Software-as-a-Service (SaaS), also known as cloud-based Software, has become prominent in recent years. According to Gartner’s 2021 Emerging Technology Product Leader Survey, nearly half of the survey participants investing in data analytics opted for SaaS as one of their highest ranked evolving investments.

It’s understandable. Web-based business applications don’t require lengthy installations or binding contracts, and they’re charged on an hourly basis rather than in one lump sum.

As a result, the solutions are particularly more adaptable and cost-effective for any expenditure.

Many business leaders still have concerns about Software as a Service and would like to know why it might be a better match for their organization.

One relatively new way of understanding why SaaS is suitable for a business is understanding that it allows your company an opportunity to increase the quality of your customer experience.

This article will answer some of the most common questions business owners have about SaaS.

What is Software as a service, and how does it work?

Software as a service (SaaS) is a term that refers to Software that is provided as a service over the cloud. It is a software supply and leasing process in which Software is easily accessed through a subscription rather than purchased and implemented on computer systems.

This strategy involves selling so many benefits to developers and users that two-thirds of businesses utilize SaaS applications more than in 2016. Moreover, nearly half of companies will be using SaaS for almost all of their apps by 2025.

Software-as-a-Service (SaaS) has grown in popularity in tandem with cloud technology. Cloud computing provides technology-based online services, which usually entail storage space, network management, and data centers. Before SaaS, companies that wanted to update their Software had to buy compressed disks with the updates and install them onto their computer systems.

The cloud-based framework is so prevalent that more than two-thirds of software buyers request web-based products. Some industries are even bucking this trend, so the demand for web applications is likely to increase (and their cost will come down).

Here are the two key differences between cloud and on-premise software solutions:

  • Hardware implementation and maintenance: Since SaaS implementations don’t entail a lot of hardware, purchasers can outsource most of the IT work that would otherwise be permitted to debug and maintain the Software in-house. This can be a crucial differentiator for smaller companies trying to cut expenses and streamline their IT resources.

Payment models and fees: On-premise software is mainly procured through a perpetual license, paid beforehand, while SaaS programs are generally charged monthly. Since the owner can regulate their software usage (outside of these monthly limits), this permits more enterprise firms to utilize SaaS tools.

Software as a Service ownership and SLA

In most cases, your data in a cloud-based system is still yours. Thus, many terms and conditions, including SLAs, state that your corporation owns the data just on the provider’s servers and that you have the right to retrieve it. If a breach occurs, you should have access to your company’s data. 

A SaaS contract usually includes built-in and prepaid provisions that ensure you have access to your data if the provider closes down. This is delivered by storing access keys and data in the cloud. 

Besides that, many SaaS providers will actually enable you to outsource and backup your data locally at any time. It’s peculiar for a vendor to insist on owning your data.

Don’t accept the red line if you see this in a clause. Before actually committing to purchasing a new solution, you should review this SLA with your various stakeholder groups. As a result, before signing a contract with a SaaS provider, check the following points:

  • Data Backup, upgrades, and security are mostly the provider’s responsibility.
  • Keeping your SaaS support provider notified and posted is a crucial element in the agreement.
  • Support and maintenance should be the uptime.

Enterprise IT benefits from SaaS.

Software as a service enables users to access Software from anywhere on any approved source without being behind the corporate firewall, as staff members have become more diversified and remote.

Since SaaS facilitates simultaneous use of the same instrument or document, it is possible for more real-time collaboration. Today, workgroups tend to spend vastly more of their time interacting via email than face-to-face.

Software as a service also gives businesses more agility as they expand because they only have to pay for the software employees if usage is appropriately tracked and monitored. SaaS also means increased productivity, a lower acquisition cost, minimal IT security management, and easier scaling.

Since the SaaS provider handles everything, IT teams don’t have to worry about staying up to date with the latest releases or installing patches like security updates. SaaS is the only way businesses can quickly and efficiently continue their transition to mobile.

What are the drawbacks of the SaaS internet and the operating system?

The most significant disadvantage of SaaS is that it is dependent on a stable internet connection. However, unless your organization is located in a remote location, your internet connection will be adequate to use today’s SaaS systems.

While many people believe on-premise systems are more stable, no system is completely fault-free. Electric blackouts, glitches, and other risks can affect on-premise Software. As a result, some SaaS providers now offer “offline” functionality as a safety net, allowing users to continue operating even if the internet is down.

All the data is linked up to the system once a strong connection is reestablished. Some purchasers are concerned about compatibility with devices other than the internet connection.

What happens if my supplier closes down?

The number of software providers in the market is not fixed as there are many reasons for a provider to go out of business. Regardless of the reason, one must know what will happen to its data and resources once a business is closed. Most SaaS companies pay their data center hosting provider in advance to “keep the power on.”

This prepaid fee is designed to protect businesses by ensuring that their data can be accessed if the SaaS vendor fails.

The key here is to ensure that your SLA includes a clause that expressly states that you can export your data from your account. This is especially important to ensure data safety and ease disaster relief efforts.