Today’s economic pressures are resulting in an increasing scrutiny on IT budgets and how to achieve the best return on investment. IT project portfolios are constantly evaluated by the CIOs in light of new budgets and constraints. Clearly IT spending is on the fall, significant budgets cuts are on way, and new initiatives are impacted. BPM initiatives that had initially made their way into the portfolio are now being re-evaluated given the upfront capital cost of procuring Hardware and software. That is not to imply that CIO don’t see the value of BPM …BPM initiatives are still on top of CIO’s agenda. The big question now is what cost effective approaches companies can undertake to quickly implement BPM solutions while reducing project risks and costs. The faster the solution is implemented, the sooner the value is realized, and faster the buy-in from business partners.
In this situation, Software as a Service (SaaS) can clearly provide the effective platform that companies can leverage to not only continue building the momentum around BPM in their companies but also directly reduce the project costs, time, and risks. By shifting the minds away from worrying about risks, companies can focus on the actual problem at hand, improving processes and project Return on Investment (ROI).
Unlike the traditional model, where companies need to procure hardware as well as software to initiate a BPM project, in the SaaS model companies can immediately start the project without the need to procure these resources. The SaaS model allows the organizations to use the Hardware and Software provided by the BPM vendor on a hosted environment. Companies pay typically on per user basis although other models can be implemented. As evident, there are immediate benefits reaped by this approach; reduced upfront costs, and reduced time to delivery.
The BPM vendor hosts the solution in a Hardware cloud that is hosted either directly on vendor premises or on some other vendors with which specific Service Level Agreements (SLA) have been negotiated. This arrangement ensures that the application solution will be available based on service levels mutually agreed upon. The hosting vendor in turn is directly responsible for hardware maintenance and other issues while the customers can focus on Business process solution. Hardware capacity, patches, other regular and non-regular maintenance responsibilities are now the responsibility of the hosting vendor.
In the SaaS model, BPM software is no longer needed to be procured. Software is provided by the BPM vendor directly and ready to be used immediately. Since the software is already installed and configured, the time to install and create environments can now be taken out of the project plan thereby reducing the overall project timelines and costs. The value proposition of BPM through quick wins is definitely achievable in this model with reduced risk.
In the SaaS model, development environment is hosted remotely as well. Companies do need to take into account the cost of developing the solution. There are various options that are available to companies. Companies can use Profession Services organization of the BPM vendor, train their own resources or use a System Integrator. All of the above options are viable options. Which option to pick is determined by companies’ future direction. BPM vendors also partner with several System Integrators to provide an end to end solution that focuses on both the implementation aspect as well as process discovery, analysis, and improvement. Regardless of the option selected, all development work is done on the hosted environment and can be started immediately without the need to install and configure.
Where as advantages of SaaS model are apparent, companies must also take into consideration other aspects of this approach that are not apparent immediately. For one, BPM and SaaS model is not the most wide spread model adopted by the industry. It is still considered to be in its early stages. Secondly, in a true multi-tenant architecture, there are multiple BPM applications potentially from different companies hosted on the same physical server. Although it typically does not pose any issue in the development environment, it needs to be given due consideration in the context of production environment. Sensitive customer data of a company is stored on servers shared by other clients. This risk can however be mitigated through security measures that can be put in place to ensure that data is secured from both internal and external threats. Companies can review the hosted Architecture to understand the limitations prior to implementing solutions in production. Storing customer data on servers that are physically not in company’s premises might not be acceptable and could pose compliance issues.
So where is the SaaS model really beneficial? There are many scenarios where companies can significantly benefit from the SaaS model. If a company recognizes the value of BPM however is forced to cut back on its BPM initiatives than SaaS model can be used. Without committing to Hardware and Software resources, companies can quickly implement a process in weeks. There are vendors in the market like Appian Anywhere, Lombardi Blueprint that quickly provide the platform to quick start the solution.
While hosting BPM solutions through a SaaS provider, company should pay special attention to Service level agreements that they are subjected to. The quality of solution, in the SaaS model, is now deeply dependent on the environment availability, stability, and support provided by the hosting organization.. A solution developed in an unstable environment is not going to get much support from business if it does not functional well and is at the mercy of Hardware.
