Ads by TechWords

See your link here
Receive the latest technology news and information.
IT Management
Computerworld Daily News (First Look and Wrap-Up)
Computerworld Blogs Newsletter
The Weekly Top 10
Cloud Computing
View all newsletters




Privacy Policy
 

Top 10 SaaS Traps: Watch Out For Hidden Snags

June 12, 2006 12:00 PM ET

3) Missing SLAs. Service-level agreements, such as those guaranteeing vendor response time, are a critical component of SaaS contracts, says Mankowski. Some vendors provide SLAs with the contract, while others charge extra fees for SLAs or don't provide them at all, he says. "If it's a business-critical application and you need five 9s uptime, you need to make sure that's covered in the agreement with your SaaS provider," Mankowski says. Also, contracts should stipulate penalties such as credits or givebacks if service levels aren't met, says Jeff Kaplan, managing director at ThinkStrategies Inc., a consulting firm in Wellesley, Mass.

4) Performance levels. Customers should clearly define software uptime and availability levels with SaaS providers in writing. Before entering into an agreement with a SaaS provider, customers should ask the vendor for a record of past performance levels, says Kaplan. It's also wise to ask about business plans and investments that the provider is planning to make over the next three to 12 months, including enhancements to service-delivery capabilities, says Kaplan.

Customers should also ask how they will be contacted if there's a service disruption, and they should find out how much time the vendor has to fix the problem under the contract, says Mankowski.

5) Defining uptime. SaaS customers need to carefully define guarantees around system uptime, says DeSisto. Most contracts call for 99.5% uptime or part of your money back for a month. "But what does that mean?" asks DeSisto. "Is that 99.5% of planned uptime? Does the vendor plan to be down eight hours a month? If so, which hours?"

6) Add-on costs. SaaS customers should scour the fine print for hidden expenses. Sometimes vendors charge to configure the software or implement the database or workflow processes, says DeSisto. In some cases, vendors charge an additional $18 to $25 per user per month to stage and test the software, he says. And if you want to add support for handhelds and other mobile devices, those costs can escalate to $45 per user per month.

Vendors also may try to predetermine the amount of storage that's available for each end user in your organization and bill for overage charges. "So many people are buying SaaS based on price. They need to understand what the base product is and how much all the add-ons cost," says Rob Scott, managing partner at Scott & Scott LLP, a Dallas-based law firm.

Customers should also ask whether training is "baked into" the cost of the service or if there are additional costs for training or support, says Mankowski.



Jump to comments

SaaS agreements

Additional Resources

EFD vs. HDD - What You Need to Know
WHITE PAPER
Enterprise flash drives provide a new Tier 0 storage layer capable of delivering high I/O performance at a very low latency. Proper use of EFDs in an Oracle environment can deliver increased performance compared to fibre channel drives. Read the recommendations for identification of the best DB components for EFDs.
Gartner Research Report: Magic Quadrant for Application Delivery Controllers, 2009
WHITE PAPER
The market for products to improve the delivery of application software over networks remains dynamic and innovative. Vendors focused on solving enterprises' most-pressing application problems have become the top players.
Eight Criteria for Server Load Balancing
WHITE PAPER
Server load balancers are a simple yet highly effective means to scale an application environment while ensuring its availability. Today's solutions should also address application performance and security. Read about the top eight criteria you should consider when choosing a server load balancer and how Citrix NetScaler meets those requirements.

What People Are Saying

White Papers & Webcasts

The Workday User Experience Video
Watch Workday's Creative Director, Scott Lietzke, discuss the business-centered design philosophy at Workday.

Business Process Framework Demo
Learn about Configurable Business Processes and Calculated Fields. Watch Now!

Manager Experience Demo
Go beyond self-service solutions to perform more effectively. Watch Now.

Faster, Cheaper and Easier to Maintain
Can you afford not to upgrade your servers to today's advanced, energy-efficient technologies?  


IT Jobs