Driving Digital Maturity With SaaS Transformation: Part 1 | Deloitte US has been saved
Limited functionality available
Digital transformation can foster a faster, more agile approach to application deployment—a goal shared by many digital businesses. Organizations aspiring to maintain their competitive edge and execute on digital transformation strategies need modern and flexible business applications—enter the “The SaaS (Software as a Service) technology.” SaaS has grown rapidly in the past decade and has become a key driver and deployment model for most commercial business applications, helping applications buyers to leverage technology innovation more rapidly, improve customer experience, and accelerate their transformation growth.
"SaaS are solutions which are delivered on-premise or through the cloud, offered to organizations on a subscription basis which puts the onus of software updates on the provider and gives organizations the flexibility to change the software as needed"
There’s a lot to appreciate about the SaaS model: Flexibility, quick implementation, cost benefits, ROI, and the promise of an always-on pipeline of innovation through continuous updates. Yet just as many digital transformation efforts have stalled, organizations have also been slow to fully embrace SaaS apps or realize the true benefits of SaaS implementations. So how can we look beyond the hype to take advantage of the SaaS? And how are some leading digital mature organizations deploying SaaS? What are some of the benefits? Additionally, to what extent are the expectations of an organization met on the SaaS success factors i.e. Improving processing speed? Integrating seamlessly in the company’s stock? Improving user experience and end-user adoption? Lowering costs?
Let’s find out answers to these questions and some actionable recommendations for organizations considering SaaS in their digital transformation strategy.¹ In our survey, we assessed the value of SaaS solutions by comparing full SaaS stack versus companies with mixed stack by understanding their journey and growth pattern.
1. Companies who moved their entire technology stack to the SaaS reported significant benefits compared to mixed-stack companies
In the survey, we found out that organizations moving their entire technology stack to the SaaS saw significant benefits in multiple areas when compared to the mixed stack organization.² Here are some key benefits reaped by highly mature SaaS organizations:
2. Companies with all-SaaS stacks saw strong results for ROI
In our survey, for all SaaS solutions, a full SaaS stack exceeds ROI expectations for more than two-thirds of our respondents, indicating better business case development for SaaS solutions.³ SaaS model promotes more ownership and accountability to business stakeholders, which can help them to realize benefits faster and reduce friction with the technology management organization. In our survey, we found out that when trying to capture the highest ROI possible, building a consistent stack can provide better results.
Keep in mind that when considering all options for upcoming technology implementations, it is important to recognize that implementation costs have shown in some cases to not be significantly different from previous on-premise implementations.
3. Faster implementations
In the survey, we could see that highly mature SaaS companies experienced far greater speed benefits. Companies who committed fully to a cloud stack realized significant improvements in top-end processing speed, even relative to companies with a 75 percent cloud stack. Organizations that committed to a full transition to the cloud stack made infrastructure changes more quickly, allowing for faster deployment and quicker improvements when feedback indicated the need for changes.
Software decision-makers consistently cite speed and agility among the most important factors of employing SaaS. The configurability of leading SaaS software products is an architectural advantage that simplifies implementation and enables changes to application setup following go-live.
4. Embedding technology innovation in SaaS platforms and ecosystems
The familiarity with application usage allows users to more quickly adapt to SaaS solutions because, in the course of time, they get more comfortable with consistent updates rather than massive overhauls after long time periods. This allows SaaS buyers to recognize the increased value of the technology platform in addition to the functionality of the applications themselves. Organizations, for example, continue to innovate at the platform level with AI and other latest technology innovations in the market.
SaaS solutions enable organizations to adapt to new technologies faster and more easily at the platform level and leverage innovation through the vendors’ ecosystems.
Organizations love the speed, flexibility, and business agility that SaaS enables, but as they adopt SaaS, they can also encounter new challenges, such as:
Akhand Singh is a senior consultant in Deloitte Consulting LLP’s Digital & Cloud Enablement practice, advising global clients across industries to help them activate their digital organizations and prepare them for digital transformations.
Jeffery Hall is a specialist leader in Deloitte Consulting LLP’s Digital & Cloud Enablement practice, advising and managing client business transformations driven by digital innovation.