In we talked about why hiring potential leaders is becoming more and more important. This post reflects on the how SAAS has starting to move outsourcing vendors out of business.
Building a digital ecosystem is impossible without a strong technical team that can implement and turn useful ideas into consumable experiences. When companies didn’t possess requisite in-house talent, this started giving rise to the phenomenon of outsourcing, beginning in the early 1980s. Businesses started contracting out several functions like payroll processing, claims processing, manufacturing, facility management, customer support etc to another party in a different location and sometimes, even a different part of the world.
The internet revolution saw a boom in the growth of the outsourcing industry. Ideas could be outsourced to designers, programmers and managers, for dirt cheap prices.
Even though the outsourcing industry has flourished well in the last two decades, it is now looking at an imminent death. Their problems began with the emergence of the SAAS model.
Software as a service means that you can now get up and running in a matter of hours. Almost every practical arena of professional work has accompaining SAAS products which are standardized, work out of the box and can be customised to fit your exact needs.
Why then would a small business go to an outsourcing company to get custom solutions developed?
Outsourcing is tedious and inefficient compared to utilizing SAAS. Long development times, less than competent vendors, multiple iterations (way more than you can stomach) and tons of money later, you still won’t be fully satisfied with the end result.
Maybe part of the problem lies in the fact that outsourcing vendors are not building their own flagship products. They are more interested in short term cashflow than long term customer satisfaction. In comparison, SAAS companies are extremely interested in keeping customers happy and even upselling them to annual contracts and other sister products at the cost of short term cash flow. They actually put effort into customer happiness.
Software as a service is the future.
At GitStart, we work with some of the top SAAS companies around the globe to help them build, test and deploy at scale.