General SaaS Growing Faster than ERP SaaS

November 23, 2009
By djohnson

According to Gartner, SaaS revenues are growing, but the growth of SaaS ERP remains flat. ERP Cloud News believes that their is tremendous opportunity for growth in the mid-market. There are obstacles that have impeded the growth of SaaS ERP, but these issues are being addressed by several up and coming vendors. Getting this word out, will ensure the healthy growth of ERP SaaS.

Issue 1: ERP is customized

Word to get out: There are new SaaS offerings which offer several levels of customization. This includes customized dashboards, reports, screens, workflows, account structures, and even some business logic. These customizations can be accomplished by using reporting utilities or configuration tools. What is new, is the fact that ERP vendors allow customization of source code and databases within the context of SaaS offerings. In some cases the customizations may require that customers are put into a separate database or provided a separate environment, but the net result to the customer is the same.

Issue 2: Companies are reluctant to move complex infrastructures to SaaS

Word to get out: Old architectures, originally designed for on-premise deployments tend to be wasteful in terms of bandwidth and rely on the security provided by firewalls and other components of the computing environment. When accessed over the Internet, this could result in performance issues. Newer, web-based architectures minimize network traffic and are designed to enforce security by not trusting data from the web. These newer architectures make it much easier to offer SaaS by eliminating performance and security issues.

Issue 3: Companies are afraid to commit to SaaS due to vendor lock-in

Word to get out: Some vendors now offer flexible deployment models to alleviate lock-in and SaaS commitment issues. Flexible deployments allow customers to switch between SaaS and traditional license offerings. Newer technology separates customizations from core business logic to simplify the process of moving between SaaS and on-premise. This flexibility applies to both data as well as the application.

Summary:

Newer software technology and new business models will accelerate the adoption of SaaS ERP by improving customization, removing vendor lock-in, and improving performance over the web.

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