Software As a Service (SaaS) packages abound in the cloud-based world. Touted as the solution to reducing large investments in IT infrastructure and providing the user with the ‘freedom’ of accessing a service how and when they need, the team at Ignite shares their perspective on how best to approach utilizing SaaS offerings within your business and to drive down your Cost to Serve customers (CTS).
“SaaS providers within a particular area, such as billing systems, are broadly offering the same capability. We are seeing customer organizations engage in a race to find the most cost-effective offering,” say Harj Chand, Founder and Managing Director of Ignite Data Solutions. “Just as consumers look to switch based on cost, so do organisations. Unfortunately, the data setup of most organisations makes this switch costly and prohibitive.”
You must de-couple your internal data model from your data sources
Off the back of recent client engagements, Mitch de Zylva, Senior Data Scientist at Ignite, offers some keen insights and key considerations when thinking about how to work with SaaS offerings within your business.
- SaaS packages, like billing systems are used by a lot of organizations in their growth phase. The typical method for using them is to import your data model from. This works if you stay with the same platform forever, but that is not always what an organization wants to do. What might be good in the present, may not be right for the future.
- This means that if your organization wants to change platforms, you must work out a way to consume your data out of that new platform whilst also retaining the data from your original system. This new ingestion framework is required because there are always nuances in the technologies offered by different SaaS providers.
- The cost of changing these systems will escalate and your organization gets caught in a cycle of having to move and then prepare to move again, and then prepare to move again. This costs more than money; you can end up with severe organizational fatigue as yet another ‘data transformation’ is undertaken.
- The only way to be resilient to this is for the organization to keep its own data model as a core asset for the business. Into which you can plug-and-play the data from different SaaS platforms as and when you switch.
If you want flexibility, take the time to create your data model upfront
- The data asset that your organization stores and tracks should be a model that is aligned to your business processes, under your control, and understandable by all members of your organization. This should be source agnostic. You should not see remnants of other platforms in your data model.
- Just like if your organization had a warehouse full of stock, you would devise how you stored, picked, packed, and sold your inventory – your inventory is core to your business. Your data model should be the same – you decide how you will interact with your customers, how you use your data to measure progress, implement your business strategy, and how you protect and optimize your data, not the SaaS platform.
- If you really want to be agile, you must treat your data pipelines like a physical asset – the same way you would your manufacturing equipment in a warehouse.
- It is complex and hard, but it is the source of future proofing an organization. Spend the time and intellectual effort to produce a business information model before you start to choosing SaaS platforms.
- Once you have defined your business information model, you manipulate the SaaS platform to give you the information that you need rather than the other way around. The business information model should represent the business and the market that the business operates in.
Don’t overthink it
- If you are unsure of what sort of model to use, it is easy to import a KIMBALL or INMON style. These are approaches for storing information with hallmarks like fact and dimension tables or star schema. These models enable you to strategically think about how you want to see and utilize your business data.
- Combining this with a Medallion data architecture style, will allow you to work with any technology stack. This is the sweet spot between a data warehouse and data lakes style of data structure.
Benefits of defining your business information model
- Your data is already structured in the way that you want it to work.
- You can collate history within your business model so that you do not fall into the trap of doing lengthy data mapping across multiple vendor data systems.
- Your fundamental data sets do not change, and your system is resilient to change. The technical debt for changing sits only at the point where the data sets are interacting with the SaaS platform.
- Agility combines with resiliency. This reduces the time that it takes to decide to what platform to use.
- You can implement a strategy to reduce your CTS through using different SaaS offerings, like billing platforms. Ensuring your business information is robust and resilient means that you can switch platforms fast and easily, enabling you to achieve CTS reductions faster than your competitors. You can do this because you have the safety net of your data platform that is core to your business. Because this is set up, you can plug and play with any application including core systems such as your billing platform.
- This approach helps with Mergers & Acquisitions too. It’s not just about switching platforms; it’s about merging them.
- There is always some cost to moving platforms. But this cost, and associated time to market, is significantly lower if all you have to is switch the end points for integration.
With experience across multiple billing systems such as SAP, Brave, Gentrack, Utilibill and Oracle CC&B, we are focussing on giving our clients flexibility in their SaaS choices. Our work with Utilibill and ZEN Energy shows the advantage of upfront data thinking in cutover to a brand-new billing system in two months.
The true advantage of SaaS is flexibility and not being married to one platform. Make sure your data setup allows it.