 |
Important considerations under this
model are similar to the issues and concerns you would
have with any outsourcing arrangement:
- You want to make sure the application implementation
meets the needs of your business.
- The support expertise of the service provider must
exceed the expectations of the users.
- Data center management must be better than your
own data center.
- The ASP must provide an acceptable level of security
and performance.
- The costs of the service must be reasonable. When
you evaluate the economics of the BOL model, compare
the monthly charge per user of the BOL system to the
initial investment in software, hardware, support,
implementation services, and the continuing costs
of operating your own systems. If you have 100 users
at a monthly subscription cost of $5OO/user, your
BOL costs might be $5O,OOO/month and might groow or
shrink proportionately as your business changes.
Compare that monthly charge with a $2 million up-front
investment in hardware, software, and consulting,
and add annual direct operating costs of $300,000+
for system administrator, support, and data center
costs. Typically you must sign a multiyear deal for
the BOL services, but you would pay by the month.
|
|
|
