In a recent blog post, David Meerman Scott talked about challenging conventional wisdom. The current conventional wisdom is that Software as a Service (SaaS) is always right and that on-premise applications are always wrong. In today’s challenging economy, many customers are looking at SaaS as the holy grail to help them cut costs. While SaaS has a lot of advantages to lower costs, sometimes it may cost more. If a business has already purchased hardware infrastructure and software licenses, it may make sense to keep what they have rather than switching to SaaS; especially if finance has already banked on depreciation costs. It also depends on the specific application. Even though there are numerous SaaS applications on the market, there isn’t one for everything that does all I want. Just look at your own PC. Could you replace everything you run with a SaaS application?
One big advantage of SaaS is that it gives customers a choice and puts them in charge. My cell phone carrier gives me a choice of subsidizing a great phone with a 2-year commitment or a lesser phone with a pay-as-you-go model. Both make sense depending on my needs. The same is true of on-premise versus SaaS applications. I may need to keep my on-premise ERP system, because it gives me what I need to run my business and no SaaS application can duplicate that. As SaaS evolves more organizations will look at its advantages, such as stability, implementation timelines, speed of change and usability.
The conventional wisdom says that moving to SaaS makes sense and in the long run I believe it does for many organizations. But just because we have something new, doesn’t mean the old is always bad. Even though I use a computer, sometimes I still use a pencil and paper to jot down notes. I use the tool that makes sense at the time.
photo credit Irargerich
