Running servers, maintaining software, and optimizing databases are not the first skills that come to mind when thinking of asset-intensive organizations. Their personnel are more concerned with equipment reliability, uptime, safety, and the quality and continuity of their production lines – not the fine details of how to optimize their enterprise information systems.
The original on-premises delivery of enterprise asset management (EAM) software forced customers to reach outside their sweet spot and delve into the details of managing and optimizing information systems. Soon afterward, application hosting alternatives were developed, allowing EAM customers to place greater focus on their core business objectives rather than extraneous IT tasks.
Now, the advent of cloud computing and related technology advancements has led to even more sophisticated EAM software provisioning opportunities. Two new hosting models are improving the total cost of ownership (TCO) by reducing the IT management burden, while also returning a degree of security and control to the customer.
Initial EAM delivery options were lacking
When the EAM class of software was in its infancy, the solution was usually deployed within a data center on the customer’s own property. This required significant investments in software, IT and associated support personnel, but the customer retained total control of both the environment and data in-house.
Over time, hosted deployment models emerged to lessen the customer’s upfront capital expenditures (CapEx) and ongoing software maintenance costs. The initial approach had EAM applications purchased by the customer hosted in remote data centers that were managed by the software vendor or a third party, and accessed by end users from a web browser. This option transferred responsibility for the software, technology, and security away from the customer, yet some sizeable upfront costs were still required.
The next hosting iteration, Software-as-a-Service (SaaS), reduced CapEx even further by avoiding the large, upfront software investment in addition to the IT-related costs. The EAM software is sold on a subscription basis, hosted in a data center operated by the vendor or a third party, and accessed by end users from a web browser.
However, certain downsides to the SaaS approach make it impractical for some companies. Most SaaS applications are multi-tenant environments, meaning that multiple EAM customers share the same software and rely on security mechanisms to keep their data separate from other tenants. The applications are not housed on separate virtual servers. This is a key point of concern for asset- and security-intensive organizations such as aerospace and defense, who find it problematic to operate on a shared version of software.
Furthermore, although the low entry cost for a SaaS EAM solution may be appealing, it is possible that the long-term costs of “renting” the software may be significantly higher than traditional perpetual licensing and maintenance. Also, in SaaS, the vendor controls most maintenance and upgrade decisions and timing, and any usage limitations that may be imposed. Customizations are usually not supported, and integration to other applications, especially legacy applications, can be a challenge. Nevertheless, for some companies, these characteristics are not show-stoppers and SaaS is the ideal delivery model.
Cloud-based hosted infrastructure fills the gaps
New single-tenant options for hosting EAM software in the cloud address the challenges of on-premises, traditional hosted, and multi-tenant SaaS provisioning alternatives. The two new models leverage Infrastructure-as-a-Service (IaaS) strategies:
- IaaS model: The cloud infrastructure is hosted and managed while the applications on it are self-managed.
- IaaS/SaaS model: Both the infrastructure and the applications are hosted and operated as a fully-managed cloud service.