The Industry is currently abuzz with talk of the Cloud as more and more firms adopt hosted solutions as part of their core operational strategy. While many of us are familiar with the benefits of hosting from a daily operational standpoint, the industry
movement towards hosted third-party systems is also transforming the traditional implementation process. When compared to the implementation efforts required with traditional client-server applications, the implementations of web-based applications delivered
in a hosted environment offer some significant advantages.
At ClearStructure we began offering our portfolio management system, Sentry PM, as a fully hosted application in 2005. At that time there were much stiffer headwinds when trying to convince prospects of the benefits of a hosted solution. However, since our
initial entrance into the space we have witnessed the seismic shift in attitude towards hosted solutions that has occurred in the industry.
Since our initial hosting offering we’ve had ample opportunity to see first hand the benefits of implementing a hosted solution and why more firms are moving in this direction. While several factors are driving the adoption, decreased implementation time
and costs are core among these factors. These benefits can be attributed to two factors: (1) elimination of direct and indirect costs associated with hardware and (2) benefits made possible via new technology.
No Hardware Headaches
Typical onsite server implementations require costly hardware to purchase, install and configure. How many traditional implementations are stalled waiting for the internal hardware acquisitions process to run their course or dealing with other network issues?
Managed hosting services like those powered by Rackspace provide world-class infrastructure and dedicated servers for client environments. Inclusive hardware upgrades and disaster recovery (DR) means less IT involvement and lower risks as these services
are backed by a 100% network uptime guarantee.
Fewer Resources Required = Lower Costs
A large part of traditional implementations included sending a small army of technical and product resources onsite to help install and configure software. This included a group to help with the hardware installation and a team of people to work on requirement
gathering and system configuration. For pure web-applications, the process is much simpler. While requirements gathering and face-to-face interaction is still fundamental to a project’s success, there is no longer a need to place full time resources onsite
for months (or sometimes years!).
Traditionally the ongoing support and maintenance of software may cause more headaches than the initial implementation. Software is one of those investments where the maintenance to capital ratio can be very high. There are too many examples where users
miss out on new features and bug fixes because their firm has weighed up the benefits versus the cost and operational risks of a software upgrade; including hardware upgrades, potential conflicts with other systems and the resources to execute lengthy test
and implementation project plans. As a result upgrades are seen as something to avoid and are sometimes years in passing.
Firms that opt for this type of solution will never have to implement software upgrades, pay for maintenance or add hardware for a mission critical system again. Vendors now offer inclusive upgrades in an annual subscription fee and and will execute software
upgrades without interrupting users. The net effect is to maintain a lower total cost of ownership, allowing users to benefit from new software features that keep up with the rapid changes in the market and allow firms to stay competitive.