Software as a Service Poised for Continued Growth

SaaS helps businesses run faster than their competitors

A new study from IBM finds that adopters of software as a service (SaaS) are using it to gain competitive advantage, not simply save money. Combined with company culture urging collaboration, SaaS can be a powerful business tool.

Software as a Service (SaaS) continues to be a compelling technology for enterprise users and authors of a new study from IBM expect it to grow as more organizations find that it gives them a competitive advantage.

The market for Software as a Service was roughly $18.2 billion in 2012, and adoption is anticipated to peg $45.6 billion by 2017.

The Business Case for SaaS

Andrey Akselrod, the co-founder and chief technology officer of Smartling, a translation technology company with a Software as a Service offering, notes on ProgrammableWeb that there’s no compelling reason for companies to not be moving to SaaS:

The benefits of SaaS simply outweigh any other model. Companies pay only for what they use, and there’s no complex hardware requiring IT expertise to install and maintain—only easy-to-use, Web-based interfaces.…The bottom line: SaaS minimizes upfront costs and enables companies to go live quicker, keeping their attention focused on core competencies.

That ability to focus on the company’s core business is a more compelling business case for SaaS adopters than simple cost savings.

The IBM study found some SaaS adopters among the roughly 880 businesses decision-makers polled have gained significant competitive advantage from adopting the technology. These “Pacesetter” organizations, which represent about 17 percent of SaaS users, are using SaaS to improve their agility.

Using the Cloud Strategically

Rather than using SaaS primarily as a means to reduce their total cost of ownership, these companies are using it strategically. They want to expand collaboration throughout their organization and improve the customer experience. In fact, within these companies, line of business and IT departments cooperate and collaborate, giving them an advantage from improved internal and external communications.

Such strong partnerships, according to IBM, also helps these businesses leverage SaaS for better decision making and allows them to have improved market agility. These “Pacesetter” businesses are, for example, using SaaS with analytics to help them make the right decisions at the right time. They are also using it to identify potential job candidates, for optimizing processes and workflows, and to discover resources for projects. The study notes:

By every measure, SaaS is enabling its top practitioners to respond more effectively to fast-breaking challenges and opportunities and, in the process, find whole new routes to market success.

Business Rules Management and SaaS: a Powerful Combo

One tactic some companies are taking is using Business Rule Management System (BRMS) tools alongside SaaS, allowing them to make more responsive decisions and increase their agility. The ability to quickly create and deploy business rules can help line of business units work even more easily with IT departments. These types of systems enable analysts to devise rules without relying on the coding expertise of an IT professional. The IT department is thus free to undertake projects designed to drive the business’s responsiveness and agility even further. Such automation can help improve various decision processes.

The Progress® Corticon® BRMS integrates with the Progress® Rollbase® rapid application development tool for cloud-based software development. If you’d like more information, please contact us.