SaaS
What’s good about SaaS? What’s not?
SaaS – Software as a Service – has gotten a lot of press over the past two years. Some commentators are for it; others are against it. Some see it as the long awaited Revenge of Timeshare. Some see it as a way to do an end-run around the IT department. Others see it as a simple way to get applications up and running quickly. Still others don’t like it all – they say it’s akin to putting their crown jewels in someone else’s hands.
Despite all the publicity, the market has not anointed SaaS as the Next Big Thing. The BigCo ERP vendors have launched SaaS initiatives but, in our opinion, their efforts have not lived up to expectations. More generally, if you created a stock price index of SaaS vendors, you would find that their share prices have not done well. True, the whole market has been weird lately but – if SaaS were truly the Next Big Thing – you’d think the market would treat SaaS companies a bit better.
At Lawson, we like to distinguish between the pricing mechanism and the delivery mechanism in SaaS. The pricing mechanism is essentially the same as renting rather than owning. You can move in quickly but you never build up any equity. You just pay month after month after month. We can offer both rental and purchase options for Lawson software and a great majority of our customers opt for outright purchase. We think the reason is obvious – it typically costs less in the long run.
The SaaS delivery mechanism, on the other hand, can provide two compelling benefits: 1) there’s no administration; 2) there’s no infrastructure. If you don’t want to spend a lot of time managing your environment, this can be very appealing. You just adopt the software and then adapt your business to it. If you can get by with a standard solution, the SaaS delivery model can be a winner.
At Lawson, we don’t think one size fits all so we always try to give you choices. Of course, we can offer you a traditional perpetual license with the software installed on your premises and under your control. We also offer two other delivery mechanisms that provide the benefits of SaaS without the downside.
- Managed Services - you buy the license and we maintain the applications for you in your facility on your infrastructure. You get the advantage of no administration without the disadvantage of perpetual payments. You also get all the rights and privileges of ownership, including a tailorable solution. It’s a good solution if you want to control your information but don’t want to manage the software.
- Hosted Solution – from your perspective, this is essentially SaaS, except that you purchase the software rather than renting it. You buy the license and we host it at a remote facility. You get two advantages of SaaS – no administration and no infrastructure – without perpetual payments. As with Managed Services, you still get all the rights and privileges of ownership.
Do we offer full SaaS – no administration, no infrastructure, and perpetual payments? Frankly, we haven’t seen much demand for it in our ERP product line. In this regard, we’re similar to the BigCo vendors.
But we have seen some interest in our Strategic Human Capital Management (SHCM) product line. Our customers often have their human resources spread over many locations in multiple countries. SaaS can be a great solution in such situations. On the other hand, a hosted solution with no administration and no infrastructure may be equally compelling. So we offer both SaaS and Hosted Solutions in our SHCM line. We’ll let you decide which solution better suits your needs. Isn’t that the way it should be?
As its name implies, The Lawson Opinionizer offers opinions. We believe we've got our facts straight but we don't guarantee it. A new Opinionizer appears every Monday. If you have an opinion, send an e-mail to Opinionizer@lawson.com
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