UCS Software Manufacturing (UCSSM), believed to be the first retail software 'factory' of its kind, says it is “staying abreast of, and moving ahead of” international software trends and developments, saying its software offerings will be Software-as-Service (SaaS) enabled – as this “the way the market is moving”.
UCSSM is one of a growing number of software companies who are joining a push which sees the emergence of a new trend where users will buy the use of software, rather then being locked into the perpetual software license model – which is not only more expensive in the long run, but also involves sometimes costly capital investments. Total cost of ownership (TCO) is also significantly reduced.
UCSSM is part of the JSE Securities Exchange listed UCS Group Limited.
Neels van Tonder, CEO of UCSSM, says: “The software industry is definitely changing. We are not just seeing a mega-move towards software outsourcing, a trend we intend leveraging off substantially – but we are seeing a strong move towards a new methodology which is embodied in the principles of SaaS.
"This will see consumers paying for the software they actually need, rather then having to opt for packaged commercial software, which also comes with various ongoing license fee models.”
In essence, the SaaS revolution allows companies to subscribe to software applications and outsource operating the back-end infrastructure to the SaaS vendor. The SaaS vendor can generally do this more efficiently and cost effectively, providing overall cost savings to the company
According to global IT research firm, Gartner, the annual cost to own and manage software applications can be up to four times the cost of the initial outlay. This means that companies end up spending more than 75% of their total IT budget just on maintaining and running existing systems and software infrastructure. This cost has been increasingly accepted as more and more computers have been introduced into industries and economies around the globe.
But this, it seems, is in the process of changing.
Commenting further, van Tonder says Microsoft is one of the champions of “the fast-emerging SAAF trend”.
“Microsoft, for instance, is pushing SaaS quite heavily. They might, strictly speaking, be at the experimental phase – but they are certainly making it known that they have a clear vision for it. (SaaS).”
One of the advantages of SAAF – besides a reduction in capital outlay and the provision of more freedom of choice – is that a client is offered a smorgasbord of software.
“Adopting the SaaS approach means that companies can spread their IT budget across many more applications to support and grow their business operations, which, in turn, will impact positively on the bottom-line.
“Besides the choice –and the ability to mix and match as per your needs – the vendor actually hosts the software. This signals a move back to the bygone days of computer bureaus where companies could get on with running their businesses, rather then worrying about the nitty-gritty of running their technology applications, which can be a time-consuming and costly venture.”
Besides cutting down on Capex and overall running costs, users are able to design and engineer, or opt for, the software mix that their businesses really require. Rather than running the risk of using only a fraction of the capacity and ability of the software implemented, users are now more assured of getting what they want – for less.
A user can still opt for a vanilla software solution, but he can decide, incrementally, what portions of this vanilla software the company requires, and when.
Van Tonder says the days of distributed computing – generally run over a PC-centric platform – appear to be numbered. The distributed approach was great for vendors, he said, but not necessarily good for users.
"With the distributed model companies’ IT departments were forced to spend more heavily on software and the overall IT infrastructure. But, with the advent and advance of SaaS, users are able to have more choices, and are able to sharpen their pencils to suit their IT and overall business requirements.”
Commenting on UCSSM’s drive into the outsourced software development market, van Tonder says the company had commenced a partnership with Indian-based Satyam Computer Services, one of the world's leading global consulting and IT services companies.
In terms of the partnership Satyam will be introducing UCCSM's Assemble-to-Order software solutions in India, Asia Pacific, US and Europe. Satyam's revenues exceed $1-billion and it is one of the top three Indian software companies, with offices in 52 countries around the world.
“We are looking at signing further partnerships and are, for instance, currently in the advanced stages of setting up our third international partnership.”
This partnership, still to be officially announced, will see “an offshore partner selling UCSSM’s retail-focused software solutions into the UK and Ireland, thereby spreading our global footprint".