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Do your due diligence when switching to cloud solutions

Rhys Roberts - Wednesday, July 04, 2012

Something I have come across several times of late is small businesses who have signed up to a cloud app with less due diligence than I would have expected.  And then part way through the implementation of that solution comes the awkward "What do you mean it doesn't do X?" conversation.  Luckily on most of these occasions we've been able to work out a solution, but it made me think about one of the differences between cloud (or more accurately saas) solutions and desktop (or again more accurately, pay money up front) solutions.

My recent experience - and this applies both to my observations talking to clients and my own experience subscribing to various apps that Viridity uses internally - is that saas applications are so easy / inexpensive to get into (and out of) that users spend less time evaluating them than they would do with a system for which they are required to pay an up front fee.

In some situations this can be a perfectly sensible approach.  For example if you want to trial a "non critical" application that maybe does not hold much data you really can get in and out easily.  We have recently signed up to a Skype premium account, at a cost of $10 a month, just to see how much value we could get from the additional features (conclusion being that it is pretty good, but not sure we need the extra features - you do get a lot from Skype for free)!  The cost to us to leave this service is a few seconds on-line to downgrade the account.

At the other extreme I have seen clients implement accounting systems or CRM databases without really testing whether the app has all the features they need.  They might spend days or even weeks migrating data, training staff, customising documents, reviewing their procedures and so on, then at the last moment realise the solution does not offer some feature they regard as critical to their business.  As just one example I have a client who receives lots of payments from customers in advance of raising an invoice - their existing (mid level) accounting system handles this, Xero does not (at least not without a workaround).

The client (who was not at that stage my client I should add) had signed up to Xero, had loaded lots of data, had started invoicing clients, putting through supplier transactions and a whole bunch more besides, and then they phoned me to ask how to do enter "unapplied payments".  I had to tell them that at present they can't, that they need to use a workaround.  Luckily I was also able to tell them that this feature was going to be released by Xero very shortly.  But they were lucky (as was I, I now have a new client)!

And I have seen other examples of this, with less happy outcomes.  Had this feature not been on the way the client would have either been saddled with a system that really didn't fit their needs, or the cost and inconvenience of migrating back to their old system.

So why would such smart people - because this is a smart client, running a very impressive business - make such an elementary mistake?  It seems to me that it is a result of the low cost of entry and perceived low cost of exit from cloud solutions.  Whilst it is true that you do not have to pay up from for the software for a saas solution, a very large part of the cost of implementing some solutions - such as accounting, payroll, inventory management, point of sale and so on - is the time and effort involved in the implementation.

Maybe the only upside to this is that the same mistake is of course possible with a desktop solution (and yes I have seen it, although I think less frequently).  When a user has to pay out thousands of dollars up front for software they generally do a bit more reseach to make sure it is right for their business. 

The moral of this tale is this: even if there is no upfront cost to the software, there is a significant upfront cost to you (time, disruption, fees, etc) so it is worth reviewing any solution carefully before you make the decision to implement it.  And if you aren't sure how to do that please contact us - making good recommendations on what solutions would work for your business is one of our main areas of expertise, and we'd love to help you make a great decision.

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