Impact of software as a service (SaaS) on software acquisition process

Abstract

Purpose Organizations worldwide are adopting software as a service (SaaS) applications, where they pay a subscription fee to gain access rather than buying the software. The extant models on software acquisition processes, several of which are based on organizational buying behavior, do not sufficiently explain how SaaS application acquisition decisions are made. This study aims to investigate the acquisition process organizations follow for SaaS software, the changes to the roles of the Chief Information Officer (CIO) and the business user and also looks at the impact of SaaS on the proliferation of unauthorized software systems. Design/methodology/approach The authors used exploratory research using the grounded theory approach based on 18 in-depth interviews conducted with respondents who have studied with enterprise software delivered on-premise and as SaaS in different roles such as sales, consulting, CIO, information technology (IT) management and product development. Findings The authors identified a need to classify the SaaS software and developed a framework that uses software specificity and its strategic importance to the organization to classify SaaS applications. The aforementioned framework is used to explain how software evaluation processes have changed for different kinds of SaaS applications. The authors also found that the CIO’s and the business users’ have changed substantially in SaaS application evaluations and found evidence to show that shadow IT will be restricted to some classes of SaaS applications. Originality/value By focusing on the changes to the roles and responsibilities of the members of the buying center, this paper provides unique insights into how the acquisition process of SaaS is different from the extant models used to explain enterprise software acquisitions. An understanding of how information search is conducted by the business users will help software vendors to target business users better.