Software as a service is generally touted as having no upfront costs, no return on investment worries as it is similar to leasing, 3 to 4-month rapid deployment, and easy exit in the event it doesn’t work. It sounds like a win-win situation; the purchaser has very little risk. The seller has more opportunities as the sales should be easier because of attractive marketing. There are some additional benefits to being a STAKEHOLDER. Ongoing consistency, the longevity of use, comfort, training, with the majority of benefits in the familiarity (A product you know) and synergy of incorporation of your business rules.
About the software
So how can we have both, because even with the entry of ease, there is still substantial risk and an investment of time to deploy? JDi’ s concept of pricing was always low upfront costs. All upgrades, service, and other related support activities are included in the monthly maintenance fee, priced substantially less than all the modules purchased separately. The only upfront costs are a onetime deployment, and contrary to definition deployment is “actual set up” more so than deployment. Of course, there is always the possibility of the data import, which has to be set outside the box since the data import requirement is always a business decision regarding the importance of historical information.
Depending on the system most upfront costs are several hundred thousand dollars, with a substantial maintenance fee behind that for upgrades, new modules, and other related items. Software as a service, which is closely related to leasing eliminates all those upfronts costs, stays competitive by offering enhancements required to comply with changing marketplace requirements, Offers upgrades based on technological advances in programming, and has a reasonable monthly service fee. Providing the vendor credibility is good, this is worthy of consideration. This is actually an on-demand relationship and forces vendor creativity to maintain competitiveness. Further, the client is protected from this software becoming obsolete, with no consideration for ROI and the potential for staying on the cutting edge if the claims manager software selection was a good one to start with.
Risks to consider
Of course, there are risks, which should be considered since software as a service is really in its infancy, which means it’s not mature, the learning curve is constantly changing, but the good news is there’s no lock into a long term legacy system that does not provide the desired result. JDi recommends making the time investment and researching what might be available, as it is undoubtedly worth the effort. The possibility exists that it will not be for you, but you’ll have the comfort level of knowing you are considering alternative business methodology giving your decision considerably more merit than following the pack.
As a prudent software vendor, every sales call is a consulting call with a true desire to help the client as well as benefit from the client’s experiences and needs. Contact and communication always rule which is why the opportunity is a welcome challenge to learning. The investment decision is, to spend lots of money on advertising? or research and development, understanding the market place and speculative brainstorming with potential clients, all of which produce variable results.
