We’re all familiar with the SaaS vs. on-premises debate. The internet is bursting with articles that explain the benefits and drawbacks of each model. But what does all this mean for your B2B customer portal?
More importantly, does a customer portal have any unusual requirements that give one model an advantage?
There’s no black-and-white answer here. But for manufacturers on SAP ERP, here are a few things to keep in mind.
Consider who owns the SAP integration
ERP integration doesn’t always influence a SaaS vs. on-premises decision, but in terms of B2B portals, it’s an essential consideration. We’ve spoken with too many manufacturers who’ve taken on responsibility for an on-premises B2B portal plus SAP integration. They usually come to us with a broken integration and a portal that customers won’t use.
Because the more built-out your SAP configuration is—the more it follows best practices and reflects your actual business processes—the greater the complexity of building and maintaining your own integration. Given the fact that Corevist’s prebuilt integration already works hand-in-glove with best practices in SAP, a custom integration is a bit like reinventing the wheel.
But efficient use of capital resources isn’t the only concern. In fact, it’s not the implementation that will get you. It’s the period after GoLive when on-premises solutions start giving trouble.
When you’re responsible for maintaining your integration and your B2B portal, you open yourself up to growing technical debt that’s impossible to forecast. Configuration changes in SAP will require additional work on the integration and the portal to keep everything working smoothly. We’ve seen far too many manufacturers underestimate this burden. Depending on your available resources, the issue can range from constant friction to catastrophic.
It all comes down to the resources you have for taking this level of control—and whether you actually need it.
Control is good… but only if you need it (and you can afford it)
Here’s where the contrast between SaaS and on premises comes into focus.
In an on-premises scenario, you’ll need a dedicated team to maintain that SAP integration. Not the team you already have, but people who can spend the majority of their time on it.
Don’t forget the portal itself, either. If you choose an on-premises solution, you’ll need to support and maintain the portal in house. This will require additional IT resources.
How many resources? Well, that depends on the complexity of your business as supported in the portal. But if you’ve already invested in a powerful SAP configuration that follows best practices, and you want to bring that existing value to the web, the burden can be quite high.
So, can you justify it?
Do you need full control of your portal and your SAP integration?
Scenarios in which on-premises is the only option
For some organizations, on-premises is the only possibility. We see this in markets where regulatory compliance may prohibit SaaS infrastructure. Since they’re legally required to take full ownership of their technology stack, these companies typically have the resources and staff to do so.
Outside of regulatory compliance, some organizations have internal policies that prohibit third-party hosting. In these situations, SaaS may be difficult for the company to swallow.
Other organizations may want complete control of the UX (user experience) of their software. We see this in B2C eCommerce, where a unique UX is often a competitive differentiator. We don’t see it as much in B2B portals, where customer relationships are firmly established and the investment in a custom UX isn’t justified.
Clearly, on-premises delivery has its place. However, these three reasons (regulation, internal policy, or UX control) are the only ones that really justify the added expense and responsibility.
Scenarios in which SaaS makes more sense
Outside the above situations, SaaS is usually a better business choice. Here are a few scenarios where the heavy lifting of on-premises is hard to justify.
- Retiring phone, fax, and email interaction is your primary goal. If you’re new to customer self-service, SaaS empowers you to solve this problem quickly without reinventing the wheel.
- A frustrating customer experience is the primary business driver. When customers need to interact with their SAP data, an out-of-the-box SaaS solution empowers you to move fast (and pivot fast) in solving customer experience problems.
- You don’t have the IT staff to run your customer portal (or your SAP integration), and you can’t hire. In this situation, a SaaS solution that includes integration is a no-brainer.
Why SaaS for these scenarios?
- You don’t have to make capital investments for infrastructure because the SaaS provider already has the infrastructure.
- You can spin up new instances quickly. This is especially beneficial on the Corevist platform, as you can reuse your existing investment in Corevist’s SAP integration architecture for additional B2B portals.
- Costs are easier to forecast because they’re spelled out in your contract.
- Implementation cost is lower because the SaaS provider is just provisioning an instance of the existing software for you, on their existing infrastructure.
- Implementations go much faster because the SaaS provider has already solved all the big, basic problems (and you don’t have to reinvent the wheel).
- You won’t create as much new work (or, possibly, any new work) for your IT staff.
- The SaaS provider handles security. In the case of Corevist, which integrates directly to SAP without middleware, you don’t take on any additional security or GDPR responsibility because Corevist doesn’t store any transactional data.
- Upgrades generally don’t require new implementations. SaaS providers typically roll out continuous upgrades automatically.
Since SaaS solutions are hosted and maintained by a third party, they remove the burden of heavy technological responsibility. This allows your organization to focus on its core competencies—the reason you’re in business in the first place.
The takeaway: Choose the model that makes the most business sense
In a nutshell, on-premises software gives you more control (and forces you to take on more responsibility). In today’s software market, the benefits of this model outweigh the costs only if regulation, corporate policies, or the need to control UX are pushing you in this direction.
In all other cases, SaaS solutions offer a lower total cost of ownership and greater flexibility. This empowers you to pivot faster to market changes without undertaking monumental upgrade projects or new staffing requirements.