Saas versus on Premise


SaaS versus

SaaS versus On-Premise

Wrestling with software management – SaaS versus on-premise licensing

Sumo wrestling: a clash of titans crashing into each other during six annual honbasho (professional tournaments) in the race to be named yokozuna. Two huge figures too, with top-level wrestlers weighing in at 330 pounds (150kg) – each said to consume around 20,000 calories a day.

With sumo you get a sport that’s steeped in tradition – it goes back 1500 years. Equally, you get one that’s had to adapt to a lot of change in recent years:

  • The sport’s recent resurgence has been based on foreign audiences

  • Recent dominance in the dohyō has been achieved by Mongolian wrestlers

  • When Kisenosato was promoted in 2017, he was the first Japanese-born yokozuna in 20 years

Such changes have caused a clash of old versus new; between traditionalists and progressives; between the huge and strong (conventional), and the more nimble and athletic (Mongolian).

The software management face-off

Look for a comparison in the world of IT, of two equal forces grappling it out for supremacy, and you arrive at the discipline of software management: Of subscription-based models facing off against more traditional license and maintenance arrangements.

That said, it looks like an uneven contest, as businesses increasingly move toward widespread adoption of software-as-a-service (SaaS). Indeed:

The journey to ‘cloud native’

As these numbers show, SaaS models are destined to become the next grand champion. But should we be throwing our legacy technology out of the ring as we race to the cloud?

For newer companies, designed from the ground up to be ‘cloud-native’ this is most likely a debatable point. But for long-established firms, the challenge is to become cloud-enabled first – and only then attempt the journey toward cloud-native.

This is a challenge nicely summarized by Cynthia Stoddard, CIO of Adobe, in an interview where she described her company’s modernization strategy. The key takeaways being:,

  • Throwing out old technology and replacing it with SaaS is risky and unfeasible in terms of scaling to meet business demand

  • Traditional licensing models will need to co-exist with SaaS assets during a lengthy transition period

  • Legacy systems should be componentized, and gradually brought through into a cloud-enabled architecture

Managing the software portfolio

Arguably the biggest issue however is the impact on software portfolio management when shifting to online licenses. With on-premise, organizations can centrally track and monitor usage – and to control what’s being deployed.

But this is not the case with SaaS, and the two distinctions it introduces into the mix:

  • Managed SaaS: which follows the more traditional form of IT asset management, and ensures any new app is deployed via a documented process (and managed by IT)
  • Shadow SaaS: which is acquired and implemented without IT’s awareness, with protocols sacrificed for greater speed and agility of deployment – behavior that’s part of the wider "shadow IT"phenomenon.
  • Realigning SAM capabilities

    It’s important to remember that SaaS is no different from any other type of software licensing. However, the actual process of software asset management (SAM) does need to adapt to stay relevant to the subscription nature of SaaS billing.

    In fact it’s probably more or a realignment of SAM processes to ensure:

    • You have in place a strategic sourcing process that helps maximize the value of existing software entitlements, as you move into an as-a-service model
    • You don’t pay for IT services ascribed to ex-employees, by having a robust onboarding/offboarding process
    • You can avoid hidden multipliers in support contracts by ensuring the data on the maintenance review process is available to validate any fees paid

    Adopting a more strategic approach

    SaaS subscription models also impact the way SAM teams are viewed within the business. Instead of seeing IT spend as a one-time hit to budgets (and therefore a capital expenditure), SaaS billing falls into the operational expenditure bucket.

    This causes a fundamental re-think of the objectives being set SAM teams:

    • Where the focus with on-premise software is on CAPEX – and therefore (predominantly) on cost avoidance
    • While on-premise ways of measuring usage data are focused on totaling up the number of installations of a supplier’s software

    But with SaaS the license metrics required to calculate consumption demands collaboration across the business:

    • By measuring process as well as software, SAM teams can switch from a reactive discipline (managing audits on a case-by-case basis) to a proactive, strategic discipline
    • By splitting products used in separate agreements, you can align metrics to the demands of fiscal reporting – rather than those inspired by the software supplier

    Getting you championship ready

    From on-premise to SaaS, the demand for outstanding SAM capabilities continues to grow. The ability to measure usage, ensure compliance, and ultimately to reduce cost and risk, makes the discipline an essential component to any modern IT strategy. To help, SoftwareONE offers a range of services and technologies to help boost performance.

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