What is Software as a Service (SaaS)? Move Your Software to the Cloud
To understand what Software as a Service is and how to use it, let’s explore some real-world examples.
- January 08, 2019
Updated March 3, 2021
In This Article:
SaaS is simple to understand. Rather than installing software directly on your computer, it is instead stored and deployed through the cloud.
Read about the advantages of SaaS solutions compared to other service models.
In addition to SaaS applications hosted in a public cloud, there are also hybrid and private options to consider based on your company’s needs.
Read about the different types of SaaS applications available on the market.
By hosting business software applications in the cloud, SaaS can help improve your organization's efficiency, effectiveness and collaboration across locations.
Software as a Service (SaaS) might not be a familiar term, but you may have heard of it in relation to another trending term — cloud computing. For a quick definition: SaaS is one of the three main types of cloud computing, along with Infrastructure as a Service (IaaS) and Platform as a Service (Paas). SaaS refers specifically to business software applications that are delivered on demand via a cloud provider instead of being deployed on local platforms. The phrase "as a service" refers to the fact that users pay for the applications as a subscription rather than purchasing the software outright. In this post, we’ll provide an in-depth guide on what SaaS is, the advantages of SaaS, and the types of SaaS solutions available today.
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What is SaaS?
SaaS is simple to understand. Rather than installing software directly on your computer, it is instead stored and deployed through the cloud. Need to use your graphic design software but don’t have your work laptop handy? No problem! If the software is delivered via the cloud, all you need is a device with an internet connection and a web browser or a downloaded cloud application to access the tools you need.
Some examples of SaaS include office productivity software, cloud security and collaboration solutions, mobility management applications and more. You may already be familiar with common SaaS applications such as Microsoft 365, Adobe Creative Cloud and Box. We’ll dive deeper into the types of SaaS solutions available later in this article.
Advantages of SaaS Solutions
SaaS takes several hardware needs out of the business equation. In a web-based model, the software vendors host and maintain the servers, databases, code and other components that constitute an application. Since companies do not have to install and run SaaS applications on their own computer platforms or in their own data centers, the need for expensive hardware acquisition (and subsequent installation and support) is eliminated.
Using an application as a service allows for easy scalability to meet the ever-changing needs of your business. As your business grows and your bandwidth and number of users shift, it is easy to add more licenses or features to your software. This is not as simple when you have to host the software yourself. When hosting software privately, for instance, the quick addition of more software users could put a strain on your servers and other hardware, forcing expansions and upgrades for which you were not prepared.
SaaS application providers take care to keep their platforms updated, so you do not need to worry about falling behind. With web-based software, it is easy to perform updates and patch management when problems arise or new features are released. You won’t have to purchase new software every year to ensure your employees are using the most up-to-date systems.
There are two main ways in which SaaS is more flexible than traditional, locally-hosted software:
- Budgeting. Instead of having to purchase software and licenses for an upfront cost, SaaS subscriptions are usually offered on a pay-as-you-go model with a recurring monthly or annual fee. This allows businesses to better manage costs and predict future budgeting needs.
- Access. SaaS is also more flexible than traditional software installations because it allows users to access it anytime, from anywhere. With accessibility from any internet-enabled device and location, a user’s workplace is not limited to one desktop computer in a cubicle. Instead, employees are able to work from home or on the road. Some SaaS solutions even come equipped with offline functionality, which means that users can download SaaS applications to their devices for use even without an internet connection.
Small- to medium-sized businesses are the ideal users of SaaS, especially if their business processes are fairly straightforward. While SaaS solutions can be effective for enterprise businesses as well, some solutions might not be able to handle the complex requirements of large businesses without additional configuration. Speaking to a cloud expert is the best way to determine which SaaS applications are best for your business.
Functionality & Customization
Hybrid, private or on-premise cloud platforms offer more features and customization compared to completely web-based SaaS solutions. Certain elements can be configured to tailor the solution to a business’s specific needs, including additional security and uptime requirements.
Control & Security
SaaS applications for businesses typically have built-in security solutions, including multifactor identification, but some companies and government entities have stringent security policies that cannot be met with a strictly web-based service because of the fear of data hacks or breaches. For this reason, on-premise, hybrid or private cloud deployments may be the way to go because they offer more control and stricter security to meet business and regulatory needs.
Types of SaaS Solutions
There are many types of SaaS applications available. Here are some common SaaS software types that can benefit your business processes and users:
- Customer Relationship Management (CRM) Software. Manage customer data, track customer interactions, compile business information and automate sales.
- Enterprise Resource Planning (ERP) Software. Integrate various functions into one complete system to improve efficiency and empower information sharing.
- Accounting Software. Keep your finances organized and properly tracked to ensure your business is growing as it should.
- Project Management Software. Plan projects, manage schedules, allocate resources and communicate deadlines to complete projects on budget and on time.
- Email Marketing Software. Optimize message delivery while automating marketing emails.
Other types of SaaS applications include billing and invoice software, collaboration software, web hosting software and Human Resources software. With all the SaaS options available, you can pick and choose which cloud products make the most sense for your business. Some popular SaaS business products include Concur, Slack, Microsoft Office 365, Salesforce.com and Dropbox, just to name a few.
Making Your Decision
By hosting business software applications in the cloud, SaaS can help improve your organization's efficiency, effectiveness and collaboration across locations. Many businesses have made the switch to SaaS in order to reduce costs, enable employees to use programs anywhere at any time, and easily scale the software as employee count fluctuates. Some larger enterprise businesses, however, have decided to stick with on-premise software due to increasing needs for complete data ownership and total ownership of security.
Discussing your needs with a cloud expert is the best way to decide if SaaS is the best option for your business.