The term ‘Everything as a Service’ has been around for some time, but the demand of value of services themselves have grown recently as organizational culture, industry best practice, technology, and cost have shifted. Whether you work in or consume software technology, there’s a good chance that the service you are providing or receiving is delivered via the ‘cloud’. But why is it that this technology trend has grown so quickly to become a new accepted standard, and how does it relate to other services like meal delivery? In this article we look to simplify the conversation of cloud and service by exploring the similarities and parallels between two distinct industry services: the value provided to the home kitchen by meal delivery service and the value provided to businesses through cloud software as a service. We will look at examples of how these services can provide better quality, safety, subject matter expertise, time savings, and cost savings as opposed to trying to accomplish the same tasks ‘in house’.

Improved Quality & Reliability

The benefit of meal delivery service around the kitchen: Utilizing a food delivery service means high quality ingredients that are fresh and free of preservatives. It also means you don’t need to worry about over buying and having food spoil in your fridge, since you are ordering a fresh, fixed portion. Preparation also means no more risk of burnt food, or of any injuries in the kitchen. There are generally no blackouts from holidays, and if you are feeling too sick or exhausted to prepare your own healthy meal, you will still be able to have one. Better ingredients, at a predictable, and reliable serving.

The benefit of cloud software as a service around the business: Cloud software providers take advantage of modern hardware with significant investments in redundancy and dedicated personal to ensure the continuity of the operations. This means software online and available to access, anytime or anywhere (access controls permitting). The risk of internal bad actors, environmental disasters, or other specific concerns for traditionally self hosted customers are reduced and up-time is significantly improved.

Improved Safety

The benefit of meal delivery service around the kitchen: Ingredients provided by food delivery services are clearly outlined, including important nutritional and allergy information. The safe ingredients are packaged fresh and fully cooked and properly preserved upon arrival. This means reduced risk of food poisoning due to contamination from improper food handling and preparation at home.

The benefit of cloud software as a service around the business: One big safety benefits is the reduced chance of cybersecurity breach, and the improved integrity of the data and information stored. Cloud software as a service providers invest heavily in multi layered defenses and backups for their systems, and hire and keep cybersecurity experts on staff. The software as a service organizations usually adhere to rigorous data handling policies, certifications, and governance that regular organizations do not.

Subject Matter Expertise

The benefit of meal delivery service around the kitchen: When you utilize a meal service, the curated menus are generally informed by dietitians and culinary chefs. They offer seasonal, great tasting recipes using ingredients that compliment each other. While you may not be a professional chef, you now have your meals prepared by those who are making their careers in the culinary arts. Your experience becomes trivial as you can rely on their years of experience and expertise.

The benefit of cloud software as a service around the business: Vendors hire specifically for individuals with experience in their field and role. Products are built by product managers that can aggregate and crowdsource learning from multiple customers. These industry experts in specific domains are developing applications to maximize your value out of the software. Industry thought leaders are creating products for you that represent solutions fit for today’s market and the pains you encounter. Vendors, self incentivized to stay competitive, stay on top of market trends, and as a result hire for new and emerging technology. The specialists they are able to maintain, e.g. researchers and experts in Artificial Intelligence, would be much more difficult and costly for smaller, individual companies to obtain.

Time Savings

The benefit of meal delivery service around the kitchen: Meal delivery service provides time savings in and out of the kitchen. Prior to cooking, you don’t need to worry about going to the store to pick up fresh ingredients. You also don’t need to invest the time to cook the ingredients themselves. Finally, cleanup is usually done via recyclable material, as there are no more pots pans, etc. that need to be washed. For those that enjoy cooking as a hobby, there are alternative meal delivery services that do provide the complete meals in uncooked form, allowing you to enjoy the cooking process.

The benefit of cloud software as a service around the business: A tremendous benefit for companies is the time to value and speed of deployment found with cloud providers. The duration to identify and setup hardware infrastructure & develop software applications, not to mention the effort to hire engineering resources takes tremendous time and effort for organizations. While organizations have specific requirements and needs, software providers include considerations for quick configurations instead of customization and development from scratch. Finally, teams internally traditionally needed to maintain, fix bugs, and upgrade code bases to adhere to security and industry requirements. These resources are no longer required as a service provides continued innovation and bug fixes via upgrades and releases.

Capital Cost Savings

The benefit of meal delivery service around the kitchen: At first, the cost of meal delivery services may appear high. Something you need to consider however is that these providers get the benefits of economies of scale, meaning the cost of ingredients is lower for them. Importantly, you do not need to make upfront investments in the cost of pots and pans and other cooking utensils. You do not need to incur the cost incurred on the travel to get and buy and ingredients, and you also don’t incur the opportunity cost of the time it takes to prepare the food.

The benefit of cloud software as a service around the business: Lower your capital expense without a tremendous increase in operating expenses by allowing the maintenance and development of software tools to remain a responsibility of your cloud vendor. You no longer need to invest capital in expensive servers and networking equipment, or acquire headcount around development and operations when looking to develop a business application for improved productivity. The re-purposing of the capital expenditure and headcount is an opportunity cost that needs to be considered. The pricing of most these vendors are also tied to expected or realized value, meaning your expected NPV and IRR on purchasing from these vendors should be positive.

While these are a just a few of the benefits, there are a few cons to consider. Going with a service means you lose a degree of control, and you will end up receiving solutions that are a best fit for the largest market. From an accounting perspective, the lack of capital expenses means you no longer have depreciation you can utilize as a tax shield. Utilization of a service also means you are incurring a dependency, so if for some reason the provider where to fail, or if their price would to increase at a renewal period, there will be a switching cost in identifying and implementing an alternative. Overall, while we believe alot of the benefits outweigh the costs, it will be up to you to decide the best route for your organization, for each project.

Curious to switch from an ‘in house’ solution to a service? Give the cost & time savings of the future a go-ahead today.

 

Have an example of a ‘X as a service’ that you are particularly fond of? Let us know in the comments below!