Should all SMEs jump onto the SaaS bandwagon? Source: Shutterstock

Should all SMEs jump onto the SaaS bandwagon? Source: Shutterstock

How SMEs should evaluate and invest in SaaS solutions

SOUTHEAST Asia is a unique region. In this part of the world, more than 95 percent of domestic businesses are SMEs — be it Malaysia, Singapore, or Thailand.

According to a recent report by CPA Australia, SMEs in this region are quickly adapting to new technologies and growing their revenues as a result.

One of the most interesting choices for SMEs in Southeast Asia and across the world when digitizing is the move to SaaS-based solutions.

SaaS, or Software as a Service, is a popular choice because it provides SMEs with access to software that only large enterprises could afford previously.

However, the very benefits of SaaS-based solutions can sometimes become challenges for SMEs, especially those that are growing rapidly in headcount and geographic location.

SaaS provides transparent costing

Transparent costing is a fact when it comes to SaaS.

For SaaS-based CRMs, for example, the cost per “seat” or employee might be US$100 per month. So, if you’ve got just 10 employees, that might sound like a great deal at US$12,000 per annum.

However, if you’re a mid-sized business that is constantly growing and needs about 100 seats on average every month, you’ll be spending about US$120,000 per annum on the same offering.

When you put this in perspective and maybe forecast costs for 5 years, you realize you’re spending US$600,000 on a CRM solution.

In this case, you might decide to look for an alternative. Maybe your business could do better with a solution that you own and host on your own cloud?

Sure, security and upgrades would be a concern but subscribing to a SaaS solution doesn’t protect against those risks either.

Control and oversight of data on SaaS

When we think of an SME, we tend to think of a baker or a florist, but the reality is that a variety of businesses operate as SMEs — including manufacturers, pharmacies, healthcare institutions, and many more.

For these businesses, controlling, managing, and protecting data is a huge concern.

This is especially true in the United States, European Union, and parts of Southeast Asia, where new regulations are kicking into action.

The GDPR and the data privacy law proposed by the ex-Governor of California are most concerning given how extensively they expect data to be protected from misuse — internal and external.

Since companies tend to have less control over data on a SaaS solution as they would if they used their own on-premise or private cloud solution, it might be worth considering the risks when exploring SaaS.

Overall, there are incredible benefits to moving to a SaaS solution, but SMEs must thoroughly understand the risks and benefits before making the move.