What Are the Advantages and Disadvantages of Software as-a-Service Model - Case Study Example

?Q1: What are the advantages and disadvantages of software as-a-service model? Software as a service model is the full form of the acronym SAAS. It is also called on-demand software model. In this software delivery model, the software is not simply installed on the user’s machine but is hosted on the internet. The user accesses the software and its associated data on the internet by using a web browser. The model has become very common for a lot of business applications inclusive of customer relation management, human resource management, content management, accounting and collaboration. Initially when application deployment used to take place in most companies, the process was a long, tedious and expensive one. Not only would it consume a lot of resource, it could also take years and end up producing unsatisfactory results. Instead, today more and more companies are opting for software as a service option. There are various other benefits of using the SAAS model. It ensures accuracy of data and information recorded and conveyed around. Because, the responsibility of the application is outside the company it alleviates the management of the need for more corporate applications. (Laudon K) While the companies benefit from low cost of implementation of this model, there are some disadvantages that vendors might face. First of all the investment of the vendor can be heavy. He has to build an entire network infrastructure through which the application has to be hosted and delivered. He will also have to ensure that the application is available at all times, it is secure and ensure privacy of customer related information and lastly, ensuring that users have access to latest releases of the software. These aforementioned issues and their solutions are not only time consuming but also costly. Q2: What are some of the challenges facing Salesforce as it continues its growth? How well will it be able to meet those challenges? Sales force faces many challenges. The biggest challenge for the company comes in the form of its competitors. It has to counter the influence of its competitors who are on prying Sales force’s success and trying to replicate it. Some of the bigwigs in the industry who have tried their hands at it include Microsoft, SAP and Oracle. Each of the aforementioned companies has taken out their own subscription based models of the CRM. Then there are smaller companies like Net Suite who have also tried their hands in this market. Industry analysts have already predicted that Microsoft could deride the sales of Salesforce but provide them stiff competition through their available on-demand CRM product. This is because Microsoft has an already established customer base and it would be offering the product at half the price of Salesforce.com. The second challenge that confronts Salesforce is expansion into new areas. It needs to explore and develop business products for other areas as well. The third challenge that Sales force faces is availability. The success of Salesforce depends on its ability to satiate its customers by ensuring that the software is available at all times i.e. 24*7. It will be quite a challenge ensuring that the software is available at all times. Salesforce is keen on countering the challenges it is faced with. It has partnered with Google Apps and is using its services of Gmail, Google docs; Google Talk and Google Calendar to assist its customers accomplish more tasks through the internet. The partnership is also going to act as a buffer to counter Microsoft and both companies are hopeful that it will further galvanize the growth of this on demand software. Another big step to counter challenges is the introduction of Force.com application through which its customers can download above 800 software applications. Qs 3: What kind of businesses could benefit from switching to Salesforce and why? Small and Medium line business can draw a lot of benefits and advantages from switching to Salesforce. This is because these businesses have a huge dearth of resources, capital and investment to develop and host their own software applications. Salesforce.com provides them an easy way out. Various other independent software developers can also benefit from Salesforce. In its Force.com application, Salesforce provided a platform to these developers and promoted their apps by listing them on its Appexchange. The AppExchange, will give small businesses the opportunity to access and download above 800 software applications and various others add ons. Qs 4: What factors would you take into account when deciding to use whether Salesforce.com for your business. I would take into account the following factors before deciding on whether to use Salesforce for my business or not: The cost of using Salesforce.com. How much will it cost me? Is it worth the bargain if I go for out instead of developing my own in-house application? What am I compromising on by opting for Salesforce.com instead of developing my own application? What is the opportunity cost? Weight the two options and then opt for the best one. The third factor that I would consider would be the privacy of information of my customers. Am I being guaranteed absolute and complete privacy of information of my customers? What measures have been taken by Salesforce to ensure that I am given the kind of privacy I want? The fourth factor would be security. How secure and safe is the application? Is there threat from hackers and other malicious attackers out there on the loose on the web. The fifth and a very important factor in my decision would be the availability of the application. Will the application be available at all times? Does it hold the capacity to take on the company 24*7. I wall have to ensure that the application is available at all times in order to meet any emergencies and eventualities. Lastly, I will also consider my capacity requirements. I will check on the storage capacity that I will have access to when using Salesforce.com against the needs of my business and take the best decision accordingly. References: Laudon K, Laudon J. Management Information Systems, Managing the digital firm. Australia: Pearson Education , 2010. Fitzgerland, N. CSR: Rebuilding Trust in Business. London,Unilever and London Business school. Burgeois.Strategy and Environment: A conceptual study. Academy of Managment Review. 1980 Jones, G. Organizational Theory. M.A. Addison Wesley. 1995. Read More