It's been almost a year since I shared the experiences of exercise equipment retailer 2nd Wind, which used several software-as-a-service applications to cut its annual IT budget from $670,900 to $259,250.
A SearchCIO.com article illustrates some of the savings enjoyed by hair-restoration provider Bosley Medical Institute after it outsourced five of its applications to SaaS providers. Specific numbers aren't provided, darn it, but Bosley's IT director says the company now spends 20 percent to 30 percent less on annual maintenance fees. That's a pretty big deal, considering the growing outrage fueled by maintenance fee increases by software providers like Oracle and SAP.
A bonus for Bosley: Application uptime has improved. Though the company had experienced problems with inbound and outbound dialing, those problems have largely gone away since those applications were moved into the cloud.
The article also touches on integration, which has been a challenge in at least some SaaS deployments. It doesn't sound like it was a big deal for Bosley, though, which built adapters from the SaaS vendors' data centers to its own data center to integrate and aggregate information from the various SaaS applications into a central Siebel CRM system. One of Bosley's drivers for moving to SaaS was a desire to centralize its data for better business intelligence, an aim it seems to have achieved. Several SaaS users I've interviewed and/or written about in the past, including Ingres CIO Doug Harr, have stressed the importance of asking SaaS providers about their data-integration capabilities up front to avoid unwelcome -- and expensive -- surprises.
Bosley's aggregated information is replicated in the company's SQL Server 2008 database, which has a homegrown reporting system built on top. IT director Mark Davenport tells SearchCIO.com he is now considering replacing the homegrown BI reporting system with SQL Server Reporting Services.
Consolidating applications was another of Bosley's goals, one that it achieved, though not without a little pain along the way. Davenport cautions that it's important to determine which aspects of decommissioned applications may still be needed during the switch. He said:
Once a system is shut down, information could be lost and you will find yourself scrambling.