Wondering why on-demand is the deployment model of choice for so many companies who are implementing new software solutions? While the benefits of on-demand software – also commonly referred to as Software-as-a-Service (SaaS) or hosted software – are substantial, one of the biggest advantages is its ability to eliminate the risk of “shelfware”.
Companies of all types and sizes waste countless dollars every year on shelf-ware – software applications that are purchased, but never put to use. But shelfware doesn’t just drain IT budgets, which are shrinking rapidly in today’s tough economic times. It also makes IT audits and depreciation calculations more complex, and can hinder productivity, leaving end users lacking the business solutions they need to effectively perform their jobs.
There are many reasons why software – bought with the best intentions – becomes shelf-ware. For example, more critical technology initiatives may come up, taking priority and putting deployment on the back burner, challenges with deploying a software solution or customizing it to meet the business needs and more.
Flaws in the traditional software sales model are one of the key reasons behind shelf-ware. Companies pay upfront to acquire a software solution, before they can see firsthand how the end users will benefit, and what type of value it will provide. It’s a major risk, but one that, in the past, organizations have been forced to take. This leads to shelf-ware in two ways. First, there is exposure when it comes to implementation. Huge deployment issues may arise, causing IT teams to abandon the project before the solution is ever even rolled out to end users. Or, the solution itself, once rolled out, may not meet end user needs, resulting in low adoption rates and demand for another package to replace the one originally purchased.
One of the primary advantages of a SaaS solution is that it eliminates the risk of shelf-ware. There is no large initial investment required with SaaS, so companies don’t have to pay until they are actually realizing value from it. If they don’t achieve the desired benefits, they can simply choose not to renew at the end of their contract period (monthly, quarterly, annually), and have paid only for what they have used.
Why on-demand? because SaaS minimizes implementation risk, since there is no need to provision and deploy local servers, install software or configure databases. There is no need to setup operational procedures such as antivirus, backups, periodical maintenance so customers can get up and running quickly and realize value sooner. On-demand software can be deployed rapidly, and seamlessly integrated into any existing technology environment.