attractive option, which is being explored by Financial Institutions, is
model, which has both a recurring subscription fee and a 'pay-as-you-go‘ model
for procuring software licenses. This allows Chief Financial Officers (CFO) to
forego the requirement of sourcing considerable capital expenses to buy
perpetual licenses (for deploying IT systems that handle functions such as CRM
and ERP) thus allowing them to conserve cash for other critical functions.
Other advantages of SaaS that
might lure companies are faster time-to-market and flexibility. SaaS is a
good case for disruptive technology, which is making customers take a hard look
at traditional software deployment. SaaS is a component of Business Process
Outsourcing and not a stepping stone towards it. Technologies such as
Service-Oriented-Architecture and Web-Services permit SaaS to
be deployed in accordance with usage levels SaaS typically works on a web-based,
multi-tenant model. It is distinct from the Application Service Provider (ASP)
model, as their IT architecture is quite different. While ASP works on a client
server model, SaaS is
dependent on the internet as a channel of delivery.
SaaS has been spearheaded by Salesforce.com's CRM, sales force automation applications, and NetSuite's 'net-native' enterprise resource planning applications. In the U.S., Wachovia Bank and Bank of America deploy software from Taleo.com, a pure-play vendor of the Talent management Software based on a SaaS model. In India too, the On-Demand ERP solution from Ramco Systems is available on a SaaS platform. Oracle Corp. offers database and middleware technology on SaaS. Misys Banking Systems already has treasury management software for managing working capital and liquidity, available for commercial deployment on a pay-per-use SaaS basis . In the banking world of the future, partnerships are crucial, especially partnering for technology. Leveraging optimal processes onto optimal technology will help create value. SaaS could well play the role of the catalyst in the transition to the
'Lean Banking' world of tomorrow.