Accounting Software - Is the future Software as a Service (SAAS)?
I’ve had a number of discussions following my last posting regarding the future of accounting software. Will the market continue to have thousands of applications in use/on sale in 5 years time as it is the case today? What will break this position? One idea gaining ground is the use of ‘hosted’ solutions (trendy buzzword for this now is Software as a Service - SAAS). The mechanism for this is that you access the accounting software package via a web browser and store all your information on the supplier’s servers. The IT industry is talking up this model as the potential future for all software. Will it apply to accounting products?
Obviously users will need reliable web access to use the system – which is probably sort of available today. Users will also need to trust their supplier will keep their data securely and make sure their own servers/software is working day in day out. Leading SAAS vendors like Skype have experienced downtime – but so do servers in your own office. In terms of potential cost saving larger organisations are likely to still need lots of servers to run all the other software products so it may not save much money – although pricing models for SAAS can be different e.g. per user per month with no upfront financial commitment. For small/start up businesses you can now most if not all of the basic software via a hosted service so if you are starting from scratch this may be attractive.
With a hosted solution there is the benefit that anyone anywhere with web access can use the system – so staff can work from multiple offices or say from home
Practically SAAS can work. Emotionally accountants may be reluctant to lose control of their application/data, even if a hosted environment is actually more secure than a server in your office. I suspect it may be the emotional fear that holds back the deployment of this technology. Ironic perhaps that accountants – who are stereotyped as being low on emotion - may not choose accounting software products via the web for emotional reasons!
John glad to see you’re picking up on the SaaS trend in accounting. One of the verticals we’re targeting with CatalystOffice is accounting firms here in the States. We can see a lot of opportunity to remove some of the IT headaches from accounting firms among others. (We launch in a few weeks – http://www.yourdreamoffice.com)
Posted by :Sara |October 18, 2007 at 3:50 PM
Interesting. Are you planning to launch in the UK? If so have you dealt with currency, vat and other UK tax issues - particularly for the accountants in practice? There are a load of new SAAS products being launched - including one from SAP that you might have heard about
Posted by :John Tate |October 18, 2007 at 5:38 PM
You make some good points and hit the right word when you mentioned "emotional". An SaaS based system is a great option in many cases. Working through the emotional concerns of having your financials off of paper and now outside your four walls if difficult to manage for some.
Rebecca Gill
Technology Group International
http://www.tgiltd.com
Posted by :Rebecca Gill |October 18, 2007 at 10:11 PM
Thank you. I have seen quite a few security breaches in my time. One extreme example was a company who were working in a very competitive market. One day an engineer visited - removed the hard disk from the server and replaced it as part of a maintenance program - and then sold the hard disk to the company's competitior.
Paper - particularly in SME's often/usually is poorly protected. Confidential files are often carried - and sometimes lost - on transport. Laptops are often used without any security and can contain highly sensitive information. SAAS can offer much higher levels of protection than a locally run application if properly managed.
Posted by :John Tate |October 19, 2007 at 9:10 AM