My company helps businesses manage their software investments, so we spend a lot of time educating customers about maximizing the value of their relationships with software vendors.
Even though cloud-based subscription software (also known as software-as-a-service or SaaS) has been around for decades, I find that many businesses have not yet developed a strategy for obtaining the best value from these relationships.
That’s despite SaaS becoming the go-to model for new software adoption for many organizations. Research from Gartner, Inc. predicts SaaS revenue will grow more than 17% this year, creating the largest segment of the cloud-based market, ultimately worth a projected $85 billion.
Moving Toward A SaaS-Dominant Future
This established foothold will only continue. Even the providers of enterprise on-premise software (the predecessor to SaaS) expect an eventual 100% transition to a cloud-based model. “We have a big existing on-premise user base and I believe all of them will move (to the cloud),” Oracle CEO Mark Hurd recently noted.
With the business software market moving quickly towards a SaaS-dominant future, business leaders who manage these technology resources should understand how to create more value from SaaS tools by maximizing their relationships with SaaS vendors.
Here are a few of the questions we encourage our customers to ask when they interact with SaaS vendors. We find these questions add value to the relationship, help identify risk and provide customers with a better understanding of what they’re buying.
How Does My Company’s Data Stay Protected?
Data breaches cost big bucks. In the United States, breaches cost companies nearly $8 million on average. As more firms become reliant on SaaS tools, it’s important to know that each tool you add to your portfolio becomes a potential linchpin for a new breach.
While your IT team may dutifully carry out industry best practices for data compliance, safety and cybersecurity, lines of business (LOBs) are overtaking IT as the primary purchaser of technology, including SaaS. According to ComputerWeekly, analyst IDC projects that LOB technology purchases will overtake IT budget spending in 2019, increasing the likelihood that IT best practices won’t be carried out.
If and when you become aware of new SaaS tools used in your organization, vet them thoroughly. How is data stored? What certifications do they hold? What standards have they received accreditation for?
If you’re processing payments information, I consider protocols like PCI DSS a minimum requirement. Another standard to consider is SOC II, which covers best practices and processes for five major areas for SaaS providers, including privacy, confidentiality, security, processing integrity and availability. No matter the vetting procedure, your first question for a SaaS vendor should concern how to protect your data’s integrity before, during and after the relationship. – Read more