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Is SaaS All It Is Cracked Up to Be?

SaaS, or software-as-a-service, prides itself on its low cost and simplicity.  SaaS is a revolutionary service that charges organizations a monthly fee for their web service.  They do not require installation or maintenance of any hardware because the service is entirely internet-based, unlike their packaged software application competitors.  SaaS also promises greater security and productivity in comparison to other software.  Geni Whitehouse, a CPA and tech consultant, questions the validity of SaaS’s claims.
Whitehouse spoke at an information session entitled “Calculating The True Cost of Ownership in a SaaS World: Is it Really Cheaper?”  Whitehouse challenges SaaS accounting and claims that it does not live up to its promises.  Whitehouse says that it is difficult to make accounting software work in the cloud.  She said, “You just can’t reconfigure an on-premise accounting solution and call it SaaS, and right now no solution is 100 percent SaaS for what CPAs need.”  SaaS vendors make it work to a certain degree, but once you get past the basics SaaS is neither cost-effective nor productive.
Geni Whitehouse

Whitehouse also challenges SaaS’s claim that their software does not require the hassle of hardware, upgrades, or training.  Whitehouse said, “Taking a closer look, you will find this is not always the case.”  Whitehouse explains that while SaaS does initially save companies money in this regard, firms cannot switch 100% of their enterprise to cloud-computing.  This requires them to still use hardware and pay for maintenance.  Once companies can use SaaS for 100% of their activities, the cost savings will start to show.  Until then, Whitehouse asks vendors to show accountants the overall cost savings- not just the initial savings.  For now, SaaS and packaged applications will just have to co-exist until SaaS improves.

[Photo courtesy of gartner.]