Business Customers Set Hopes High for SaaS Providers
Attendees at a SaaS conference are warned that channel partners and vendors are being judged on their ability to deliver reliable, cost-effective SaaS implementations that go beyond traditional agreements. SaaS providers must emphasize service more than technology to be successful.
Although the current economic malaise may spell opportunity for Software as a Service (SaaS) providers, they will have to work hard for it, providing service above and beyond traditional availability as business customers become more demanding about their SaaS installations.
"People expect the system to be up and running 24x7, 365, but even if we do that it's possible for a customer not to be happy because they may have an expectation beyond pure quantitative metrics," Trisha Gross, CEO of SaaS integration solutions provider Hubspan, said during a panel discussion in San Jose, Calif. at SIIA On Demand, the Software Information Industry Association's conference on SaaS.
"Customers want to know if the (SaaS) solution solves the problem they have, and that's the qualitative aspect," Gross said. "It's even more important than the quantitative aspect because in SaaS, we're there for the long haul and the customer must be happy with what we offer."
Other panelists agreed, including Frank Bruno of data protection and recovery solution provider Iron Mountain. "I buy SLAs [service-level agreements], and I expect the seller to dazzle me," said Bruno, director and senior business strategist for intellectual property management at Iron Mountain (NYSE: IRM). "It's important that companies try and exceed expectations and go the extra mile."
The assertion comes as SaaS vendors are finding themselves in the limelight with enterprises seeking to offload costs associated with maintaining their own software or storage infrastructures. At the same time, that heightened attention also highlights SaaS players' glitches or failures.
Amazon.com found that out following outages at its hosted storage service, S3. Its lack of SLAs and dedicated user support beyond online forums exacerbated the problems customers faced when they could not access their data for hours. Amazon has since introduced SLAs and e-mail support.
Some industry insiders have said that SaaS companies should focus on service and less on talking up their technology, a view supported by panelist Bill Hicks, CIO and senior vice president of SaaS at services provider Ultimate Software. The most important thing for customers is trust, he said. "If you say you're going to do something you need to make it happen, and that involves trust and integrity," Hicks said.
Panelist Philippe Courtot, chairman and CEO of on-demand vulnerability management and policy compliance solutions provider Qualys, said it is critical for SaaS players to exceed SLAs because there are few obstacles to a customer abandoning one supplier in favor of another. "It's much easier to switch from a SaaS application than a normal application because you don't have to pull out the application and replace it and test it and secure it," he said.
In future, customers will demand more from SaaS providers, Courtot warned. "I can see that, in the near future, they would want guarantees of quality of service, guarantees of security of data, guarantees of data privacy," he said.
(This article was adapted from Internetnews.com)