Reflection on the Difference Between Enterprise Software and SaaS


With the development of various SaaS products and services, it is more difficult for the enterprise software to compete with similar SaaS products in terms of feature and ease of use; The differences have been reflected and sorted out, and here are some thoughts and summaries.

1. What is SaaS

1. Definition of SaaS

The full name of SaaS is Software-as-a-Service, that is, SaaS provides services. When customers have certain specific needs, they can directly obtain services provided by the SaaS platform through the internet.

Comparing the enterprise software and SaaS, it is similar a bakery and a bread machine. The SaaS service provider is similar to the bakery, and sells the bread to the enterprise when the enterprise needs to buy bread; and the enterprise software of the enterprise is like a bread machine, no matter the enterprise use or not, it takes up a certain amount of resources. when an enterprise needs a special taste of bread, it can be made by itself with a bread machine.

2. SaaS development route

SaaS products on the market have been divided into two categories at the beginning of their development:

  • Focus on data;
  • Focus on tools and expand in the later development.

Generally, SaaS service providers that focus on data at the beginning of their development are Internet giants themselves, and they have a lot of resources. I will not talk about the development path of such SaaS products and service providers here, but only talk about the second type.

1) Vertical scenario stage: in this stage, SaaS products focus on the core use scenarios and continuously increase features to meet the use of a specific business.

2) Related scenario expansion stage: SaaS service providers in this stage will expand horizontally or vertically based on previous SaaS products. For example, SaaS service providers who previously did online form editing will expand to do online questionnaire business, or service providers who did project management software will expand to collaborative office and document management.

3) Industry solution stage: At this time, SaaS services are no longer only for one or several core scenarios and links, but more for providing industry solutions. Generally speaking, there are two manifestations: finding scenarios and building a platform.

  • Finding scenarios: At the beginning of SaaS planning, a wealth of industry data has been accumulated with data as the core. At this stage, it is more necessary to find suitable usage scenarios for the previously accumulated data.
  • Building a platform: Previously, it was mainly based on tool products serving a specific scenario, and the upward integration of tool products as a platform.

4) Re-innovation stage: At this time, SaaS service providers can choose to open the platform to establish a platform ecology, or locate new directions to develop new businesses.

3. Advantages of SaaS

SaaS service mode is similar to renting. Renting features, channels and resources when needed is an innovative software application mode. I summarize the following advantages of SaaS service for enterprises:

  • Low cost: customers only need to rent services. Compared with the traditional software sales model, they do not need to be deployed on the local server or maintained by special personnel. Especially for small enterprises, it can reduce the cost.
  • Easy to use: many SaaS products can be accessed directly through the internet without installing the client, and support a variety of devices, especially the data synchronization of many SaaS products on different devices is very excellent; And it will be updated in a relatively orderly manner, optimize the usage process and enrich features.
  • Lowering the technical threshold: SaaS service providers can provide low-threshold solutions to enable small enterprises to realize information management.

These three points are the most basic advantages of SaaS. In addition, some SaaS companies that are good at using data can also provide industry and business guidance for enterprises.

2. Why do enterprises still choose to build their own systems

Although SaaS has many advantages, large enterprises still choose to build their own systems or purchase software for local deployment, mainly for the following reasons:

Although SaaS has many advantages, large enterprises still choose to build their own systems or purchase software for local deployment, mainly for the following reasons:

  • Data security: the data of SaaS products is stored on the server of SaaS company. For large enterprises, there is a risk of data leakage, and SaaS company can also can have a deeper understanding of the actual situation of the enterprise through enterprise data; Therefore, many large enterprises choose to develop their own systems, outsource the software development, and then take over the development and maintenance, or purchase localized software deployment.
  • Special business: There are no related products on the market now, or there are special processes or requirements for the business within the enterprise, especially some processes are difficult to change during the development of the enterprise; the existing SaaS products are difficult to apply to such processes, Therefore, enterprises need targeted development.
  • Refined management: the internal management of large enterprises is more refined in terms of organizational structure, authority setting and approval process. It is necessary to achieve standardized management and clear authority; Although many SaaS systems meet the requirements in terms of business features at this stage, they have not yet reached the refinement level required by enterprises in terms of management.
  • Demand for data integration: especially for enterprises involved both online and offline, they need to integrate not only the data of different online platforms, but also the data collected offline.

The four aspects mentioned above will have different key considerations for different enterprises, but data security is basically the most important consideration, and refined management and data integration will gradually be satisfied with the improvement of SaaS services. .

3. Differences in actual operation

During my research on the enterprise softwares, I found that there are some differences between SaaS products and the enterprise softwares in terms of similar products and features; Some of these differences are caused by the particularity of enterprise business, while some are the characteristics of SaaS mode.

1. Target differences

Enterprise software and SaaS products and services are generally designed to help enterprises improve efficiency, reduce costs, increase revenue, etc.; but in actual situations, the requirements of enterprises for SaaS products are to increase revenue > reduce costs > other.

You need to see the actual effect within 1-3 months or 1-3 campaigns after using SaaS products.

The more SaaS products that can directly increase revenue, the more companies can pay for it.

Many enterprise softwares do not directly help enterprises to increase revenue and reduce costs, but more to help enterprises to standardize management, or to help enterprises to improve management efficiency through informatization. The focus is on standardized processes and clear rights and responsibilities.

2. Customer differences

The target customer of the enterprise software is only the enterprise, and it mainly focuses on the internal needs of the enterprise, especially the needs of special internal processes; its target users are clear, the usage scenarios are clear, and the process is clear, which is tailored for the enterprise.

In operation, the following situations often occur:

  • Developed for special persons: The design of some features and processes is developed for someone (the top executive of the enterprise). These features basically involve important data and processes, which are used by few people but cannot be rejected, and the confidentiality requirements are very high.
  • Development for special posts: some posts are special posts in the enterprise, and other enterprises in the industry do not have these special posts. Generally, they will involve special processes or problems left over by enterprise development.
  • Development for a certain department: Generally speaking, similar SaaS products cannot meet the actual needs of enterprises in terms of features, or the data tags and types are inconsistent with the internal standards of enterprises.

The target customers of SaaS products are a group of enterprises or a certain industry with similar characteristics. Instead of focusing on a certain enterprise, SaaS products consider common pain points and processes, and show the following characteristics:

  • Give priority to functions and business coverage: users of SaaS products are a group of enterprises with similar needs. In terms of product features, give priority to how many enterprises can solve problems and create value for how many customers.
  • Give priority to the business process itself, and then consider the internal management of the enterprise: for many SaaS products that serve specific features, unless their business is directly related to management, generally give priority to the business process itself, and then consider the organizational structure, authority design and approval process.
  • Consider customer value: although some personalized features are not the pain point of the industry and the coverage is very small, the enterprises that put forward the demand themselves have great value and can help promote products. Priority should be given.

3. Business Differences

In the same business process, the main processes of enterprise software and SaaS products are similar; However, in terms of business process, the enterprise software pays more attention to the process of the business itself in the enterprise. In addition to their own needs, enterprises using SaaS products also need to meet the constraints of SaaS products.

4. SaaS products emphasize reuse

In order to realize the reusability of features and processes in SaaS products, there are many processes in the design of business processes to realize the reusability of features.

For example, to build a SMS promotion system, the business processes of the enterprise's internal SMS promotion system and SaaS system are compared as follows:

For the enterprise itself, the most important thing is whether the SMS content itself can meet the needs of the enterprise, so the review process pays more attention to the content itself.

In the process of SaaS products, the review of whether the company name used for SMS signature is legal is added. This part is obviously a process added to allow multiple enterprises to use, which has nothing to do with the SMS business itself.

5. The enterprise software emphasizes management and control

At the beginning of the design, the enterprise software will clarify the responsibilities between positions, and the organization, authority and approval process will be pre designed, showing strong control in some business processes.

Take the company's internal H5 editing system (for headquarters, sales companies, and stores) that I was in charge of, the template editing section of the material library can set whether components are allowed to be modified and whether the page order is allowed to be changed.  only limited modifications can be made to the extent permitted by the template maker at headquarters.

However, there is no relevant design in the template editing of another SaaS product. When users use the template, they can modify it at will just like using a PPT template.

6. Feature iteration differences 

In terms of feature iteration, the enterprise software is not eager to add direct business features at the beginning of the iteration, and focuses more on improving management features such as authority and approval.

Because when authorities, approvals, and basic features are available, the enterprise software can be used within the enterprise; Feature iterations are performed according to feedback. Generally, if it is not difficult to meet the needs, business personnel will not feedback problems. This also leads to insufficient motivation to optimize the enterprise software.

At the beginning of the product iteration, SaaS products first consider adding business features, and then add and improve the management features after the business features are roughly perfect. In addition, the ease of use of the products will also be considered during the feature iteration.

The main reason is that when deciding whether to purchase services, enterprises first consider whether the features meet the business needs, and then consider whether they can meet the management needs.

4. Summary

Generally speaking, the enterprise software and SaaS products have different colors at the beginning of the project. The enterprise software often lags behind the market, and SaaS products with similar features will be basically available in the market during product planning; Although the completed business features are similar, the actual tendency is different. The internal system of the enterprise tends to meet the needs of management, while SaaS tends to meet the needs of business.

Although the enterprise software is more difficult to compete with similar SaaS products in terms of feature and ease of use, will SaaS replace the internal system of the enterprise in the future?

I don't think so, because feature and ease of use may not be the core values of the enterprise's internal system.

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