Process Innovation SaaS: An Emerging Business Model

The software industry offers various delivery mechanisms for providing IT business solutions, the most prominent being the IT solutions sold as a license and installed on the infrastructure backbone of the solution consumer. This is also called an on-premise model. The high cost associated with the packaged or home-grown business IT solutions have made it possible only for big players to leverage the productivity gain, ease-of-use, business efficiencies and scale associated with business process automation using technology. A wide user base comprising mainly the small and medium enterprises (SMEs) have been left out of the ambit of business process automation because of the high capital investment and slow return on investment (ROI) associated with implementing IT business solutions.

As the SMEs comprise a sizeable population of the business enterprises, there is an urgent need to offer an innovative and cost-effective business model that will address their need to improve productivity and enable business growth, at an affordable cost. In response to this market need, a new business model that delivers solutions to the consumers as a “service” on a pay-per-use basis is fast emerging as an alternate model. This model, referred to as SaaS (“Software as a Service”) or on-demand model is believed to have the potential to revolutionize the way IT…