• SAAS vs traditional software

All Contents © 2006 Burton Group. All rights reserved.

Burton Group Take 5!Software Smackdown – SaaS vs. Traditional Software Applications Lyn Robison, Analyst, Application Platform StrategiesMarch 19, 2007

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Burton Group Take 5: Software Smackdown

Software form factors - When is SaaS best?• Software as a service (SaaS)• Commercial off-the-shelf software (COTS)• Custom developed software (CDS)

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Benefits, Drawbacks, and Demands• Organizational burdens? • Organizational flexibility? • Conforms to technical architecture?• Financial considerations?• Risks?

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Custom Developed Software• Organizational burdens? Development, documentation,

and support• Organizational flexibility? No need• Conforms to technical architecture? Yes (until it

changes)• Financial considerations? High initial costs• Risks? Implementation risks are high

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Commercial Off-The-Shelf Software• Organizational burdens? Operations and some

development• Organizational flexibility? Org must fit software• Conform to technical architecture? Perhaps• Financial considerations? Variable costs (coarse-

grained)• Risks? Relatively low

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Software as a Service• Organizational burdens? Some development• Organizational flexibility? Org must fit software• Conform to technical architecture? No• Financial considerations? Variable costs• Risks? Try before you buy, but data lives outside

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And the winner is…• CDS offers the potential for competitive advantage• COTS offers operational efficiency for generic business

processes• SaaS offers the fastest time to value for generic

business processes

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The Future of Software• Locally-hosted SaaS• SaaS and SOA• SaaS and smart clients

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See Burton Group’s Application Platform Strategies upcoming overview, “Build, Buy, or Borrow: Choosing Custom Development, Open Source Software, Commercial off-the-Shelf Software, or Software as a Service,” for references and more information

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• SAAS vs traditional software