According to Gartner, SaaS (software as a service) remains the largest sector of the cloud computing market and is expected to grow to $117.7 billion in 2021 (a 16 percent increase). This is pretty impressive growth, which largely has been driven by the pandemic and the need for SaaS systems to support remote work.
SaaS has long been the red-headed stepchild of the cloud computing world. Most don’t consider SaaS as part of the cloud, focusing instead on IaaS providers, including AWS, Google, and Microsoft. This is largely because the SaaS world is widely distributed, with more than 5,000 SaaS applications out there, from bail bonds management to full-blown ERP systems on demand.
Salesforce.com is certainly well known, and table stakes for most enterprises, but by doing the math you’ll quickly determine that most of the SaaS market is smaller, more tactical business systems on demand. These systems are more cost efficient than having them sit on servers in your data center.
There are some areas where enterprises can improve their use of SaaS within their larger cloud computing strategy. A few suggestions:
- Data integration. Plan out and build mechanisms for moving data in and between SaaS systems and other enterprises systems, either on-premises or within IaaS clouds.
- Security integration. Extend your larger security strategy, such as the use of IAM (identity and access management), to SaaS systems. I’m seeing a great deal of vulnerabilities in SaaS systems as security becomes an afterthought, taking a back seat to time to market.
- Process integration. We use SaaS systems because they bring prebuilt business processes that we don’t have to create in net-new applications. However, these are not optimized unless integrated with other application processes housed on-premises or in cloud-based systems. Process orchestration layers are handy here.
SaaS was really the first part of the cloud computing market that emerged in the late 90s and proved that cloud was a viable and cost-effective alternative to application ownership. That said, it’s not getting the respect it deserves, and that will get you into trouble quickly.