to IT development, which means a faster return on investment for the company, as well as a more informed decision making process based on real-time information.
As a hosted, monthly subscription service, SAAS allows a business to avoid the risk of making a huge investment with a single vendor. Instead, a company can make quick transitions to another vendor if something better comes around or the vendor cannot deliver what is needed. In this format, the vendor has to provide a quality product to maintain its relationship with the business. In the meantime, the vendor is responsible for providing security and backing up files, giving the business less to worry about.
SAAS has radically changed the business landscape by introducing a service that reduces risk, while saving time and money. It reduces the upfront cost of acquiring and deploying new software, giving small-sized companies and medium-sized companies a better chance to compete with larger enterprises.
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