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August 2014

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Four Tough Questions You Should Ask Your Applications Software as a Service Provider

Cloud computing continues to profoundly reshape information technology, from startups and spinoffs to the world’s largest businesses and government organizations. That means growing organizations can’t afford to get stuck with last-generation tools if nimbler competitors can leverage next-generation solutions.

The sheer number and diversity of software-as-a-service (SaaS) solutions—many of which have serious pitfalls—can make it daunting when it comes time to choose the right provider. Knowing what questions to ask can help make the process easier.

“Some SaaS cloud providers focus on one business area and insist that the best-of-breed approach is the only way. Others offer a limited range of services, and they are built on first-generation technologies,” says Lisa Schwartz, senior director, Oracle Applications Cloud Product Marketing. “You don’t need to compromise. Look for a modern SaaS cloud provider that has a broad range of cloud application services that you can uptake as you need to and that enables modern best practices across your entire business.”

Every organization is unique. Before committing to a specific solution, you should understand how a particular offering would fit into your overall business strategy, both now and in the future as your organization evolves. Here are four specific questions you should ask every provider.

  • Will I be forced to upgrade?
    First-generation SaaS providers often dictate when your organization must upgrade, which could mean hidden costs, another steep learning curve, and another round of user adoption challenges.

  • Will you keep my data in one database with all your other customers’ data?
    If the answer is “yes,” alarm bells should ring. After all, your data is one of your most important business assets.

    Yet, some SaaS providers actually use the same database—and even the same set of tables—to host multiple tenants’ data. That makes it cheaper for the provider, but it means the customer assumes added risk.

  • Can you support all my business functions, including finance, human capital management, customer experience, and more?
    Carefully investigate how and if a SaaS solution will integrate with the rest of your business applications—especially when the solution is from a provider that only focuses on a single line of business. And remember, even if such integrations are not a priority for you now, they may become so in the future—perhaps sooner than you think.

    In other words, make sure an apparent quick fix doesn’t set up your organization for major integration costs down the line.

  • Are social, analytics, and mobile capabilities embedded into business processes?
    From customers to employees, everyone expects to be able to access both insight and collaborative business processes anywhere, anytime, and from any device.

    Not all SaaS providers deliver modern best practices capabilities like social, analytics, and mobile. Make sure you are not setting yourself on a path that may result in costly integration efforts in the future.

Watch a short video about choosing cloud providers.

For additional questions to ask a SaaS cloud provider, download this SaaS cloud provider checklist.

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