Information Technology Reference
In-Depth Information
customized off-the-shelf software package that provides a map view of the jurisdiction.
Dispatchers can easily identify the location of patrol cars and crime scenes on the map, and
approach, Blue Cross and Blue Shield worked with Sun Microsystems to customize a claims
management system for its customers to access over the Web.
17
Another approach to obtaining a customized software package is to use an application
service provider. An
application service provider (ASP)
is a company that can provide the
software, support, and computer hardware on which to run the software from the user's
facilities over a network. Some vendors refer to the service as
on-demand software
. An ASP
can also simplify a complex corporate software package so that it is easier for the users to set
up and manage. ASPs provide contract customization of off-the-shelf software, and they
speed deployment of new applications while helping IS managers avoid implementation
headaches, reducing the need for many skilled IS staff members and decreasing project start-
up expenses. Such an approach allows companies to devote more time and resources to more
important tasks. For example, Avanax, a Silicon Valley company that develops intelligent
photonic solutions for optical networks, uses a Product Lifecycle Management system pro-
vided by SAP. The system runs on SAP servers, which has helped Avanax reduce costs and
provide much higher levels of service.
18
Using an ASP makes the most sense for relatively small, fast-growing companies with
limited IS resources. It is also a good strategy for companies that want to deploy a single,
functionally focused application quickly, such as setting up an e-commerce Web site or sup-
porting expense reporting. Contracting with an ASP might make less sense, however, for
larger companies that have major systems and their technical infrastructure already in place.
Using an ASP involves some risks—sensitive information could be compromised in a
number of ways, including unauthorized access by employees or computer hackers; the ASP
might not be able to keep its computers and network up and running as consistently as
necessary; or a disaster could disable the ASP's data center, temporarily putting an organi-
zation out of business. These are legitimate concerns that an ASP must address.
The high overhead of an ASP designing, running, managing, and supporting many cus-
tomized applications for many businesses has led to a new form of software distribution
known as software as a service.
Software as a service (SaaS)
allows businesses to subscribe to
Web-delivered business application software by paying a monthly service charge or a per-use
fee. Like ASP, SaaS providers maintain software on their own servers and provide access to
it over the Internet. SaaS usually uses a Web browser-based user interface. SaaS can reduce
expenses by sharing its running applications among many businesses. For example, Sears,
JCPenney, and Wal-Mart might use customer relationship management software provided
by a common SaaS provider. Providing one high-quality SaaS application to thousands of
businesses is much more cost-effective than custom designing software for each business.
Customer relationship management (CRM) and other general business systems are good
candidates for SaaS. For example, The Improv, “America's Original Comedy Showcase,”
turned to a SaaS CRM system from salesforce.com to manage marketing and sales of event
security as well, as described in the Ethical and Societal Issues sidebar.
application service provider
(ASP)
A company that provides software,
support, and the computer hard-
ware on which to run the software
from the user's facilities over a
network.
software as a service (SaaS)
A service that allows businesses to
subscribe to Web-delivered busi-
ness application software by paying
a monthly service charge or a per-
use fee.
