Software as a Service Explained as Only Gary Can
Getting SaaS-y . . . (it’s not what you think!)
In today’s tough economy it’s more important than ever to make it easy for consumers to find you and make a reservation – the way they want, whenever they want – online, telephone, fax or walk-in. Technology is playing a key role in changing the way businesses manage those consumer interactions. Some operators are finding that technology can significantly grow their revenue, save them time, or even save their “bacon” as I will describe later in this posting.
As technology evolves, it becomes increasingly important to keep up with the trends or run the risk of becoming disadvantaged from your competition, especially as it relates to how you attract and service your guests. Increasingly, the hospitality and other travel related industries are looking at the way technology is delivered as an opportunity to free up time, energy and resources, ultimately creating a competitive advantage. It’s really a matter of convenience and making technology work for you, rather than you working for it.
Let me explain the evolution of convenience…
When my mother was growing up, her mother baked birthday cakes for scratch . . . she started with raw ingredients, carefully added just the right amounts of sugar, flour, eggs, butter, flavoring, and mixed them, baked the cake, then put frosting on it, and presented the cake for my mother’s party! The convenience to her was not having to make the butter or gathering the eggs from the chicken house like her mother had done! When I was growing up, my mother mixed birthday cakes from Betty Crocker cake mixes, and store bought frosting mixes. The convenience to her was not having to measure the flour and sugar before adding milk and eggs and throwing it in the oven. Also she didn’t have to make the frosting by hand! When my boys were growing up, my wife never baked a cake. She went to the local grocery store, picked out the perfect cake, and the cake came to the party with her! The convenience to her was not having to get a pan dirty, not having to shop for the mixes and not taking the time to prepare it, cook it or frost it!
Today, there are party services that bring the cake to you along with party favors and even entertainment. The convenience is you pick up the phone and call, or even order online 24 hours a day. You don’t have to step foot out of your house to plan the party!
The evolution of technology software is not that much different. Convenience, access and efficiency are the influencing how software gets delivered to business owners. And newer technologies are making it even easier to access the software without making the continued investment in all the parts that make the software run smoothly. Primarily there are 3 main ways that software gets delivered to the business owner.
In the software licensing model, you have to mix all the required ingredients together and manage the outcomes: software, hardware, network connectivity, data, backups, and security are all part of making sure your business is safe and operational. Oh, and by the way . . . you have to pay annual software maintenance fees if you want to keep your software at the current version so that you can get help if you need it. In this environment, you pretty much own all the risk of making everything work together harmoniously (like when my grandma baked the cake!).
But why bother with worrying about the cost of managing the hardware and network when you could go to a service provider who takes care of the software for you (or why bother to measure all the ingredients as our mothers did when you can buy the Betty Crocker cake mix!), the Application Service Provider (ASP) houses the software in a data center, but still requires individual management of your configuration (the milk and eggs still have to be added to the cake mix, you can pay someone else to do it). And while ASP options provide efficiencies in sharing technical hardware and network resources, they still require individual and customized upgrades. Additionally, in a multi-property environment, a separate installation of software is needed for each property. ASP providers are hosting the software of legacy systems that cannot be easily re-developed without time and expensive resources. While there is an off-set of risk to the service provider, the opportunity for software scalability (or growth) and new integration is minimal.
SaaS (Software as a Service) leverages the shared software design, code, and hardware environments. With SaaS there are no installation worries, all upgrades happen automatically with instant access to the latest technology and features. So, in the “bake the cake” scenario SaaS is similar to ordering the party to come to you . . . someone else mixed the ingredients AND baked the cake . . . someone else puts on the frosting and designs…… someone else gathers up the party favors and entertainment……and someone else delivers it to you. All I have to do is pick up the phone or go online and order it! You don’t have to worry about whether the upgrades will work with your latest PC or if you have configured your computing environment to protect your data with virus controls and security access. All this is done through the total solution provided through the software service provider!
Additionally, Multi-property parks and management companies are able to manage all their parks through a single sign-on web-based dashboard. Permissions can be set to access individual parks or groups of parks, and users can be give permission to view just what they need access to, when they need it.
While some in the industry a using the term “Software as a Service”, they are really offering an ASP. That means each business is a separate installation on a central server. Each installation must be managed individually. Each installation can fall out of date if you don’t pay for upgrades. Someone has to make sure each installation is protected from a security prospective and each installation is backed up separately. It’s a lot of work and the opportunity for missed upgrades, missed security and missed backups is greater than you think.
On the other hand, Hercules is SaaS, in the true sense of the term. It is one installation of software that operates each business slightly differently according to system set-ups. The headache of having to manage multiple software license and service installations is eliminated, and updates to new features are available instantly as they are developed by the software vendor. Also, security management, credit card compliance, data management, and backup management are more reliable because they are handled collectively in one huge installation. Individual operators are given access only to their own set of data and their own software functionality, yet they benefit from the collective advancements of the entire community of users. Software as a Service has the advantage of embracing web based technologies which, by their nature, create efficiencies in the business. Business owners can easily access the system from any internet connection in the world, without having to disconnect the front office while the remote user is granted access. When one means of internet access becomes unavailable, another means such as cell phone modem cards or phone dial-up can be used to provide greater availability and redundant connectivity.
Each type software delivery model has unique strengths and weaknesses. For some parks the idea of moving to a complete web-based solution is daunting for a variety of reasons, including concerns about internet connectivity and the idea of owning a software license. For those parks a 2-way integration with locally installed software and Hercules is the ideal solution. Friend and Campground Master have partnered to offer the industry first 2-way integration this month – allowing Campground Master customers to keep their locally installed software and harness the power of the Hercules online booking engine and the Friend marketing network. This makes it easy for campgrounds using locally installed software to increase occupancy by offering 100% of their available inventory online to a broader audience, on a first-come first-serve basis through all booking channels with no concerns about double booking spaces.
Friend’s focus has been on building the industry’s first web-based front office Software as a Service (SaaS) solution – Hercules. Yet, Friend is also committed to supporting a mixture of solutions such as 2-way integration with front office software providers (such as Campground Master). These solutions provide all channels (web, phone, front office) with easily access to the same availability without the fear of double-bookings and unsatisfied guests.
Utilizing newer technologies to expand access to available inventory can enhance revenues and free up time from administrative reservation processing, allow more time to spend on increasing guest satisfaction. These benefits have been realized by John and Peggy Croce of Yosemite Pines, who recently made the switch to Hercules, making all front office inventory available to the web. The park reports that year-to-date revenues are up well over $100,000 – largely attributed to a 70% increase year-to-date online bookings. Whether the consumer books online, calls the front office or arrives without a reservation, all available inventory is now integrated, first-come first-serve through all booking channels (front-office, web site and marketplace portals), and the front office staff no longer has to spend time processing online reservations (i.e., significant time savings).
David Gorin of Holiday Cove RV Resort recently found out just how important Software as a Service can be. Recently his park experienced a catastrophic computer crash on not 1 but 3 computers, losing everything that wasn’t backed up offsite. In addition, the off-site backup was not readily available and a local installed software solution would have spelled disaster for the park. But with the Hercules system (SaaS), a workcamper pulled out their laptop and the park was back in business – not losing a single reservation or consumer record. I think David said it best – “Moral of the story: While you never expect redundant systems to fail simultaneously, they sure can and preparing for the worst case is the best case. Offsite data storage and software makes all the sense in the world.”
The way software is provided is continually changing and all options should be examined in order to make informed business decisions. The traditional delivery of software is sold as a license. The ASP (Application Service Provider) delivery option replaces the locally installed software with a central location server and licensing installation, but still requires individual installation management, including the cost of upgrading to newer versions of the software. The Software as a Service (SaaS) delivery model is an efficient web based system that enables the business owner to concentrate on core business functions while partnering with a service partner who can manage complex infrastructures, security risks and multiple distribution channels.