The ins and outs of On-Demand

On-Demand software was expected to take the business world by storm, but is instead slowly rippling across the corporate landscape.

There’s a lot to like about the idea, particularly from the standpoint of a smaller business. On-Demand is a way to buy application functions — rather than the application itself — from a vendor.

Business employees access this software over a network through a browser or thin-client computer and use it when they need it, paying only for the time and applications they use.

Small businesses particularly like the approach since it’s often cheaper and easier to use more complex applications like customer relationship management (CRM) in this way. A small company typically can’t afford to buy and support this sort of application themselves.

But market confusion abounds — both in what On-Demand is and who the vendors are that deliver the service. There are a number of software service models that might look like On-Demand — hosting and application service provisioning (ASP), for example.

But the difference with On-Demand is “multi-tenancy.” It means that multiple customers can access the same software and applications.

An individual customer can customize or uniquely configure their own interfaces to view the On-Demand software, but they can’t make changes to the software source code. On-Demand vendors maintain these and that’s the key to rapid and economical product development, bug fixes and upgrades to the software.

On-Demand entered the market with a bang a few years ago with lots of hype and slow business adoption. It has since found a niche in CRM, content management, collaboration and e-commerce applications. Recent research suggests there’s a flood of companies wanting in the next year to ride the On-Demand wave.

Nucleus Research Inc. of Wellesley, Mass., in its recently released report — “Benchmarking: On-Demand Solutions” — observes that 64 per cent of 198 respondents to a Web survey say they plan to consider implementing an On-Demand solution in the next 12 months. Already 51 per cent of these same organizations say they use On-Demand solutions.

The appeal of On-Demand lies in ease of management and the ability of customers to rapid deploy the software, according to Rebecca

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