Software as a Service (SaaS) has changed the game for businesses and their technological stacks, allowing more freedom, technological modernity and interconnectivity than ever before. And in the remote, mobile-friendly and integrated world we live in today, this kind of subscription-based, cloud-hosted tech has become a must-have for the modern workforce.
But what if your SaaS provider were to go out of business or merge with another company? This is a real threat, particularly if you work with a smaller, less established vendor. And without the right support, your company can face some major problems, losing mission-critical data and possibly even going out of business yourself
You have to be prepared for this and all possible outcomes. That is where thorough business planning comes into play. Here is how to get it right:
Your Relationship with Your Software Vendor
Today, SaaS capabilities have become so robust that mission-critical applications – which once existed only on-premise – now often exist in the cloud. The switch makes sense: cloud deployments often offer cost savings, streamlined operations, and increased bandwidth and technological flexibility.
If you have chosen the right vendor, they will offer a significant amount of support for your SaaS solution. For more complex technology, a quality vendor will provide help with implementation, training and ongoing support. This assistance will include:
- Many forms of training, including videos, manuals and Q&A sessions
- 24/7 support and troubleshooting if you face concerns with your system
- Fixing bugs, enhancing security and providing ongoing maintenance
- Adding functionality as your business scales and your technological needs change
Your business will largely rely on this support, and they should. These perks – along with the increased freedom and technological capabilities – are some of the driving reasons why companies choose SaaS systems to begin with.
And they have made it big business: according to IBM, an estimated 85% of new software developed is being built for the cloud, and Gartner expects the global cloud services industry to grow from $182.4 billion in 2018 to $331.2 billion by 2022.
But that does not take away the fact that, unlike an on-premise system that is built and run from your own building, your SaaS solution may suddenly go away.
Why Your SaaS Vendor May Not Longer Support Your Business
The SaaS industry is thriving and in-demand, so it is unlikely that your vendor will go under – especially if you pick a well-established vendor. However, it does happen. In 2013, Nirvanix – one of the pioneers of cloud-based storage – suddenly went out business once Amazon, Google and Microsoft started to invest heavily in the cloud space. They could not compete, and customers had a mere two weeks to try to retrieve their important data. Some made it, some went under with their cloud provider.
This could happen again today. The marketplace is overcrowded, and competition is fierce. Particularly in the wake of the COVID-19 economic crisis, some companies simply do not have the resources or the demand to stay afloat.
And if they go away, so does their platform and the critical services you rely on to run your technology. This could lead to major consequences. It could:
- Disrupt your access to data in the cloud and critical applications, which in turn could stop your operations
- Interrupt your end-user operations
- Interfere with functions of your website
- Lead to lost revenue and interrupted productivity
- Cost application downtime
- Damage your brand
That said, there are steps you can take to safeguard your business-critical information and ensure disaster recovery/business continuity (DR/BC).
What to Do If Your Software Vendor Goes Out of Business
1. Be Proactive: Safeguard When Finding Your Vendor
First, it is important to face your “what if’s” head-on and plan for them before you choose a vendor. In other words, do your homework and choose a third-party partner that you can trust to protect your business information.
When considering your vendor options, start by looking into each organization’s financial health. Ask questions like How long has the vendor been in business? How large is their customer base? Who backs the vendor? Are they planning to expand? Are they running a publicly traded, established company? Generally speaking, an established business is more likely to be stable, and following this line of questioning can ultimately help you identify and sidestep potential concerns before you begin your engagement.
Once you find a financially sound vendor, look more closely into their offerings, their Service Level Agreement (SLA) and their disaster recovering plans. Specifically, look into:
- Application continuity
- Governance, risk and compliance policy
- Time to migrate to a new solution
- The amount of access you have to your data
- Policies regarding litigation and the courts
- Minimizing risk of loss
- Recovery Time Objectives and Recovery Point Objectives (RTO/RPO’s) - are they built into your SLA?
Keep in mind that even if a vendor offers a disaster recovery plan, it will only be effective if the provider is still a viable entity.
2. Protect Your Data
You can also take steps to explicitly and actively protect your data. Your vendor should have specific terms explaining what will happen to your information in the event of a bankruptcy or acquisition. If this is not the case, consider another vendor.
Also, make sure that you have unconditional access to your data at all times and that it will be available to you in a usable form even if something were to happen to the company hosting it. After all, it is your information, and you must stay in control no matter what happens on the provider’s end.
To this end, you may also consider software escrow services or employing a recovery-as-a-service (RaaS) provider. Software escrow services guarantee that your business always has access to a working version of your software, while RaaS mirrors your business’ data on a third-party server so you can always access the mirror information if the original is ever compromised.
And remember – any kind of data migration to a new software is complicated, and you could also lose important information if it is poorly executed. As you move forward with your chosen vendor and backup tools, it is important that you thoroughly think through your migration and any associated process. The more comprehensive your plan, the less likely something is to slip through the cracks.
3. Come Up with Contingency Plans
Consider safeguarding your business with a comprehensive contingency solution.
To start, you can use a separate cloud provider – either as a distinct deployment or as part of a multi-cloud architecture – to store your mission-critical data and applications. That way, if you ever encounter a problem with your primary provider, your most important information will be safe. This solution can also help safeguard against unexpected downtime should your primary provider encounter any technical difficulties.
This, of course, can complicate your data management and organization, but it can be worthwhile if you have important data that simply cannot be lost.
Alternatively, consider local backups of your most important information. Local backups can be easily accessed if something goes wrong online, and they provide a less complicated backup solution for many companies.
4. Monitor Your Site
Website and application monitoring are extremely important for any business. Proper monitoring can help you quickly identify and address:
- Performance issues like slow page load speed
- Any growing pains that arise as you scale or expand operations
- Issues with traffic, errors or user engagement
- Number of outages and impact on sales
It can also help you quickly catch any vendor concerns or SaaS performance issues, which can help you effectively address the problem and protect your data. To this end, it is important to have well-developed plan for governance. Who is responsible for your information? What are your ownership, prioritization and escalation rules? Who needs to be held accountable, consulted and informed when a problem arises?
Having this governance hierarchy established can help ensure that concerns never fly under the radar and that your business technology is always fully operable.
Planning for your SaaS provider going out of business, in many ways, is like planning for asset downtime or for any other kind of plant failure. It is the worst-case scenario that is best addressed through informed and prepared preventive action rather than reactive damage control.
After all, if you act preventatively and choose the right vendor out of the gate, it will be very unlikely that you will face these concerns. To protect your business, it is important to look for a publicly-backed, established partner with a large, reliable presence in the field. Such companies are not likely to go out of business even as the SaaS industry continues to grow and evolve, and they will protect your business from any hiccups you might face as the technological landscape continues to evolve.
And remember, there is no guarantee that your important data will be safe no matter what kind of system you deploy, so you must be prepared for each scenario and take all the necessary steps to protect your mission-critical information. The right partner will help simplify and safeguard this process for you.
Interested in more information about successfully deploying and running your software? Check out Accruent’s Complete Guide to Selecting a CMMS System.