The key driver for SaaS, though, is all about the money. When asked what were the three most important potential benefits of SaaS that drove their investigation or adoption decision, the single most common answer was the need to reduce capital and or operating costs.
This view is not just a post-economic trauma syndrome knee-jerk reaction. This is part of the new normal that economists and pundits are talking about these days. Check out the data in the table below. Notice the differences in their views between January 2008 and August 2009. While the composition of the two panels is slightly different, the take away is clear: If you want to sell SaaS in your organization, its all about the money.
Rather than just focusing on the estimated savings from a SaaS vs. on premise solution, SAPs Rao says its customers are taking a different view on the decision about moving to the new delivery mechanism.
There is more of a focus on adding business value to the end user, he says. Customers ask, What can I do to give me the most value to my users in the short term? How will it position me for the long term? The focus on value is the key driver now and going forward.
That should be the guiding light on SaaS, or any IT investment. Instead of debating SaaS vs. on premise, the optimum value may come from a combination of SaaS and on-premise, especially for large companies.