Cloud SaaS

Software as a Service – Implementation process

SaaSImplementation

This section provides an example of the procurement process and implementation of a SaaS product. One of the factors that provides better total cost of ownership for SaaS solutions compared to traditional installed solutions is the cost and time of implementation. SaaS solutions are characterised by their ease of implementation and quicker time to market or to value with deployments generally available instantly compared to a month or more with traditional software.

Customers don’t have to spend time and money installing or maintaining additional servers, networking equipment, security products, or other hardware. SaaS providers generally offer a free trial period but, in any case, the ‘pay-as-you-go’ pricing lends itself to a small pilot with a few users that can start almost immediately to prove the system. Once proven, the focus of the rollout is on end-user training and acceptance. Depending on the complexity of the applications involved, the implementation consultancy for a SaaS solution can be a fraction of that needed for traditional software.

Evaluation

An advantage of many SaaS products is that a free of charge evaluation period is available. This allows you to test the software using a small volume of data. For small business, this allows a solution to be tested on an almost instant basis. For larger business, an evaluation will only be meaningful if planned and, where necessary, configured for the customer’s business. The ability to scale up and down is assumed with SaaS services but, if in doubt, be sure to ask for reference customers.

Contract consideration

Most SaaS services offer a standard contract or Terms and Conditions – the ‘click to accept’ model. However, some businesses, especially larger ones, will insist on changes to these fixed terms in order to protect their financial and security interests. See Data security and risk.

Configuration

It may be possible to configure the SaaS application to suit a particular organisation’s needs. In general terms such customisation will be limited but it should be explored to ensure the best fit for the customer.

User access

As in any multi-user system, access rights need to be considered, set up and administered.

Data loading

Depending on the particular service, a significant volume of data may need to be loaded. The SaaS vendor usually provides data input or migration tools to help with this, or other third parties may specialise in providing data conversion services.

Testing or user acceptance testing

Testing may be carried out as part of the evaluation process or, if the risk is low, once the customer has subscribed to the service. The testing ensures that the organisation specific configuration is correct and that the service is working as a harmonious part of internal business processes. For many SMEs the testing phase may well be a simple 2-3 month pilot of using the software in parallel with existing systems. User acceptance is crucial for large organisations using mission-critical applications. SaaS vendors often build a database of test data that all of their customers can use and, if they wish, add to.

Training

An often underestimated aspect of any system implementation is training. A good SaaS vendor will provide adequate training; the key difference is that most SaaS products are intuitive and training can generally be provided as the user unlocks the different parts of the application. Fitting with their need for a scalable business, most SaaS vendors will offer a mix of self-service tools, online help and training that can be done at the user’s desk.

Support

It is important to review the support elements of the service. SaaS vendors will generally provide total support to the user. The IT department, if there is one, should therefore have less day-to-day involvement. Remember that SaaS is a ‘service’ and not just another method of technology provision. Having said that, customers need to be clear about what support is on offer and whether they need to incorporate further support within the organisation.

Pathway to ‘Go Live’

A SaaS product, depending on its particular service, can be implemented in many ways. The table below provides a generic comparison of the SaaS selection and implementation process with that of traditional software. Customers’ specific requirements may vary but this should provide a useful guide.

 

SaaS

On Premise Implementation

Business Assurance

Global vendors ensure the product meets local compliance and regulatory rules regarding data protection and privacy.

 

Costs

Based on Operating Cost: Subscription fee usually based on system usage or number of users. Other costs are data preparation, site configuration, business change and training.

Based on Capital Cost: Requires a large upfront investment in software licences and hardware to support the application. Other costs include internal IT, data preparation, configuration, application modification, business change and training.

Data

Quality/quantity of data is controlled within the SaaS application. The data is still owned by the customer although the data will be outside the organisations physical boundaries.

The business and IT are responsible for data ownership, cleaning, loading, and governance.

Evaluation

The evaluation is performed by configuring and using the application to test how the services can be integrated with the IT involvement is only normally IT involvement is only normally needed to ensure users can access the SaaS website or if integration with other systems is required.

The evaluation process is mainly a paper-based comparison of stated requirements and available features to establish the percentage fit. Extensive checking of each package is made followed by demonstrations by each potential supplier. IT is heavily involved to evaluate requirements for servers, network and PCs.

Implementation

The software is already installed and running but will usually require user security and company specific data fields. Minimal requirement for Minimal requirement for IT resources unless integration with other software is required.

Implementation is a large part of the total project often involving the installation of new servers and PCs as well as both server-based and PC-based software. Software modifications may also need to be developed and tested.

Integration

Most SaaS suppliers provide Standard ‘web service’ interfaces to allow integration with other software.

Some packages have standard ‘web service’ interfaces but many have limited interfaces for integration or require bespoke code to be written.

Maintenance and updates

The service is updated frequently (usually monthly) so the organisation is always using the last version.

New releases are less frequent (often 12 months apart) and must be installed by IT.

 

SaaS

On Premise Implementation

Performance

Performance levels are agreed within the terms of a service level agreement.

Internal IT as well as the internal IT as well as the performance of the application supplier.

Requirements specification

Usually a high level list of minimum requirements is made with the knowledge that the SaaS provides standard offering cannot be changed.

At the lower end of the market the situation with standard packages is similar to SaaS. But for larger projects, a detailed requirements specification is produced to determine whether a standard package can meet the needs or whether a ‘bespoke’ solution is needed.

Risk

As an organisation can test and pilot use of the software during a free trial period or by committing only to a short term subscription risk is very low.

Risk is high as most of the costs and most of the effort are expended upfront before the users are able to acceptance test the system.

Support

Predominantly provided by the service provider with little, if any, support needed from IT.

Usually support is handled in two levels:

1. IT to determine if it is an IT or functional issue.

2. The application provider.

Training

As the software is designed for ease of use to fit a ‘sign up and go’ model, training needs are significantly reduced. Most vendors will offer online training that can be done at the user’s desk.

Training is generally carried out in a classroom setting. Training is also required for IT so it can install and support the product.

User testing and pilot running

The project is primarily to ensure that the organisation can adopt the software within its business processes.

The testing phase is generally much longer than with SaaS as the users have not had ‘hands on’ experience of the software during evaluation. Both functional and business process testing is required

Next article Cost differentiations A return on Investment (ROI) comparison will probably work out to be similar. However pay back over a 3 – 5 year calculation requires your business needs to remain static. For many organisations over such a time period their IT requirements change. Consequently your ROI calculation becomes invalid. A SaaS solution can evolve users can be added or reduced as required…

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