An Enterprise Long-Timer's Business Perspective: On-Premise vs. SaaS
A few years ago, I was interviewing for a new position as VP of CRM at an accounting and professional services provider with member firms globally. They were looking to begin an IT initiative to replace their in-house CRM system, which was very poorly adopted. I was asked how I felt about software-as-a-service. With over twenty-five years of experience working at very large enterprise financial institutions and having been the business owner of several on-premise enterprise-sized CRM and marketing solutions implementations, I found that it was very difficult for me to accept that SaaS could possibly compete. Very Difficult.
Fast-forward four more years. I’ve worked as a business consultant at Salesforce now for two years.
At first, I remained skeptical. That is until I was able to dig in and finally get all of my concerns answered first-hand – as an insider and not a customer or potential customer hearing all of the hype. I have summed up the key value and impacts of SaaS from my POV in five points:
“A rising tide lifts all boats”
It is hard to pick the one benefit that floats to the top (pun intended) but this one is really up there. SaaS is the best way to get even close to a “consumer-grade” software and UI experience. Since there are thousands of customers paying into the ecosystem, this translates into thousands of developers working for you. Your functionality pain points are likely to be others’ pain points and when a change is made and put into production, it is there for all SaaS customers to benefit from. So, from the smallest rowboat to the largest aircraft carrier, they all benefit from the rising tide equally. Leverage that!
Get used to a lot of change. Change management needs to become an ongoing focus.
With on-premise I have found that the process to get a change made to the system by your internal technology team can take several months at a minimum, to years as a matter of course. If you do not plan ahead and get your requirements justified and on the list at least twelve months in advance, don’t plan on getting your change live in the next fiscal year. By the time it goes live (if it does) it may no longer be transformational or even relevant.
And don’t even try to get the system platform vendor to add your change request to their product roadmap unless you are a really big fish in their sea and it is upgrade time.
With SaaS, there may be one or more releases a year (Salesforce has three a year, for example). These may or may not include functionality changes that are on your company’s personal wish list, and you do have to decide if your company will embrace them. If you do, then you will have a new challenge to face, and that is change management.
There is some comfort in the old way, knowing that change will take a long time allows you to take a longer time to prep users for it. You will need to get out of that comfort zone and learn how to champion and manage change successfully within your organization. You can do it. I have seen some extremely large enterprise organizations modify their change management processes as they embrace a more agile development and implementation cycle that SaaS affords.
No, the system is not perfect. But you can help perfect it.
Learn how to carry weight and influence the future system functionality. SaaS is like social media in a way: it is an open community where everyone can have a say when they follow the rules and play the game right. For example, in the Winter 2017 release of Salesforce, over 300 IdeaExchange requests were fulfilled that had earned over 95,000 voting points in the Salesforce user community.
That being said, as with any software, it is a constant cycle of improvement and you will always see improvements that could be made, or “customizations” that would make the system better for your way of doing business. Get out there and make your voice heard in the community.
The vendor is motivated to keep you happy – every month!
Since SaaS licensing contracts generally come up annually, you can be very sure that your satisfaction is top-of-mind for the SaaS provider. As a businessperson, I like that. I want the vendor to stay motivated to retain my business long after the sale and I want their ear when it comes to my concerns and recommendations for improvement.
You’ll always be right on-trend
You won’t have to move mountains to get an upgrade completed, it will just happen. (There are some tips and tricks to make that smoother of course – let’s not minimize the importance of preparation prior to each release). However, you won’t end up with a system that is ten years old, three releases behind, on an now-outdated delivery platform, and no longer supported by the vendor should you have technical issues. I know many of my past customers suffered from these business issues and they were very real problems that cost a lot of time, money and resources to solve — if they got solved at all. These were “innovation detractors” of a major kind.
I think you can tell that I have been converted.
For additional perspective, check out this Salesforce ebook: “Your Complete CRM Handbook.”