SUBMITTED BY Jeff Haller

Sure, everyone knows that cloud solutions are better. But believe it or not, there is still a lot of confusion about exactly what “cloud” means. When deciding which type of software to go with for your organization, think of the three delivery methods that P2P automation solutions generally fall into:

RELATED CONTENT

Other resources you might find helpful:

  • On-premises software solutions – Software that is licensed, installed, and maintained by your IT team. On-premises solutions require that you procure and maintain appropriate hardware.
  • Cloud solutions – Traditional software that is licensed and implemented specifically by each client but is hosted in the cloud – either by the software vendor or a third party. Be very specific with your vendor when considering this option. They should include “hosted” in the description of what you are buying – and specify who is doing the hosting in the contract.
  • Software as a Service (SaaS) solutions – True multi-tenant solutions that are built for internet delivery and designed for ease of use and low maintenance; the best providers will include best practices and full user support with ongoing training.

Evaluating the Options

These delivery methods and technologies all differ in terms of Total Cost of Ownership (TCO), ability to meet your specific business needs, implementation success, staffing requirements, business agility, and ongoing support and maintenance considerations. In the following table, we’ve listed the six most important areas to consider when evaluating software, and how each of the methods stack up.

 

 

On-Premises

Cloud

True SaaS
Hardware
  • Client owns the data center and is responsible for all associated costs and management.
  • On-premises software not running in your shop.
  • Data center responsibilities are often handled by separate vendors.
  • No technological obsolescence.
  • Provider responsible for all data center and application performance issues.

Ongoing Enhancements

  • As part of major new releases, upgrades usually come at additional costs.
  • Requires internal IT resources and can break customizations.
  • Same as on-premises but often with multiple vendors.
  • Regular updates released throughout the year, and they are automatically integrated without additional costs.
  • No internal IT resources required.
Total Cost of Ownership
  • Investments include: software licenses; hardware and associated infrastructure costs; IT resources; and annual maintenance fee for customer support and training.
  • Additional fees for upgrades/new releases.
  • Often, this analysis excludes hardware, required infrastructure costs, and ongoing costs that are "shared” within an organization.
  • Same as on-premises, with the exception of hardware.
  • There are some IT and infrastructure charges.
  • Beware of potential differences between the data center and the software provider.
  • Be specific about all ongoing maintenance costs.
  • Avoid time and materials implementation projects.
  • Some vendors charge a one-time set-up fee – be sure it specifies results, not just hours.
  • Look for all-inclusive ongoing fees (either monthly or annually).
  • Training and support are included in the monthly service fee from some vendors.
  • Seek vendors that include best practices.
  • Exclude those that charge for ongoing maintenance.
Multi-Tenancy
  • Not multi-tenant.
  • Client is responsible for all application and customization costs and work.
  • Same as on-premises.
  • Avoid separate hosting and software agreements.
  • All costs are shared across clients using the platform, which saves time and money.
  • Demand references.
User Interface
  • Rigid and highly customized.
  • Rigid; can be customized but typically implemented as “basic” as possible.
  • Web native – built for the Internet.
  • Highly tailorable.
  • Mobile friendly.
Client Services
  • Administration, maintenance, training, IT, and user support are the responsibility of the client.
  • Typically all services are a la carte.
  • Beware of hidden costs.
  • Same as on-premises and often require extra charges for these services.
  • Seek specific assurance of integrated support services beyond “maintenance.”
  • Comprehensive user/technical support and training should be provided by the vendor.
  • Avoid self-service or “on-demand” models.
  • Seek advanced service focused on your success (i.e. change management).

 

We strongly suggest narrowing down to just one of these delivery methods before you begin evaluating individual vendors. This will help keep your research focused and reduce much of the risk of misunderstanding among your team. It will also reduce the time of your review process.

Also, make sure to evaluate the projected financial return of each vendor that makes it through your initial screening. Many companies have already established procedures/forms for calculating TCO. We highly recommend TCO analysis as the most uniform method to compare multiple, complex offerings. There are a lot of hidden costs in the traditional software model – assumptions about things that are already in place, like servers and data center infrastructure, that must be accounted for if you are to do a true comparison and an accurate analysis.

Online TCO tools and calculators can be used to help you understand the various criteria you should consider when building a model that works best for your organization. This might be an area where engaging with a consultant or professional services firm proves beneficial, as their experience working with various technologies and vendors can be helpful to your efforts.

A Word of Caution

SaaS options have become more widely used and accepted by organizations, and there have been a multitude of vendors jumping on the SaaS bandwagon. However, all SaaS solutions are not created equal, and there is currently a proliferation of imitation products that don’t provide the benefits of true SaaS.

DataServ is Different

DataServ is a true SaaS solution. From our inception, our goal was to create AP automation solutions that are:

  1. pragmatic, sustainable, and affordable for real-world P2P automation challenges;
  2. delivered as a service – guaranteeing your success; and
  3. about 80% standard with best practices built in – then tailored to your business.

Our SaaS platform was built from scratch – not bolted together from acquisitions – with input from tens of thousands of users over the past 25 years.

Don’t just evaluate the technology; evaluate the results. Ready to see true SaaS in action? Contact us.

CONTACT US

Subscribe to our Blog