Software as a service or SaaS as it is more commonly known is simply a method by which software applications are hosted from a centralized location online (in what is referred to as the ‘cloud’) and delivered across the internet – as a service.

It replaces the need for legacy software that must be installed, run, updated, and maintained from a local machine that you control and have physical access to. Everything is accessed via the internet through a server that is maintained elsewhere by the SaaS provider. The SaaS provider generally gives you an online client application to gain access to the software but many companies offer their services strictly from an internet browser, thereby making the whole thing that much lighter.

Since your SaaS provider handles all of the security, performance, and maintenance, you have less upkeep, if any at all, on your end. This frees you from the responsibility and time required to maintain various, sometimes rather complex, hardware and software management.

SaaS has grown to be a valid contender in the tech space, and a behemoth in innovation when it is applied to the supply chain to streamline all roles. As a whole, this technology is slated to exceed $112.8 billion by 2019 according to IDC research. Also according to IDC, SaaS delivery will outpace traditional software delivery and services, growing nearly five times faster than those legacy methods.

By 2019, cloud-based models will account for right around $1 for every $4.59 spent on software.

The future looks bright still for the SaaS model. For those of you who are new to this method of software delivery and are considering it as a viable option for your business, we are going to go over some of the pros and cons of SaaS in this article today.

So without further ado, let’s jump in…

The Benefits To Using A SaaS

Accessibility

One of the biggest benefits of utilizing a SaaS provider is the level of accessibility you are getting. Since everything is done online, you can typically access your dashboard from just about anywhere. As a matter of fact, the majority of SaaS providers also offer some sort of mobile app for all your remote work needs.

Reliability

Managing a server, let alone all of the software that it surely will be running, can be a daunting task even for the most seasoned IT guys. With a decent SaaS provider, however, this is nothing that is going to your concern. That is what you are paying your provider for.

Many of the top SaaS providers can offer you 99.9% uptime. Let me tell you right now that trying to keep your server online and without major issues almost around the clock while also managing an entire warehouse or supply chain is next to impossible. Let the professionals handle all of that stuff as many of them have perfected it like a fine art.

Return On Investment (ROI)

When you purchase any sort of tools, tech, or service, you want to be sure that you can make money back on it, right?

One of the best ways to do this is by doing away with your in-house or on-site solutions and sign up for a decent SaaS package. This will save you so much money in the long-run on things like server racks, cooling systems for the server room (yes, servers get rather hot), upgrades, etc… I can almost assure you that it is going to be more efficient and less costly to simply make use of a SaaS.

A good majority of the SaaS providers out there will have a few various packages available for you to choose from. It really just depends on what features you need but many of the options that come without all the extra bells and whistles are more than affordable even for smaller logistics operations.

Security

The security that you will receive from a team dedicated to the upkeep of services around the clock is more than enough to justify the switch, in my opinion.

Too often these days we hear of security breaches happening at major corporations. They are a very real threat in this day and age and that is why you need the peace of mind that comes with having all of your business's sensitive data processed securely only through a vendor's cloud-based data center only.

The Downsides To Using A SaaS Provider

Downtime and Outages

Many of the SaaS providers out there service many clients all at the same time. Because of this, their data centers have to consume quite a large amount of bandwidth. The problem is that they only have so much at their disposal.

This means that in order for them to cater to even more customers, you may experience outages, downtimes, or severe latency issues when trying to access your own dashboard. As the bandwidth decreases, so do the speed or availability.

Aside from it being an issue on the provider's end, it could also be due to a poor internet connection, or other issues on your end. Keep in mind that if you are utilizing this type of service for your supply chain, it will often be utilized inside warehouses, and in areas where you may not have the best signal.

Before choosing a SaaS provider, research their performance, read what other customers are saying about them, and check out their SLA.

Security

Yes, I know this was also one of the benefits that we discussed previously, but it can also be a major downfall in some cases.

When you sign into an agreement with a SaaS provider, you are trusting this company with some of your more sensitive data. Whether it be in regards to manufacturing methods, inventory management or your entire employee database, if it falls into the wrong hands it could be disastrous.

There is a real concern of having databases hacked when you consider using the cloud in a public space with multi-user systems or servers that allow multiple users to connect to the same home network at the same time.

Before deciding on a SaaS provider, talk to them about their security efforts. Ask them about things like SSL, HTTPS, Administrator tools, what algorithms are used to generate keys or tokens, etc… Overall, the majority of the providers out there today have decent to outstanding security services but it needed to be mentioned.

Minimal Control

One of the biggest downsides to using a SaaS provider is that they own the cloud system and they are solely responsible to the backend of the system. As a customer, you have very little to no control over how that side of the server is managed.

This means that if something happens to go wrong on their end, you are at the mercy of their IT team. If it takes them a few minutes to a few days to fix a specific issue, you simply have to wait. This could result in loss of business, customers, and massive amounts of downtime while they try to fix it.

There are some horror stories about this floating around the internet, but thankfully it seems to be very minimal.

Final Thoughts

While this is certainly not an exhaustive list of all the pros and cons of using a SaaS provider, it does highlight what we believe to be some of the most important areas to focus on. We hope that at the very least, it will give you some food for thought before you start ripping out your server racks and rushing to find the best SaaS providers out there.

Remember, even the best system, cloud, local, or otherwise, can fail you if you don’t focus them on the areas that they need to oversee. Do your research, choose one that fits your supply chain, and then set out to master it.