Over the last 25-30 years we have seen significant maturing of various aspects of IT, at the same time IT has been guilty of over-promising and under delivering, this gap is crucial in current context where IT has become the corner stone of most successful businesses. But in the last decade developments in the way business is conducted and Information Technology have come together to give rise to a new Software delivery model which has shown exceptional growth and has become the latest buzzword - SaaS and Cloud Computing.
There is a difference between SaaS and Cloud Computing. SaaS is more about applications and services for the end customer which can be business or a consumer and Cloud Computing is a way to provision computing infrastructure on which SaaS applications would sit.
SaaS has significant advantages and there are many a blogs covering them. Simply put with adoption of SaaS, companies need not pay exorbitant prices for hardware, software and customization and need to only pay for the IT services they are using.
While large and mature mid-sized corporate have been able to gain efficiencies and also strategic advantages due to successful implementations of IT solution the same cannot be said for small and medium sized enterprises. The complexity of software applications, prohibitive costs, risk of obsolescence, inability to retain IT manpower and lack of expertise are some of the factors which have made usage of IT difficult for SMEs. On the other hand opening up of world economy due to globalization has presented with an opportunity to SMEs to grow, this growth is possible only when the businesses are able to innovate and build speed, efficiencies and scalability in their operations.
On the technology front three different factors have come together to make SaaS a reality
1. Growth in telecom and internet infrastructure as evident by increased mobile, broadband and wireless connectivity
2. Computer operating systems, hardware and storage systems have matured to such an extent that companies need not buy the hardware. Instead they can lease computing time, storage space and bandwidth as per their requirements from a Data Centre
3. Secure software applications which are capable of mirroring business processes can be developed in a relatively short time. These applications can also be changed as the business requirements change making them easier to use
SaaS and Cloud computing have become extremely popular over the last 2-3 years and have reached an inflection point in 2009. Various factors like maturing of storage, web access and computing technologies, global recession forcing companies to postpone capital expenditure and use of Services Oriented Architecture based business applications have led to this industry exceeding all growth expectations.
While most of the growth and maturity of SaaS and Cloud computing has been witnessed in the Developed Economies there are unique challenges and advantages for the Developing Economies also. Some of these factors which need to be considered when leveraging SaaS and Cloud computing in Developing countries are
- Pricing at which the global SaaS providers are operating are not tenable in Developing countries. Monthly rentals are ranging from USD 15-60 per user per module and in some cases are as high as 150 USD.
- Most of the Cloud computing infrastructure is physically present in US, Europe and other parts of Developed world. Since cyber laws are not uniform across the globe, Governments will have to ensure that usage of Cloud infrastructure which is located outside their country is governed through a well developed cyber laws.
- Internet connectivity is still a problem especially in remote locations and companies need to keep this important consideration in design.
- Usage of IT applications is low in general so the challenge would be to ensure adoption and consistent usage. These would need a well developed training and operational support program.
- All users including Business owners are paranoid about security of their confidential information; these issues need to be addressed unequivocally.
- Not everyone has an access to computers, application have to be simple enough to enable use though a mobile phone using SMS based interaction.
