SaaS: What is it? Can your business have too many?
Firstly, let’s begin with defining what SaaS actually is.
Software as a service (or SaaS) is a way of delivering applications over the Internet—as a service. Instead of installing and maintaining software, you simply access it via the Internet, freeing yourself from complex software and hardware management.
SaaS applications are sometimes called Web-based software, on-demand software, or hosted software. Whatever the name, SaaS applications run on a SaaS provider’s servers. The provider manages access to the application, including security, availability, and performance.
SaaS Examples
SaaS uses the Internet to deliver subscription software services, which are managed by a third-party vendor. Well-known SaaS examples include Dropbox, Google Workspace, and Salesforce. Infrastructure-as-a-service (IaaS) offers access to resources such as servers, storage, memory, and other services.
How does SaaS work?
SaaS works through the cloud delivery model. A software provider will either host the application and related data using its own servers, databases, networking and computing resources, or it may be an ISV that contracts a cloud provider to host the application in the provider’s data center. The application will be accessible to any device with a network connection. SaaS applications are typically accessed via web browsers as a result, companies using SaaS applications are not tasked with the setup and maintenance of the software. Users simply pay a subscription fee to gain access to the software, which is a ready-made solution. Organizations can integrate SaaS applications with other software using application programming interfaces (APIs). For example, a business can write its own software tools and use the SaaS provider’s APIs to integrate those tools with the SaaS offering.
What are the advantages of SaaS?
SaaS removes the need for organizations to install and run applications on their own computers or in their own data centers. This eliminates the expense of hardware acquisition, provisioning and maintenance, as well as software licensing, installation and support. Other benefits of the SaaS model include:
- Flexible payments. Rather than purchasing software to install, or additional hardware to support it, customers subscribe to a SaaS offering. Transitioning costs to a recurring operating expense allows many businesses to exercise better and more predictable budgeting. Users can also terminate SaaS offerings at any time to stop those recurring costs.
- Scalable usage. Cloud services like SaaS offer high Vertical scalability, which gives customers the option to access more or fewer services or features on demand.
- Automatic updates. Rather than purchasing new software, customers can rely on a SaaS provider to automatically perform updates and patch management. This further reduces the burden on in-house IT staff.
- Accessibility and persistence. Since SaaS vendors deliver applications over the internet, users can access them from any internet-enabled device and location.
- Customization. SaaS applications are often customizable and can be integrated with other business applications, especially across applications from a common software provider.
How much SaaS is too much?
Is it possible to have too much SaaS? Every shift in technology comes with a new set of challenges. With the explosive growth of SaaS, along with ease of purchase, organizations lack the technology to discover, manage, and optimize their tech investments. The average number of software as a service (SaaS) applications used by organizations worldwide has increased from 8 in 2015 to 110 in 2021 – it has grown even more in 2022. This growth is largely due to the increasing adoption of SaaS applications for their scalability and cost-effectiveness.
We have not found a ceiling when there may be too much SaaS in an organization, because we find that most tech-forward enterprises have several hundred cloud applications in-use today. The question is not about the quantity of SaaS, it’s more about:
- Does your company need it?
- Can you manage it correctly to receive all the benefits from it?
- Do you have an excess of SaaS that you’re not using but paying for?
It is not really a problem of having too many but making sure each application has a purpose, is being utilized and managed properly to optimize the investment.
So, are you using ENOUGH and the RIGHT softwares for your business?
If you’re struggling to manage your SaaS, make sure to reach out, Colby Tech will be more than happy to assist you!