In 2022, organisations worldwide were using an average of 130 SaaS applications, 16 times the number they were using in 2015. While the adoption of SaaS continues to accelerate, there is still some apprehension from businesses, especially when the SaaS applications are being used for business-critical operations.
In this blog, we look at some of the preconceived concerns that customers have towards SaaS adoption and provide some best practice advice for software vendors to counteract cloud risk.
We’ll discuss how you can provide customers with business continuity assurance and how being prepared for cloud risks can put your solution ahead of the competition.
The adoption of cloud-based applications can come with risks that businesses might not have had to consider with their legacy on-premise software, and as a SaaS vendor, it’s important to understand these concerns and how to respond to them in a way that provides your customers with the assurance they need to adopt your solutions.
Understandably, your customers will have questions about the security and continuity of their business operations and the protection of their data. Here are some of the primary concerns that we’re seeing around SaaS, and how you can help mitigate that risk.
Today, more than ever, businesses are decentralising and line-of-business units are opting to procure software independently. In fact, 4 in 10 board of directors say they’re shifting the digital business budget from a centralized function to the business units, according to Gartner research. As a result, this decentralised approach brings with it different business unit objectives, perspectives, and concerns into the decision-making process.
Here are just some of the key factors that are concerning businesses looking to adopt SaaS applications.
Data loss
With recent surveys showing that 49% of SaaS users have suffered from data loss, it isn’t surprising that this is one of the primary concerns for businesses. The leading causes of data loss are service outages (22%), followed by accidental deletion (20%), and malicious deletion (12%).
Experts warn that no organization is immune to data loss, but with the help of a third-party data protection solution, SaaS applications can be protected from common data loss scenarios, with some services offering to restore the replicated data back to the organisation. As more businesses turn to SaaS, the risk of data loss increases exponentially, and businesses are bearing this in mind during the procurement process.
Application availability
There is often a level of ambiguity as to who is responsible when it comes to ensuring the resilience of business-critical applications – the vendor or the end-user. Since your customers don’t own the intellectual property (IP) of your software, there’s an assumption that you, the vendor, will ensure that it is always available to them. And they may not realize that their existing business continuity plans don’t involve contingency options for SaaS applications.
As a reputable software vendor, it is important that you have a plan in place to ensure that your customers can get their application back up and running – if needed – so they can continue maintaining their own operations.
Regulatory compliance
Across industries, regulatory bodies are paying close attention to third-party outsourcing and the potential impact on business operations should those outsourced applications fail or become unavailable. As a result, regulations focusing specifically on outsourcing are being introduced in industries across the globe, as regulatory bodies aim to protect the integrity of markets and those businesses operating within them.
If you are selling into markets such as the financial sector, which are particularly highly-regulated for obvious reasons, there is an increasing expectation that third-party suppliers have a resilience plan in place, and in some countries this is even being mandated. So not only is it important to be able to demonstrate your risk mitigation capabilities when your customers have regulatory concerns, but it is increasingly becoming legislated.
Free Guide
Discover how Software Vendors & End-users can proactively manage Cloud Computing Risks & ensure Cloud availability with SaaS Escrow.
More and more, businesses are looking for assurance that the third-party providers they work with are able to offer them resilience for their solution. The operations and critical data that these solutions process are too valuable to not have such a policy in place. Your customers and prospective customers need to know your business is able to provide them with access to the application and their data on the chance that something might happen to your service.
To mitigate potential risks of using cloud-based software, NCC Group has developed a portfolio of SaaS escrow agreements that enable software vendors to strengthen their business continuity offering for their applications. It can be a vital selling point when you’re up against strong competition and showcases your integrity as a responsible supplier.
If you’re not familiar with software escrow agreements, these are simple and effective arrangements with mutually-agreed terms between the software customer, software supplier, and an escrow agent – such as NCC Group – designed to mitigate risk and protect the interests of all parties involved. When technology is placed into escrow, the service provider or developer is able to retain the IP rights, and the user gains the assurances that the software source code or other technology will be available if needed.
Escrow as a Service, or EaaS, is NCC Group’s escrow agreement specifically built for cloud applications. These EaaS solutions are fully scalable, and with the help of our in-house legal experts and cloud architectures our customers are able to choose the level of resilience they require.
To learn more about software escrow and how the process can work for you and your customers download our guide: Assuring your customers with resilience for cloud-based software
Need more information?
Our experts are here to help.
