New technologies can be very beneficial for small and medium-sized enterprises (SMEs), especially technologies that can improve and simplify business management processes without increasing costs. Are you familiar with the concept of Software as a Service (SaaS) and how SMEs can benefit from it? Everything can be managed online, without having to buy expensive programs and without having to install anything on your company computers. When we say everything we mean: accounting billing, customer relations, invoicing and more, so yes, pretty much everything that a typical SME is working with. We’re going to have a look at SaaS for SMEs and the potential benefits for SMEs.
What is Software as a service (SaaS)?
When we talk about Software as a Service, we refer to the set of solutions that allow companies to access services and programs that facilitate their business management. The phrase ‘Software as a Service’ is used as opposed to ‘Software as a Product’ and it signifies that the software solution doesn’t have to be installed on a computer.
It wasn’t long ago when companies had to install a software program on each of their computers if they wanted to employ a business management program, like an accounting program or a payroll system. With SaaS, that is no longer required.
What has changed and how Saas came about?
New technologies, particularly the development of Cloud Computing enabled the introduction of new possibilities when it comes to software solutions. Namely, this enabled the introduction of a new type of software which can be accessed by companies, i.e. by their employees, without having to install the software solution on the company computers. The software is hosted on the servers of another company, the one that provides the service, hence – Software as a Service. The term Software in the Cloud is often used to refer to the same type of software.
Is Software as a Service the same as Cloud Computing?
In short - no. SaaS could be hosted in the Cloud, that is one of the options, but it is not the only one. Cloud Computing services could include a variety of different options, in addition to Software as a Service. Companies that store data in the cloud could offer one of the following services – Infrastructure as a Service (IaaS), Platform as a Service (PaaS), in addition to Software as a Service and all these are alternatives to traditional business management programs. The Cloud offers plenty of opportunities.
What does Infrastructure as a Service (IaaS) mean?
The definition of Infrastructure as a Service is similar to the one of Software as a Service, but in this case the company doesn’t contract the services of a software or management program, it only contracts a server to be able to use it as its own and to develop and store its own programs, web pages, etc.
What does Platform as a Service (PaaS) mean?
The concept of Platform as a Service is another option offered by Cloud Computing. The best way to explain what PaaS is to say that it is a combination of both SaaS and IaaS. In other words, when you get PaaS, you get a virtual space where software solutions are placed, and you can use them to facilitate some of your company processes.
Advantages of Software as a Service for SMEs
The development of new technologies gave small and medium enterprises a lot of options when it comes to digitization. Thanks to Cloud services, SMEs can now access a lot of solutions provided by Information and Communications Technology providers. SMEs can modernize and improve the way they do business management. There are plenty of companies that offer Software as a Service. Let’s see the advantages of this model.
Investment: Typically, you would need to invest a lot less in Software as a Service compared to Software as a Product. You won’t need to buy programs and install them on your company computers, the distribution company will simply provide you access to the software in question, along with login credentials for your employees. The small cost makes this option particularly handy for small business, especially for micro-companies with only a few employees.
Cost: Investment is not the same as cost. In this case, with SaaS you have the option to pay for the package that you are using, which in turn enables you to make calculations and see whether you need to upgrade to a more advanced version, or downgrade to a lower version if, for some reason, you don’t need all options that are offered in your original package.
Flexibility: We touched this subject when we discussed the cost. Namely, if you are an SME that uses SaaS, you get full flexibility and the solution can be adapted depending on the needs of the company. If your company grows, you can choose to get a more advanced package, otherwise, you can keep the same option, or alternatively, if you no longer require all offered services, go with a cheaper option.
Maintenance: This is another aspect that has fiscal relevance, i.e. is connected to the cost. With SaaS, you won’t need to hire extra staff that’s in charge of maintenance, as this is also included in the service and is provided by the company which provides the SaaS to your company.
Multiplatform: As the software is hosted in the Cloud, you will be able to access your resources from any platform, as long as you have a stable internet connection. So, you won’t have to be in one of your company’s computers, you can use third-party computers or even mobile devices such as smartphones and tablets.
Teleworking: Since you can access the SaaS from anywhere, this means that you can offer your employees different working arrangements and options, including teleworking.
This can help you boost employee creativity, but also improve their work-personal balance which, in turn, can lead to greater employee satisfaction.
Update: Updating your software is another thing that won’t be on your list of worries if you opt-in for a SaaS. Again, the company that provides the service is in charge of updating the software, it is their task and they will make sure that your software is always up-to-date and fit for use.
Security: Recent developments enabled SaaS providers to solve one of the biggest issues – security. The perceived lack of security was the strongest and most common reason that deterred SMEs from opting for a SaaS. Companies feared that their customers’ data won’t be protected, but with encryption technology, that problem is solved. Data protection is a key priority for all providers of SaaS.
What is the Software as a Service used for? Examples of SaaS solutions
The advantages of Software as a Service made this option very popular and we’re witnessing an expansion in the number of companies that implement SMEs. SaaS offers companies the possibility to access essential programs and resources in Enterprise Resource Planning (ERC). You may wonder what type of ERC programs we’re talking about. Here are some examples:
Payroll programs
Invoice programs
Accounting programs for SMEs
Inventory, logistics and shipment programs
Sales programs
Infrastructure maintenance programs
Business administration programs
Customer service programs (call centers)