Clearly cloud-based software solutions are here to stay. Whether in consumer or enterprise markets, the cloud has transformed the way we deploy and consume software applications. For enterprise customers, cloud-based software radically changes the game by lowering support costs, accelerating implementation times and typically providing higher levels of service.

Within the Independent Software Vendor (ISV) community, there have been for some time the software-as-a service (SaaS) vendors and the traditional software companies. Many traditional vendors have wrestled with (or even resisted) the transition to the cloud, and the pundits continue to predict the demise of this class of ISV.

The truth is there are multiple strategies an ISV can leverage to transition to a hybrid model of SaaS. For example, Gartner outlines three cloud deployment models: cloud-hosted, cloud-optimised and the cloud-native. Each one offering distinct characteristics and unique benefits to a business.

Traditionally when people think of SaaS, they think of the cloud-native model. Cloud-native applications are built from the ground up to leverage the latest cloud infrastructures and optimise the economics of service delivery for the ISV.

This is great for those ISVs fortunate enough to build a new application from scratch, but in reality there are thousands of existing software applications that simply don’t have this luxury. This is when the cloud-hosted model becomes compelling because it gives proven enterprise-class applications the ability to leverage the unique delivery benefits of the cloud for both the customer and the ISV.

Certainly cloud-native applications have some interesting benefits, but cloud-hosted provides some unique benefits to customers as well. In some cases these advantages may even outweigh the conventional wisdom that cloud-native is the only end game. The truth is that the economics of virtualisation and low-cost computing with storage makes cloud-hosted a very viable long-term strategy.

Some of the benefits for customers of cloud-hosted include:

Combining Market-Leading Solutions with SaaS Economics

The cloud-hosted model offers the best of both worlds by combining market-leading enterprise PPM with fast implementation and the rapid time-to-value advantages of SaaS. In addition, the SaaS economic model minimises upfront and ongoing management costs providing organisations with increased flexibility to shift budgets and resources.

Deployment Flexibility that Supports Changing Business Needs

As business needs change, so do the corporation’s IT priorities. With a virtualised cloud-hosted delivery model, customers have the flexibility to move back and forth from traditional on-premise to SaaS and vice versa with relative ease. Business conditions change. Providing this option supports the potential for dynamic change in today’s global business environment and beyond.

Ultimate Configurability to Support Business Processes

Every company has unique business processes specific to the needs and requirements of the organisation. A benefit of the cloud-hosted delivery model is that software can be easily configured to align with existing business processes. By having their own virtual instance, customers are free from multi-tenancy constraints and can configure at will to support their business.

Security of your Own Instance

Through virtualisation in the cloud-hosted model, customers run the software on their own dedicated virtual machines. Although many cloud-native vendors have done a great job managing security in multi-tenant architectures, there are certain classes of customers and industry segments that highly value having their own instance.

Rapid Implementation for all Deployment Models

This is an example of the benefits of the hybrid model. Having a cloud-hosted infrastructure available provides a benefit during the implementation for on-premise customers. Implementation can begin immediately without waiting for procurement of internal IT infrastructure. This accelerates implementation. When on-premise resources are available, migrating the virtual instance to the customer site is possible.

Upgrade on your Own Terms

A cloud-hosted infrastructure allows companies to upgrade to new versions of the software when it is convenient for their organisation. This has been an enormous benefit to customers because not everyone wants to upgrade immediately every time a new software version is released. When the customer is ready, only then do they migrate. It’s a simple process; customers can manage any appropriate change impact making rollout much smoother.

You don’t survive as an independent if you don’t move faster than the big boys, embrace change and stay focused on the customer at all times. The transition to the cloud and SaaS appears daunting to some, but I can attest that the cloud is not just for highly funded startups. Leveraging a cloud-hosted model, you can deliver more value to your existing customers and transform your business model in a way that will increase shareholder value.