The Problem With SaaS: Lack of Flexibility

I’m deep into the Wave research (read my latest status update) for nine community platforms (big list here), in fact, this week and next, I’m in 5 and a half to 6 hour meetings with vendors getting to know them very well. Of course, that’s just one side of the story, I’m interviewing up to 27 of their customers (brands) to get the ‘other’ side of the story. You’ll see me pop up online for “Twitter breaks” here and there, surfacing for air, then submerging back again.

I wasn’t surprised to hear from a few brands that not everyone is a fan of Software as a Service (Saas), in fact, for some, on-premise software makes a whole lot more sense. What exactly was the pain point with Saas?

Of course, the most obvious points continue to come to mind: conservative companies, or those with truly critical data wanted to have the data on site, or wanted to self-support their own architecture, or wanted to modify the software at their choosing, yet I learned about something that I hadn’t even considered:

Some brands felt that being tied to SaaS meant they were at the mercy of the vendor when it came to the software architecture. While this is certainly the case not just for SaaS but all non-opensource software, when a vendor would upgrade a version, some brands were forced to accept the changes. In some cases, some brands were not aware/prepared of some upcoming upgrades to the SaaS software and were blindsided to the changes.

Furthermore, these brands felt that the larger customers who wanted specific feature upgrades were able to influence the vendor through direct pressure or even fueling the R&D work through feature requests. What’s wrong with that? Alot, if the feature requests of the larger customer don’t reflect the needs of a smaller SMB customer. Since the software is delivered over the web, there was little recourse for the smaller brand to deny the changes, they pretty much had to suck it up.

Now you may ask, isn’t this a problem with all software, SaaS or on-premise? Yes but vendors are more likely to allow customers to use multiple versions of on-premise software, of course there’s a date when they will no longer support it. Yet vendors who provide SaaS are far more likely to provide only one version, forcing clients to swallow the changes on demand.

Have you had a bad experience with Software as a Service? Leave a comment, let’s explore this further.

Related reading: Community Platforms: Here comes the CIO.

Update: As usual, the conversation has also splintered into FriendFeed.