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Survey finds SaaS failing to satisfy users

Vendors have work cut out to prove value

By CBR Staff Writer

Applications and services delivered on-demand as a software service are falling short on expectations, a sentiment survey has shown, with users left dissatisfied and IT shops planning only to maintain and not grow their level of use of SaaS in the coming couple of years.

The survey, which was conducted by Gartner in December 2008 among users and prospects of SaaS solutions in 333 enterprises in the US and the UK, found that the apparent acceptance of SaaS as a viable model has not entirely translated into satisfied users of SaaS.

One of the messages to be found in the study is that, “Vendors must reaffirm the fundamentals of the SaaS model, that SaaS solutions are lighter, simpler, more intuitive, more agile and more modest.”

The challenge they face is that apparently many customers are underwhelmed by their current experience of SaaS.

In an assessment that considered SaaS user attitudes towards a range of issues including the functionality provided, service provider responsiveness, reliability of performance, technical specifications, service reliability and support, compliance and risk management, SaaS was scored at an average of just 4.74 on a 7-point scale.

Gartner said, “Underwhelming customer satisfaction scores, hesitation over the true cost of SaaS solutions, and concerns regarding how successfully SaaS applications can be integrated with other applications all point to issues that will need addressing and resolving.”

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In an earlier analysis the company had said that the value of on-demand software sold as a service could touch the $10bn mark this year, as organisations trial application delivery choices with a smaller cost footprint than traditional on-premise options. 

Although the market is expected to show a 20% increase on 2008 levels, there are all sorts of factors that could impede adoption, however.

Some organisations take issue with the data security of SaaS services, and others have increasing concerns over scalability, or have questions about vendor longevity.

In this latest assessment of market demand, Gartner has estimated that almost 60% of organisations will maintain current levels of SaaS in the next two years, while around 30% will expand, 5% will discontinue and 5% will decrease levels of use.

People who looked but did not touch SaaS said they ruled it out because of a perceived high cost of service, due to the difficulty of integration, or because the solution did not meet technical requirements. 

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