You’re reading this because you are looking for a way to digitise your processes. You want to reduce costs, get more profits, and improve efficiency and customer service.

There’s a good chance that you’ve already started using SaaS for some of these tasks like emailing, managing social media, or taking care of accounting, but have you considered how this model can help with the process of digitising?

What is SaaS?

Simply put, SaaS is a centrally located, cloud-based software delivery model that is licensed to its customers via a subscription model. The subscription model can be annual, monthly, per user, or by package level. A company is considered a SaaS company if they host their software on the cloud and license it out.

These businesses are usually based in the cloud, so they are in a unique position to constantly refine their software so customers immediately benefit. As a result, SaaS products have a much faster update and growth processes than in-house software that you must update yourself.

The benefits

Businesses that use SaaS have access to the best digital platforms as a service and can easily use cloud technology without needing to code. The model allows businesses to use the cloud as a driver of innovation rather than a way to cut IT costs. We know that business innovation is important to any company in today’s market and it’s less about managing costs.

75 percent of the more than $1 trillion of value at stake in the cloud comes from business innovation rather than from managing IT costs. McKinsey

Another great thing about SaaS is it gives you access to many different services in one place. You can connect different SaaS applications together to deliver new digital products to customers.

Boiler manufacturers, Baxi Heating, are trialing Heat as a Service (HaaS). In this model, instead of buying units of energy (kWh), consumers buy hours of warmth in their home – called ‘Warm Hours’. This re-imagining of what manufacturers have to offer has given rise to new product lines and revenue streams. It wouldn’t be possible without cloud computing. An estimated three-quarters of manufacturing are considering some sort of servitisation approach to their products.

One of the biggest benefits the SaaS model offers manufacturers is that change can happen much faster and at a much lower price-point than the hardware-based innovation that manufacturing is used to.

How to start

While there are many benefits to SaaS, it’s important to be aware that adopting the model requires a certain amount of change. Many businesses must rethink their IT mindset and have a clear idea of how they are going to adopt the model, along with serverless technologies within their IT architecture so that they don’t waste time or money. Consideration also must be given to upskill and support IT teams when restructuring to a cloud-native operating model.

Security is also a concern. Access management and the privacy of sensitive information are major considerations when using cloud and hosted services. Companies will have to rethink authentication, perimeter security, and upgrading risk assessment when moving to the cloud.

With these considerations in mind, manufacturers should look for SaaS companies tailored to their specific needs. This model has quickly become an industry standard in the face of an increasingly competitive market, where manufacturers need to adopt newer tech in order to stay competitive.

Further reading

• How to move your operations to the cloud - what you need to know, Nightingale HQ blog
• Baxi and Bristol Energy trial heat-as-a-service with an eye towards zero carbon Catapult Energy Systems
• SaaS, open source, and serverless: A winning combination to build and scale new businesses, McKinsey Digital
• The next software disruption: How vendors must adapt to a new era, McKinsey Digital
• Top 3 Reasons Manufacturers Are Embracing SaaS-based Cloud ERP, IndustryWeek