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Not All SaaS is really SaaS!

SaaS is a fast emerging software concept that allows you to consume software as a subscription via your internet browser. SaaS may appear new but it has evolved over a decade from its first avatar, ASP or Applications Service Provider. World over companies or all sizes across all industries are adopting SaaS for deploying new applications and replacing old legacy ones. Among business applications, CRM or Customer Relationship Management and HR applications are most suited to deployment in the SaaS model. However, as often happens with so many terms in the IT industry, the definition of softwareas-a-service, or SaaS, has been over-stretched as vendors are jumping on to the SaaS bandwagon.

Hosting and Subscription alone dont make SaaS

SaaS software runs on the provider's premises, not the customer's, and payment is by subscription spread over the term of the contract rather than as an upfront license fee. There are key advantages that flow from these, mostly to do with amortizing the cost of acquiring, implementing and operating the software. Costs are shared across more than one customer, yielding economies of scale.

Multi-tenancy is the Key differentiator

Multi-tenancy refers to having all customers running on a single unit of the live software. Unfortunately, there are countless vendors out there who haven't yet reached this critical level. Most of them are holding back from multi-tenancy because they're saddled with conventional software code that isn't architected that way. It'll take them time and a massive re-engineering effort to switch (if they ever manage to). There are huge benefits to be gained by the customer through true multi-tenancy. Low-risk rapid implementation. The most important is that customers don't have to wait for a custom technical implementation. With multi-tenant SaaS, the software is already up and running in the vendor's data center in advance. This has an enormous impact both on the customer's exposure to risk when getting started and on the vendor's business model. Having the software already operational means that customers can go live in a matter of days or weeks, and they're free to phase in the roll-out to cause minimum disruption to business operations. Vendors can offer trybefore-buy trials and demonstrations at little or no cost, and there's a low overhead to adopting an iterative style of implementation in which a pilot group of users can test the look, feel and structure of the application and give feedback before a full production roll-out begins.

Global Groupware Solutions Limited 828 Udyog Vihar Phase V Gurgaon 122 016, Haryana, INDIA Phone: +91-124-478-9999 www.employwise.com

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Configurability replaces customisation. Another important benefit or multi-tenancy is enabling policy-driven configuration of applications as a means of customization rather than the custom coding favored by conventional software vendors. Multitenancy obliges vendors to push greater configurability because their customers want the flexibility to modify how the applications work for them, even though the underlying software code has to be the same for everyone. This further enhances the capacity to deliver the business results the customer wants to achieve. Single software version: With a single multi-tenant software all customers are automatically upgraded to the latest version. All customers not only get the latest innovations and improvements in the software, they also avoid the risk of being orphaned on an old unsupported, unmaintained version. SaaS vendors only need to maintain one (current) version of the software, and every fix and enhancement goes to every customer. Multi-version vendors end up spending 70-90 percent of their development effort simply on maintenance and fragment their maintenance efforts over more and more versions of the software and each fix applies to a small subset of customers. Shared Infrastructure: Multi-tenant allows multiple customers to run on the same infrastructure. Most people think of servers as the main infrastructure cost, but even more costly are the cost of database licenses and other infrastructure software, the 20%-per-year maintenance costs for all infrastructure components, and (most importantly) the operations personnel costs: DBAs, system administrators, network administrators, etc. Vendor stability: Multi-tenancy delivers the highest economies of scale which enable true SaaS vendors to become profitable and therefore financially stable at lower customer price-points and also grow their revenues by delivering smaller customers whose single instance footprint may not be otherwise cost justified at SaaS price points. Customers should remember that they remain vulnerable to the financial viability and business continuity of their SaaS vendors

Scalability is Essential
The SaaS business model involves supporting a very large number of customers and even larger number of users on a 24x7 basis anytime, anywhere. Thus a true SaaS application needs to be architected and built such that it is capable of supporting these very large volumes. Many legacy client-server applications now being offered as SaaS were never designed for such large deployments and will probably not scale-up beyond the first few implementations. A true scalable application means maximizing concurrency, and using application resources more efficientlyfor example, optimizing locking duration, statelessness, sharing pooled resources such as threads and network connections, caching reference data, and partitioning large databases.

Global Groupware Solutions Limited 828 Udyog Vihar Phase V Gurgaon 122 016, Haryana, INDIA Phone: +91-124-478-9999 www.employwise.com

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The Software-as-a-Service Maturity Model

Broadly speaking, SaaS application maturity can be expressed using a model with four distinct levels. Each level is distinguished from the previous one by the addition of one of the three attributes; is scalable, multi-tenant-efficient, and configurable.

Level I: Ad Hoc/Custom
At the first level of maturity, each customer has its own customized version of the hosted application, and runs its own instance of the application on the host's servers. Architecturally, software at this maturity level is very similar to traditionally-sold line-of-business software, in that different clients within an organization connect to a single instance running on the server, but that instance is wholly independent of any other instances or processes that the host is running on behalf of its other customers. Typically, traditional clientserver applications can be moved to a SaaS model at the first level of maturity, with relatively little development effort, and without re-architecting the entire system from the ground up. Although this level offers few of the benefits of a fully mature SaaS solution, it does allow vendors to reduce costs by consolidating server hardware and administration.

Global Groupware Solutions Limited 828 Udyog Vihar Phase V Gurgaon 122 016, Haryana, INDIA Phone: +91-124-478-9999 www.employwise.com

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Level II: Configurable

At the second level of maturity, the vendor hosts a separate instance of the application for each customer (or tenant). Whereas in the first level each instance is individually customized for the tenant, at this level, all instances use the same code implementation, and the vendor meets customers' needs by providing detailed configuration options that allow the customer to change how the application looks and behaves to its users. Despite being identical to one another at the code level, each instance remains wholly isolated from all the others. Moving to a single code base for all of a vendor's customers greatly reduces a SaaS application's service requirements, because any changes made to the code base can be easily provided to all of the vendor's customers at once, thereby eliminating the need to upgrade or slipstream individual customized instances. However, repositioning a traditional application as SaaS at the second maturity level can require significantly more re-architecting than at the first level, if the application has been designed for individual customization rather than configuration metadata. Similarly to the first maturity level, the second level requires that the vendor provide sufficient hardware and storage to support a potentially large number of application instances running concurrently.

Level III: Configurable, Multi-Tenant-Efficient

At the third level of maturity, the vendor runs a single instance that serves every customer, with configurable metadata providing a unique user experience and feature set for each one. Authorization and security policies ensure that each customer's data is kept separate from that of other customers; and, from the end user's perspective, there is no indication that the application instance is being shared among multiple tenants. This approach eliminates the need to provide server space for as many instances as the vendor has customers, allowing for much more efficient use of computing resources than the second level, which translates directly to lower costs. A significant disadvantage of this approach is that the scalability of the application is limited. Unless partitioning is used to manage database performance, the application can be scaled only by moving it to a more powerful server (scaling up), until diminishing returns make it impossible to add more power cost-effectively.

Level IV: Scalable, Configurable, Multi-Tenant-Efficient

At the fourth and final level of maturity, the vendor hosts multiple customers on a loadbalanced farm of identical instances, with each customer's data kept separate, and with configurable metadata providing a unique user experience and feature set for each customer. A SaaS system is scalable to an arbitrarily large number of customers, because the number of servers and instances on the back end can be increased or decreased as necessary to match demand, without requiring additional re-architecting of the application, and changes or fixes can be rolled out to thousands of tenants as easily as a single tenant.

Global Groupware Solutions Limited 828 Udyog Vihar Phase V Gurgaon 122 016, Haryana, INDIA Phone: +91-124-478-9999 www.employwise.com