As for future projects in the cloud, Shaklee is evaluating the Workday service for its HR and payroll activities.
HR and CRM (customer relationship management) topped the list of enterprise applications licensed in the SAAS model, according to the CIO Insight research, with 36 percent of respondents saying they were using a hosted CRM solution and 36 percent saying they were using a hosted HR solution. Billing/
accounts payable, collaboration and e-commerce were next on the list, with 24, 22 and 21 percent of respondents, respectively, saying they were using such hosted solutions.
Different role for IT
Harris said SAAS really changes the job of IT.
For one thing, the model places a greater burden on getting vendor contracts right—having the right relationship and managing the relationship on an ongoing basis, he said.
“You go back to your businesspeople and say, ‘What are the requirements for a service-level agreement?’ You don’t always do that internally,” Harris said. “You put into the contract detailed service-level specs, and you put around them incentives and consequences. Usually the metrics need to be uptime, response time, severity Level 1 problem resolution and disaster recovery time.”
In addition, working with a SAAS provider shifts the burden of integration.
“If you work the relationship so that you don’t pay until you’re using the service, now the SAAS provider has an equal share—if not a greater share—in making sure that software gets up and running and works,” Harris said. “They don’t get any money until it does, and that means they have to be involved in solving the integration problem.”
Harris added that it’s important to build an exit strategy into the contract if the relationship with a vendor does not work out or if the vendor folds.
“We’ve had a couple of arrangements that didn’t work out as intended, so, as part of our negotiation process, we negotiate some kind of out in case it doesn’t work,” he said. “With one of our SAAS relationships, we negotiated the out to take over the technology and run it internally. And, in that particular situation, we ended up doing that.”
Source: EWeek.com, 2008-03-02