SaaS Economics

Bill Gates' comments at the Dallas and IBM's release of new Content Management Products are further indication of SaaS trend. These industry bellwethers are both indicating a committment to the Software as a Service for small and medium size businesses acknowledging that these services can save money and headaches. (Check out IBM's per user pricing --- roughly US$120 -- and compare to the alternative of obtaining your own Content Management Server (Hardware/Software) + Server Management skills!

Security and SaaS

Security is a major issue with any information system although the degree of concern over security varies with the type of data or information being managed. I came across an article on the cbc website http://www.cbc.ca/nl/story/cal-netcare060320.html that reports on an American Privacy organization raising the question of security regarding the Alberta plan to put all Albertans health care records online. The privacy organization argues that our health care records are safer on paper than online!? This seems a little extreme - but it does raise the question of how secure does data have to be? Any business considering software as a service(SaaS) needs to decide the risk to it's data that outside hosting represents. While it's tempting to believe that keeping your data within your own premises (behind your firewall) is safer, ask yourself whether your own IT infrastructure is more likely to be secure than that of a hosting company whose business depends on security. Large institutions particularily the financial industry have been using SaaS for years and while no system can be 100% secure doing business online is no longer an option but a necessity. ( I still remember the debates about the safety of banking online but now I cannot imagine life without it!) A practical approach should you decide to proceed with an SaaS and you are concerned with security is to ask your hosting provider or SaaS vendor to explain what measures they have taken to ensure security. There are a number of independent assessments of security and operation controls including SAS70 II http://www.sas70.com/about.htm .

Software as a Service: Behind the scenes - Anything but simple!

As described in my previous post, using web services some software companies are able to offer restaurant industry solutions that are simple and powerful. From the business owner point of view, these software offerings promise the ability to focus on running the business and not on managing information technology. This promise is the key behind the relatively new and growing "software as a service (SaaS)" industry. (Some would claim that this is a new name for the age old hosted application model - but as we delve into it the differences emerge - more later). There are a number of well known firms that have been offering SaaS for years (salesforce.com, netsuite, intacct come to mind) and also some not so well known firms that are offering some innovative and potentially business simplifying solutions. In the next few postings I will attempt to share some thoughts on this form of software services as it applies to other industries and to examine whether the "simple and powerful" description can indeed be applied. As with most ideas, the truth is in the application (pun intended).

Behind the scenes the technology surrounding the delivery of these applications are anything but simple (of course this statement can be made for non SaaS applications as well). The technology used behind the scenes for SaaS does have some interesting implications for the ability of businesses using specific SaaS applications to collaborate with other businesses and to perhaps offer new services to their customers, and find new ways to analyze the business that would not ordinarily be possible(or more difficult) outside of SaaS software. In other words SaaS software may offer new revenue possibilities, provide new insights and/or save costs. Worth looking at? I think so.

Web Services in the Restaurant Industry

Internet Services are found in the most unexpected of industries.

At the BC Food. Services Expo 2006 I came across two companies that are providing solutions to the Restaurant Industry. What was unique about these companies was the delivery model. They both delivered ASP solutions : web based systems where most of data is stored not on your (the client) site but on the vendors' site. Both vendors delivered POS terminals that they will configure for each specific client to use in the restaurants or fast food premise. The POS terminals were connected via broadband connections to the vendors servers where the data is stored.

While the POS can and do operate without a connection, the power of these terminals is realized in the management reporting (read business intelligence) and remote access that the web connection and central storage makes possible. Restaurant owners and managers could , for example, obtain up to the minute on premise information from any internet terminal ( say from their living rooms).

One company takes this further and will amalgamate all client's data into summary information that can be used to provide industry wide statistics. A single restaurant owner/manager can for example use these industry statistics to compare her restaurants performance against industry averages.

All this can be accomplished without restaurant owners fussing about with complex computer networks.

Simple and Powerful!