According to Forbes, an estimated 163,735 businesses have closed in the United States since March 1, 2020, after a particularly difficult year and one of the most difficult in history. As a result, businesses are rapidly adapting to the adoption of cloud / SaaS technologies and are looking for new ways to successfully run their businesses:
The main priorities noted for 2021 and beyond are:
- How to evolve in the cloud
- How to stay secure and vigilant in the cloud
- How to effectively collaborate with staff and customers remotely
- Install new governance
And finally, in terms of organizational structure, many companies have – or are considering – creating teams just to focus on the risks associated with SaaS and cloud technologies.
What are the risks of adopting Cloud and SaaS?
One of the main concerns of cloud customers is the lack of access to software, the loss of data, and how they could rebuild their applications and data into a usable form if they could recover it. Specifically, the following tend to be a concern:
- Reduced operational resilience in the event of a SaaS application failure
- Lack of cloud management skills held by internal IT teams
- Risk of concentration due to generalized disturbance
- Regulatory risk in terms of compliance requirements in regulated industries
- Consumption risk for end users if their SaaS application fails
Unlike traditional on-premises software, the impact of cloud service disruption is often immediate with a sudden loss of application and data access, highlighting the need for a business continuity plan that allows rapid resumption of services.
How are organizations adopting SaaS solutions after the pandemic?
As mentioned above and in direct response to the COVID pandemic, we have observed that as companies rapidly adopt new SaaS technologies, they are also examining how they are changing their operational approach and organizational structure.
In banking and finance, for example, we’ve seen many banks create teams to focus solely on SaaS and cloud technology risks. We applaud this preventive posture to prepare for these risks and develop an emergency plan based on SaaS. Indeed, a study shows that 53% of all breakdowns can be avoided if companies take a proactive approach.
One way to proactively guard against SaaS application risk is to enter into a cloud software escrow agreement. A cloud software escrow agreement is a simple tripartite agreement with mutually agreed terms between the SaaS provider, the customer and the escrow provider. Under the terms of the agreement, the seller deposits the materials in the escrow provider’s secure vault where they are protected and can be released if required.
As summarized by Gartner in his Global Digital Market Software Outlook 2021, “Every aspect of the way software and SaaS vendors and their customers do business… has shifted to a more agile and less centralized model in the post-COVID era. These changes will not dissipate with the end of the pandemic, which means software vendors must stand up to meet the new needs and challenges of their customers. We add that part of the new SaaS needs and challenges is getting suppliers and customers to work together to ensure the secure protection of SaaS applications and data.