According to a recent survey many IT users in the U.S. and U.K. are “underwhelmed” with SaaS. Software as a Service (SaaS) has gained in popularity as IT looks to cut costs, however it seems a lot of customers are not yet fully satisfied with the results.
The Gartner survey of users and prospective users of SaaS solutions indicates that while the SaaS model is more widely accepted now 58 percent of companies plan to maintain their current levels of SaaS over the next two years. Only 32 percent said they will expand while 5 percent say they will decrease levels or discontinue.
“Our research findings did not exactly provide a ringing endorsement of SaaS, in fact I would go as far as to say that satisfaction levels among SaaS users are little more than lukewarm,” said Ben Pring, research vice president at Gartner. “Although macroeconomic factors would seem to favor SaaS providers, almost two thirds of respondents said that they planned only to maintain their current levels of SaaS in the next two years.”
When asked why they decided not to use SaaS 42 percent cited the high cost of service, 38 percent said it was the difficultly with integration and 33 percent said the solution did not meet their technical requirements.
Twiggy Lo, the Gartner principle research analyst said “The underwhelming customer satisfaction” cited by the survey point to issues that still need to be addressed and resolved before SaaS customers are more satisfied.
Points cited that SaaS vendors need to improve on include:
- Truly delivering lower total cost of ownership. Not just the up-front costs, but the costs to maintain and support the deployment.
- Easier deployments that do not require expensive consultants to support and maintain. These cost eat away at the savings incurred.
- Better integration that recognizes how customers run now and will run in the future. The needs of the business are and will continue to change. SaaS solutions must be able to grown and expand with the business.
- Reaffirm that SaaS solutions are lighter, simpler, more intuitive, and more agile.
Other concerns such as security and privacy issues, ease if integration and not being able to meet the technical requirements keep many potential customers sitting on the sideline. With security issues at the top of most IT department agendas this is not surprising.
While the Gartner findings indicate customers and not totally satisfied with their SaaS solutions I think it opens the door for some SaaS vendors to make the improvements needed and corner their niche of the market. SaaS is still a relatively new model that obviously still has growing pains.