Software as a Service (SaaS) is a relatively new concept in software delivery and one poised to change project management delivery in the immediate future. Instead of buying a server, buying server software, configuring said software, and keeping up with maintenance you simply pay a software service provider a monthly fee to deliver the benefit of the software over the Internet.
The advantages of this approach are:
- No large capital outlay (servers, enterprise software)
- No resource management issues (training staff to install and support software)
- No footprint on existing hardware (no software to install on desktops and no storage issues)
- Pay as you go and only as you need (you only pay for the people using the software and there are no internal scaling issues)
Personally, we are seeing more and more customers coming off failed large scale on-site implementations of enterprise project management (EPM) solutions. What used to cost companies hundreds of thousands of dollars up front is not a much more reasonable monthly fee. There are no long term commitments and if the solution isn't working the risks and costs can be mitigated quickly.
The CIOs we talk to tell us they experienced difficulties getting funding, setting up internally, and then culturally digesting these complex ERP-like solutions. When they finally pull the plug the vendor response seems to be "you didn't support the implementation", "you didn't buy enough consulting from us", and "it must be you as we are the leaders in (insert favorite analyst company here)".
The term I keep hearing around SaaS is "fair value for value" meaning CIOs are looking for reduced time to value, core features, in exchange for a reasonable amount of money.
I suspect with the economy stalling and budgets tightening, more and more CIOs will take a long look at SaaS for their mid-office needs and have the precedence of doing so with the explosion of SalesForce.com and other SaaS tools.
Ironically some day our children will ask "Dad, do you remember when people would install software on their own computers using disks?" I will think back on days like today and say, "Yes, but barely son. Those were dark times in IT best soon forgotten."
Want to hear more about SaaS and how it is changing the world of project and portfolio management? You can download this free podcast / audio presentation directly from:
The PMO Podcast™ Featured Story:
PPM Software as a Service, why SaaS is growing so fast in the world of project management
Virtually yours,
Nick Matteucci, MBA
About the Author: Nick Matteucci is a co-founder of VCSonline.com a web 2.0 project management software company headquartered in St. Louis Missouri. Mr. Matteucci is also an active board member and the Chief Technology Officer for the PMI ISSIG. When not obsessing over virtual project management best practices Mr. Matteucci enjoys spending time with his wife and three small children. He also enjoys travel, running, and all things automotive.
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