SaaS On-Premises Pro Security, Consistency
Predictable Regular Expense Complete Control
Lower Annual Expense Con Lower Control
Higher Annual Cost Assumes Business Risk
Over the past decade, a large percentage of businesses in every sector have migrated to cloud-based systems. Tour and Attraction companies are no different, but still a contingent of companies continue to use on-premises software.
In this article we will examine the differences between the two software systems to understand common reasons why Tour and Attraction businesses run more efficiently on an all-in-one, cloud-based software.
In the case of on-premises, a business will buy hardware from their preferred provider, buy software from their Tour and Attraction software provider and the appropriate licenses to use it. In cooperation with their providers the business will install the software on the hardware and train staff.
The process is simple in theory, but can be complicated by common operational issues in practice.
When an update comes from your software provider, it is made available to your business to be installed on your hardware. Since everyone is busy and cannot afford any issues with the update, staff in charge of installing and training often put these updates off for as long as possible. This accrues a technical debt that becomes harder to ignore until updates must be installed hastily, in sequence, until the most recent version. At this point, employees will be frustrated by using an unfamiliar system and the cycle begins again.
In addition to updates, a business with data stored on-premises assumes all the business risk of security, system downtime, natural disasters and backups. When your own servers and network host all information, it requires expert staff to administer effectively. Large, publicly traded companies can see a cost savings from bringing everything in-house, hiring a great team and negotiating great rates with vendors. However, most businesses don’t have the budget for this and therefore assume greater business risks.
With on-premises software, the spending spikes when the platform needs a refresh. There is an initial outlay of capital in year one as you buy all hardware, software and licenses to get up and running. Then there is a period of minimal spending until it comes time to purchase new hardware and renew licenses.
Some businesses prefer this arrangement based on their capital structure. For instance, non-profits who must apply for grants appreciate the predictable timing of spend because they have a more difficult time justifying an ongoing higher fixed cost. Other businesses may find it difficult to budget for a large lift of expenses when a refresh is needed.
In the case of a SaaS platform, your software provider decides when to push out new updates. Generally, there will be communications through an email list or product updates forum. This aims to open the lines of communication for help with configuration and training. New features and fixes are often reported by the customer and can be implemented relatively quickly. There may be integrations with third party software companies when it is advantageous, they are simple and negotiated fully by the software team.
There is a risk that customers receive an upgrade at an inopportune time, or that the update changes the look of a certain process in a way they wouldn’t prefer. The key to mitigating this risk is great communication and customer service. The software provider can follow the feedback they receive to improve their new releases. RocketRez, for instance, has a standing software maintenance window when updates are pushed. Each software upgrade includes release notes regarding software changes. This ensures strong communication and no updates during busy season.
A major advantage of SaaS software versus on-premises is that much of the business risk is fully outsourced to your software provider. They will have dedicated staff working as experts on security and storage. The cost of dedicated security staff is now wrapped with your software cost. This avoids hiring IT staff dedicated to this function.
Some risks are outright eliminated. Natural disaster risk and the need for backing up data are fully handled in the cloud computing process.
Finally, SaaS spending is steady and predictable recurring monthly cost that sits among your operational expenses. For most companies this is a preferable arrangement until they pass a threshold where bringing software costs back in house is cheaper than continuing the usage based spend. In most cases, this threshold would be for large, publicly traded companies.
Companies that collect revenue in many different ways benefit greatly from the flexibility that a cloud-based solution can provide. In order to maximize revenue, Tours and Attractions must manage ticket purchases online and on-site, as well as gift shop sales, food and beverage, kiosk and point-of-sale purchases and a host of memberships and discounts that must be updated regularly.
With so many moving parts, the reliability and flexibility of the software that drives revenue are key to ensuring a smooth running business. By giving you the tools to brand and customize your full user journey, while taking care of updates, security, maintenance and data - SaaS software gives you the control that you want while offloading the responsibilities you don't.