May 10, 2010 – A new study on corporate performance management validates that the total cost of ownership for software as a service solutions is significantly lower than that of on-premise solutions.
The study by Hurwitz & Associates, "The TCO Advantages of SaaS-Based Budgeting, Forecasting, and Reporting," interviewed a cross-section of companies using SaaS solutions as well as on-premise CPM solutions. The research was backed by Adaptive Planning, a provider of on-demand financial planning solutions.
SaaS eliminates the need for companies to buy, deploy and maintain IT infrastructure or application software, accounting for the biggest cost difference between SaaS and on-premise models. While there is no infrastructure cost associated with the SaaS model, the hardware, infrastructure software and personnel costs required for the on-premise model may range from $150,000 for 10 users to more than $275,000 for 100 users over the course of four years, according to findings. The SaaS model also has lower costs associated with application implementation and support, and user training.
According to the report, the SaaS model also delivers benefits beyond TCO savings through decreased risk, faster deployment and productivity, increased flexibility, higher customer satisfaction, and improved reliability and performance.
"Via the SaaS model, companies of all sizes can gain access to enterprise-class solutions without incurring large upfront costs, or having to hire expensive IT staff for initial implementation and ongoing management,” said Sanjeev Aggarwal, Partner at SMB Group and Hurwitz & Associates.
The full report is available here.
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