You hear a lot about Saas, and most companies have already started Saas projects. Is it just the latest IT fashion? What are it’s merits?

Let’s start from the top. Saas: Software As A Service. It is a software delivery model, usually based on a subscription and it is centrally hosted. So software, running externally, serviced by an external team. Sometimes it is also dubbed “software on demand”.

Saas targets:

  1. Lower operational and labor costs. Saas directly impacts a company’s revenue and cost. Save to make money.
  2. Focus on core business. Push anything else to external suppliers.
  3. Tap into other knowledge bases. While focus on core business allows for excelling in core processes, Saas opens up a world of specialized capabilities.
  4. Freeing up internal resources. Everybody can be pointed to do what the company needs to do best. Anything else is
  5. Gaining quick access to specialized knowledge. No need to build extensive knowledge or fight over valuable internal resources. Just source as needed.
  6. Delegation of responsibilities. Some functions are difficult to manage and control. Specialized companies can be better positioned while still realizing the targeted benefits.
  7. Buffer capital. Where the traditional software license model takes a large upfront investment, Saas allows spreading out of cost. This way capital can be better leveraged.
  8. Limit risk. The investment of time and money can easily be calculated. If a project is not successful, the ROI is not proven, or otherwise does not bring the targeted benefits, then cuts can be easily made.

While this list does not pretend to fully complete, it does allow a view on why acceptance of Saas is growing.