The wish for evergreen software ...

With the introduction of client-server technology, business software revolutionized business IT in the 1990s. Instead of mainframe computers and custom-made proprietary software, affordable standard computer technology and standard software were used for business data processing.

ERP was and is the most successful area for the implementation of business software. But the momentum for business software was considerably reduced as new areas such as CRM and e-commerce developed.

The reasons for this can be found mainly in the cost-risk-performance ratio of business software, as the software producer is only partially responsible for the economic success of installation.

The client – the business – is left alone with the responsibility for hardware, operation, support, upgrades, and further development, and many projects fail or simply lead to incalculable financial risks. Traditional ASP models failed in the attempt to counter this problem.

... has come true through e-commerce on demand

We therefore foresee two models for business software for the future – open source and software as a service (on-demand). SAAS has the potential to replace licensed business software entirely. Especially in CRM and e-commerce, analysts and visionaries anticipate that on-demand solutions will soon dominate.

We would like to give you a quick overview of the topic of “on-demand e-commerce” and introduce products, background, and trends to you.

Keeping software up to date

The release cycles of traditional software are about once a year in the best case, but sometimes considerably longer. But one of the distinguishing features of on-demand systems is that the entire system or individual components can be updated much more quickly, as the platform is operated and serviced by the software producer – thus installation is needed only once.

In the life cycle of classical software, a software release is followed by a renewed phase of analysis and planning. When all the demands for the “new” version have been determined, this is followed by the design, specification, implementation, and final test phase. A significant disadvantage of this model is immediately apparent: it is impossible to react quickly enough to changes or completely new demands. And the user (client) is not involved in the whole process, as the demands for new or modified functionality generally come from a different direction, not from the client.

On-demand systems present a completely different situation: new functions for on-demand systems are gradually and continuously added. The developers receive immediate feedback from the client on these changes and the software can be jointly developed and improved. The client gets the features that he wants and long development times are a thing of the past.

Product support

Every software has bugs, even when thorough testing ensures that the final product has no grave errors. For traditional software, various product versions exist at any given time, which all have to be supported by the producer over a certain period of time. It is immediately apparent that support and service take up a not insignificant portion of the software producer’s resources, which are then not applied to the further development of the product.

Here too, on-demand systems are different: only one version of the software exists and needs to be supported, and an error can occur only once. As soon as it is corrected, all users benefit from the improvement immediately. The expense and effort needed for support is thus greatly reduced and every reported, identified, and corrected error serves product development. As a result, on-demand systems achieve a stable and reliable status much more rapidly. For those offering on-demand solutions, customer satisfaction is one of their most basic interests.

Operating costs

On-demand software has an enormous proven potential for cutting costs, especially operating costs. Since the producer is responsible for operating his application, the customer is saved the expenses for server hardware, server administration, backups, operating system updates, etc.

On-demand systems are always operated form computer centers that offer additional advantages – high operating security, redundant broadband Internet connections, self-channeling system (on-demand computing capacity), and of course, highly specialized experts who know what they are doing. Small and mid-sized businesses would find it hard to achieve this degree of professionalism with their own employees and technology at an acceptable cost-performance ratio.

This is also the big difference between on-demand systems and the ASP (application service providing) model. There is a huge difference between just hosting standard software that was not designed for mass consumption and developing software that is especially designed for scalability, multi-user operation, and processing large amounts of data.

The advantages for the customer are obvious – the technical and administrative overhead arising from the operation of software is dispensed with completely and the company’s activity can again be focused on the actual business aspect. This represents a huge savings, especially for small and mid-sized businesses that would otherwise have to pay a lot for the know-how they need.