SaaS applications down-side

There is a lot being written about software-as-a-service (SaaS) for business applications. Just recently I learnt the downside of SaaS business software.

A company using Salesforce.com has found that it doesn’t do what they wanted. The only money the company invested in the application was the monthly rental, that’s all. So guess what they can do to Salesforce.com? When the company now selects an on-premise application, they will have to make a serious decision and provide serious commitment because the investment will be more significant.

I’m glad we don’t provide SaaS solutions if that’s how quickly customers can switch.

Update: Dennis Howlett has made some valuable comments following from this blog – what he considers the the wrong question, and pointing out a real problem.

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2 thoughts on “SaaS applications down-side

  1. Pingback: Saas downside: wrong question | AccMan

  2. Hi Simon. In my view, you have just highlighted one of the major strengths of SaaS not a flaw? It sounds like you may be thinking about this from the service provider’s perspective, but as a service provider/consultant you should surely be thinking from a client’s perspective? One of the biggest selling points of SaaS is the fact that it offers the client high business value with much lower risk (not to be confused with Total Cost of Ownership – TCO – the TCO can sometimes be higher with SaaS over an extended period, especially Sales Force). This risk mitigation makes SaaS attractive to clients – not to mention sensible…

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