Each step in business requires a thorough analysis and understanding of outcomes and benefits. When it comes to deciding on the type of software to use for your business processes, the are two options — SaaS or Software as a Service and custom enterprise software. So which one to choose to get the best outcome?
Let’s take a close look at core differences, pros, cons, and reasons to choose one solution or another.
What is SaaS
SaaS or software as a service is one of the cloud-based services when subscribers are provided with out-of-the-box application software fully serviced by a provider. Such a type of solution is also called software on demand.
SaaS providers independently manage the application, providing customers with access to certain functionality on a subscription basis. In plain English, the business using the SaaS solution does not control or own the infrastructure needed to host the service and just pays money to use it.
The SaaS nowadays offers a wide range of functionality: from CRM to accounting systems. As a rule, the functionality provided by SaaS solutions is built according to the common practice of business process organizing. So typically, you have a choice between several packages of predefined functionality at a different price.
What is Custom Enterprise Software
Custom software is a solution built from scratch and according to the specifics of a particular business. It includes the very functionality the company and stakeholders need. Custom enterprise software solutions are often developed by software vendors specializing in Java, PHP, and other enterprise-oriented technologies.
The process of development usually involves the following steps:
To build the system fully corresponding to the business needs, the first step is to collect all the information about its processes and analyze the requirements. Then the dev team draws up tech documentation, and the development process begins.
The main advantage of a custom software solution is that it’s fully customizable: from the features to the project’s scope.
SaaS vs. Custom Enterprise Software: pros and cons
The core difference between software-as-a-service and custom software is that the first is more a uniform commodity, while the second is a unique solution. But let’s take a look at these solutions in the context of aspects crucial for any business.
1. Speed of Implementation & Initial Setup
- Almost does not require time to deploy, but requires the time to find an appropriate solution
- Rapid user training and integration in company processes
- The implementation takes six months and more, depending on the scope of the project
- Usually takes time to train the users and adopt the solution in a company
2. Customization and Improvements
- Have multiple features already tested, but may have features not meeting your requirements
- Regular updates, but, again, new features may not meet your objectives
- May lack several features specifically crucial for your business
- As a rule, there is a trial period to test the features
- Fully customizable: you define the features
- You also define all the updates and new features to be developed
3. Integration with third-party services
- APIs allows integrating with a wide (and set) range of third-party software
- But may arise problems with integrating with your current software if SaaS does not offer the needed APIs
- Since developed according to the company requirements, it’s built to integrate with any software you need
- At the very start of the project, you define what services, solutions, or your current software it should be integrated with
- Paid by subscription, which helps to plan a budget
- No additional cost as new features are released
- Paid for the work done (the cost differs depending on the scale and specifics of the project)
- The price is rather as the development is time- and resource-consuming
- Maintenance costs may be low if no new features or changes are required
- The software provider defines security terms
- You have to register and transmit certain information to use the software
- You define the security terms you need
- No need to transmit the data to the third-party services
How to Choose Suitable Software
Both SaaS and custom enterprise apps can be a good option, but, of course, not for each and every one. Moreover, business applications are not about software but business processes and the people involved.
Here are the most unified situations when one solution is preferable to another.
1. When to choose SaaS
- Your business is mid-size
- The business processes are not complex or even undefined
- You have no internal IT team or an employee with IT skills
- The IT infrastructure is small, or there is no such at all
- Your company has a stable business model which needs few changes
- You have no big budgets to spend on complex software
- Your business does not require highly-specific software
2. When to choose a custom solution
- Your business is large or global
- Your company has complex and well-established business processes
- You have an in-house IT team or an employee with a strong IT background
- You have a well-established IT infrastructure, and it needs upgrades
- Your company’s business model is continually changing
- You have enough time, money, and resources to develop a
- Your business requires a highly-customized solution
When you choose between a custom or ready-made cloud solution for your business, there are two main factors to consider: the specifics of processes in your company and the budget.
Custom software is all about high customization and adaptation to all the tiny details of your business. That’s why the development of such a solution needs time and money.
SaaS is, as a rule, a quick and affordable solution for companies whose processes do not require unique software solutions.
Originally published at https://intexsoft.com on November 5, 2020.