'Software as a Service' (SaaS) continues to gain momentum among software business executives as a more cost effective and easier to control delivery mechanism. The benefit of SaaS is a recurring, predictable revenue stream. However, the move to SaaS often leads ambitious software companies finding themselves with two major headaches:
How do they continue to deliver excellent service without making major capital investments in essential IT and facilities infrastructure?
How do they minimize the ongoing operating expenses and tech personnel costs of being at the leading edge of a very competitive environment?
Below are 7 essential questions you should ask before selecting a SaaS hosting provider.
1) Is a 100% service guarantee the same thing as an SLA?
SaaS hosting providers offer a certain level of functionality to their customers, with the level of service being specified in a Service Level Agreement (SLA).
Many SaaS hosting providers will offer a "guaranteed 100%" uptime. However, this doesn't mean they deliver 100% uptime. Instead, the SaaS hosting providers receive a service credit if 100% uptime isn't delivered. Therefore companies should carefully review the provider's uptime statistics and SLAs to make sure it is consistent with the SLA being offered to customers. Also ask for written details on how they deliver their electrical power, network and server SLAs.
2) Do they get the big picture?
Want to know a SaaS company's worst hosting provider nightmare? Signing a contract only to discover that their provider does little more than deliver 'ping, power & pipe'.
What's saved in low monthly costs is lost many times over by not being able to expand the infrastructure in order to support rapid growth, or recover quickly from operational problems. Be sure to gain a full, written understanding of the technical and business relationship that will be in place before signing a contract with a SaaS hosting provider.
3) Do they offer 'high availability' managed dedicated servers?
Business-class data centers require significant capital investments to provide and maintain space, power, cooling and network functionality in a way that is cost-effective for SaaS companies to take advantage of. At the server level this translates into being able to deliver a range of affordable, high-end managed server solutions that match business requirements.
Contrast that approach with one where a SaaS hosting provider assigns an in-house developer the often hurried task of deploying poorly configured servers for testing, staging and even production. That infrastructure quickly becomes a growth bottleneck due to security, reliability or scalability issues.
4) How do they balance real-time maintenance windows with always-on service?
If a SaaS hosting provider's hardware stack is designed properly and redundant hardware is used correctly, full production availability can be maintained even during a maintenance window.
Real-time maintenance allows new features to roll out quickly since maintenance windows do not have to be scheduled and announced to customers. Developers will appreciate it because they're able to work more normal business hours, but in a real-time maintenance environment. Users like it too because their confidence in the reliability and stability of the entire application solution increases.
5) How exactly will the managed server hosting solutions keep pace with your business growth?
A significant challenge for a SaaS hosting provider is to properly size the "store." It's very important to select a hosting provider who has the infrastructure to support future growth.
For example, a company begins with dedicated servers and a managed backup server in the same data center. Then, as clients and data traffic increase, the business model will require that backup data is securely replicated offsite on a daily basis.
But if the managed server hosting provider has only one data center, how will this be achieved? Such unplanned limitations can become major roadblocks for expanding SaaS companies.
6) Do they offer professional incident management and escalation procedures?
Nothing is more frustrating as a SaaS hosting provider than getting little to no information about a service issue from the hosting provider.
The best SaaS hosting providers have a genuine and very visible culture of service that prevents this from happening to clients. Expect to see systems such as port-level network monitoring plus automated trouble ticket notification in the event of a service issue.
Any reputable SaaS hosting provider should be following clearly documented guidelines for all aspects of configuration and change management. If necessary, ask to see these documents.
The best SaaS hosting providers will also show a willingness to help with application upgrades by involving their network engineers and Sys Admin staff to minimize the impact of any service disruptions.
7) How can a business be sure that their customers' application data is securely and reliably hosted by the SaaS provider?
The Internet has given a whole new meaning to the idea of a 'data bank'. For SaaS hosting providers, it's becoming critical that a trusted business partner securely and reliably hosts their customers' data.
To some extent, managed dedicated servers hosted in an outsourced data center have now become a trusted data bank on which the SaaS business model depends.
SaaS businesses that address these 7 questions before choosing a SaaS hosting provider will increase their uptime and minimize their frustrations with their server infrastructure. This lets them focus on the highest value-add portion of the SaaS business model - the application and the users' experience.
Mike Klein is the President and Chief Operating Officer at Online Tech, a leading managed data center operator in the Midwest. Online Tech offers a full range of collocation and managed server hosting in their SAS-70 secure and reliable multi-tenant data centers across the Midwest. Visit http://www.onlinetech.com for more information.
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