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The SAAS model is very attractive for a number of reasons. A software-as-a-service subscription model puts the onus on vendors to deliver the goods every month, and the underlying economics of multitenancy mean that vendors can continue improving and adding functionality at relatively low cost while keeping prices (relatively) low.
The SAAS model also frees customers from having to maintain IT infrastructure, something which is often not a core competency.
According to Wikipedia:
“Software as a service … is a model of software deployment where an application is hosted as a service provided to customers across the Internet. By eliminating the need to install and run the application on the customer’s own computer, SaaS alleviates the customer’s burden of software maintenance, ongoing operation, and support. Using SaaS also can reduce the up-front expense of software purchases, through less costly, on-demand pricing. From the software vendor’s standpoint, SaaS has the attraction of providing stronger protection of its intellectual property and establishing an ongoing revenue stream. The SaaS software vendor may host the application on its own web server, or this function may be handled by a third-party application service provider (ASP). This way, end users may reduce their investment on server hardware too.“
Phil Wainewright explains why SAAS is taking over the software landscape and why enterprises will have to confront implementation and integration headaches.
“The megatrend that powers SaaS is the same one driving Web 2.0, SOA and every other expression of today’s increasingly Web-connected world. Fundamentally, the infrastructure of the Web allows us to cut out much of the location-dependent friction that gets in the way of communicating, collaborating and trading. Software used to be delivered in boxes and had to be installed in the same building as the people that used it. The Web removes those constraints, enabling SaaS-and SaaS in turn becomes the foundation for innovative new ways of interacting and doing business.“
So it’s no surprise that SAAS applications are gaining more and more ground within the enterprise.
Data Quality Integration Issues
But most companies of any size (except for startups) already have on-premises software in their environments that they’re not about to rip out. When they select SAAS applications, often as point solutions, they’re faced with the challenge of integrating those hosted applications with their legacy software.
Another issue customers face when integrating SAAS and legacy applications is data quality.
For instance, many CRM SAAS applications have less mature data models and might not have tables and fields for every piece of data that an on-premises ERP system from SAP would have.
So while it may seem easy to map the CRM application to the ERP system, the reverse is much trickier, noted Eric Berridge, co-founder of SAAS integration specialist Bluewolf.
In these cases, customers need to write scripts to extract data from on-premises databases, transform the data and schedule the file loads into the on-demand application.
Informatica is one vendor offering data integration services specifically with this problem in mind. Ash Kulkarni, senior director of product management at Informatica, noted that customers have to be assured that data isn’t getting corrupted as it’s being shuttled from one system to another, or enterprise adoption of SAAS will stall.
“Without data integration, on-demand computing will not function in the enterprise. You will always have to integrate and be able to trust the data,” Kulkarni said.
For the record, Informatica uses 13 different on-demand applications internally.
Tips for Successful SAAS Integrations
Beyond buying a data integration application, there are a few things customers should keep in mind when thinking about this kind of integration, Berridge told eWEEK.
– Think about what information is actually valuable to your end user, whether it’s a sales rep or a manager, and make sure that making a given piece of data available through an integration provides a return that’s actually worth the effort.
“Mapping fields from a SAAS to a legacy application can take time, and at the end of the day, the No. 1 piece of advice is integrate only what is going to increase adoption or deliver true productivity improvements on the back end,” Berridge said.
To that end, customers should have an idea of how they’ll measure improved adoption or productivity.
– Make sure you have a solid strategy in place for guaranteeing data quality. In particular, watch for duplicate records and fields that don’t map to the system of record.
– If you want to custom-code your SAAS application, consider using third-party tools rather than an in-house developer. If you rely on a developer, that person may no longer be available in the event of a bug or when there’s an upgrade or enhancement.
– Finally, don’t overbuild or overengineer your integration. Business people should be allowed to determine the process, and IT should support that process.
That last point was also stressed by David Stover, chief financial officer of Asahi Kasei, a diversified textile manufacturing company with over $10 billion in consolidated sales. His company recently migrated from an SAP ERP system to one from NetSuite.
Stover explained that data has to flow between the new NetSuite system and the company’s legacy materials handling application, and said the new hosted application “readily integrates with the complexity we have.” The integration process took three months, “half the time of other similar integrations,” he said.
If he had it do over, he said, the one thing he would do differently is allow his business users to provide specifications rather than allowing NetSuite to “send their MBAs in there and do a whole business redesign.”
Stover recommends having the SAAS vendor demonstrate the new system to business users and have them work with it for a while. “Then come back and see how you can configure it yourself and then get the [NetSuite] redesign people after that.”