Internet vs. Enterprise Workforce Solutions

Definition of ASP's

The ASP (Applications Service Provider) is a relatively new software architecture, having become viable only since the late eighties, with the widespread availability of high speed internet access. An ASP is a third party entity that deploys, hosts and manages access to a packaged application and delivers software-based services and solutions to customers across a wide area network from a central data center.

Applications are delivered over networks on a subscription or rental basis. In essence, ASPs are a way for companies to outsource some or almost all aspects of their information technology needs. ASPnews.com breaks the industry into five subcategories:

Enterprise ASPs: Deliver high-end business applications, such as turnkey CRM applications.
Local/Regional ASPs: Supply wide variety of application services for smaller businesses in a local area.
Specialist ASPs: Provide applications for a specific need, such as Web site services, wireless communications or human resources.
Vertical Market ASPs: Provide support to a specific industry such as healthcare, transportation, etc.
Volume Business ASPs: Supply general small/medium-sized businesses with prepackaged application services in volume.

Perhaps one of the best and most easily understood comparisons between an ASP and an installed Desktop application would be readily available virus scanning software, now running on most everyone's PC.

Only a few years ago, the only choice for PC virus protection came in the form of a disk or CD that each user would purchase outright, then load onto his or her computer. Whether being installed as a Desktop Application on a single PC for home use or as an Enterprise Application for use on multiple PC's on a business PC network, the end user was primarily responsible for installing, maintaining and upgrading the software.

Today, there is another choice that is becoming rapidly popular, whereby an individual or business can purchase virus scanning software in an ASP format. In this case, the application is not purchased outright, but "rented" on a subscription basis for a period of time. By providing a centrally hosted internet application, the service provider takes primary responsibility for managing the software application on their centralized infrastructure, using the internet as the conduit between each customer and the primary software application. The ASP instructs each customer's PC when an upgrade is required, simplifying and automating maintenance of the software for the customer.

Located in Sunnyvale, CA, McAfee.com is the world's leading security Application Service Provider (ASP), with over 1.5 million paid subscribers from over 200 countries worldwide. By hosting Web-based applications for PC users, the company has virtually eliminated the need to install, configure and manage security technology on a local PC or network.

Benefits of the ASP Model

As a growing number of companies discover every day, working with an application service provider (ASP) offers a number of valuable business benefits. These benefits include:

Continuous access to the latest technology you need to run your business
Improved ability to focus resources on core business issues, rather than IT concerns
Faster implementation of new applications and technologies
Easy application scalability
Access to comprehensive security, back-up, disaster recovery and support services
Preservation of existing investments in legacy computers
Reduced total cost of IT ownership
Greater predictability of IT costs
Increased IT flexibility
Preservation of capital
Simple, low cost implementation of multi-location applications
Benefit from ongoing improvements that are added to attract new users
No software support fees

Perhaps one of its biggest benefits of an ASP is that much of the fear factor is eliminated for service companies wishing to acquire a new workforce solution. Purchasing an expensive Enterprise application can be an intimidating decision for business owners, for fear of making the wrong selection. Most ASP's offer a trial period or short-term contract period in which the service company could test drive the product. The field trial also has the side benefit of testing how your staff will respond to the changes in work process. At the same time, they feel like they are involved in the selection process. Empowerment can go a long way towards a smooth implementation...

Many service organizations, particularly those with fewer than 100 vehicles, do not have in-house IT capability. The operation of their internal PC network must be contracted out to a third party company, on which they depend to keep things going. Often, they are at the mercy of such a company and when things go wrong, they must contend for their attention and service. With the pure (web native) ASP model, there is no need for a dedicated IT department and contracted IT services are likely not even necessary. All that is required is a simple LAN with Internet access, sitting behind an inexpensive firewall.

A major advantage of the ASP solution is that typically, there is no capital investment required. In fact, many ASP's even dispense with the credit check, as they can simply suspend access for delinquent accounts. These benefits makes the ASP very appealing to cash starved or startup service companies who want all the same advantages in automation as their larger, established competitors.

For larger organizations, the ASP can mean bypassing lengthy, cumbersome budgeting exercises, instead passing the monthly costs through an operating budget. For geographically dispersed organizations, the ASP greatly simplifies implementation and significantly lowers IT costs. Companies wishing to operate on a centralized database have no need to deploy high power servers for Citrix or Terminal Server architectures. Essentially, the ASP takes geography right out of the equation. Even out of date desktop PC's in remote locations can enjoy reliable access.

There is no doubt that ASP solutions have become viable alternatives to many Enterprise or Client/Server applications.

Benefits of the Enterprise Model

Once purchased, you own the software, can be accounted as a depreciating asset
Runs faster typically than an ASP
Operates independent of Internet connectivity
Generally, provides richer desktop experience
Data is kept in-house
More user-configurability

The single biggest advantage for Enterprise applications over the ASP model is their ability to run completely independently of having Internet connectivity. Imagine a large service organization, someone on the scale of a Sears for example, that depended on having Internet access for basic functionality, such as order entry. Imagine the chaos if the Internet went down, preventing an entire Sears store or catalogue center from entering customer orders!

This is the obstacle that prevents many larger companies from adopting a web native ASP model as a turnkey solution. Until the Internet provides the same reliability as your business phone system, the Enterprise system will remain a staple of large business solutions.

The other major sticking point for Enterprise systems, again more specifically for larger organizations, is the security aspect of having all data kept in-house. For government organizations, public companies and large corporations, there is always the concern of having their data stored on a third party server.

Enterprise applications utilize the significant processing power of the desktop PC or client machine to provide fast operation, a rich user experience and the local configurability of Win32 applications.

Hybrid Applications - Combining the Benefits

The landscape is changing quickly, as the ASP and Enterprise models each morph into new hybrid models that combine the benefits of both architectures. The enabling technology behind this transformation is a new global standard called Web Services.

Web services are the fundamental building blocks in the move to distributed computing on the Internet. Web Services are becoming the platform for application integration. Applications are constructed using multiple XML Web services from various sources that work together regardless of where they reside or how they were implemented.

Web services are a new breed of Web application. They are self-contained, self-describing, modular applications that can be published, located, and invoked across the Web. Web services perform functions, which can be anything from simple requests to complicated business processes...Once a Web service is deployed, other applications (and other Web services) can discover and invoke the deployed service.

Exposing existing applications as XML Web services will allow users to build new, more powerful applications that use XML Web services as building blocks. For example, a user might develop a purchasing application to automatically obtain price information from a variety of vendors, allow the user to select a vendor, submit the order and then track the shipment until it is received. The vendor application, in addition to exposing its services on the Web, might in turn use XML Web services to check the customer's credit, charge the customer's account and set up the shipment with a shipping company.

What this means is that traditional Enterprise applications can be easily integrated to an ASP in order to gain certain functionality. For example, Fleet.NET is a hybrid application that combines a hosted gps tracking database and communications service with a client application that resides on each PC. This provides the benefits of the fast graphics performance of locally installed maps with the utility of central database storage and centralized system management. Client updates can be automatically deployed via the hosted architecture, ensuring that all customers systems are always up-to-date.

Hybrid applications, using Web Services as connectivity points, can combine the benefits of both the Enterprise and ASP software architectures. The users gets the core functionality to run their business from an Enterprise application, then uses specific specialty ASP modules, such as dispatch, mapping and payment processing to provide a turnkey business solution.

Web Services is permanently changing the concept of software development and deployment. Traditionally, software developers within the service industry have specialized knowledge within a particular vertical market. Yet, in the quest to meet their customers' needs for a turnkey solution, they develop modules outside of their core knowledge area. For example, a company specializing in Taxi software incorporates accounting software, which is really a completely different specialty. With Web Services, the Taxi company will be able to purchase the Taxi solution from one vendor, the accounting solution from a second specialized vendor and they will be seamlessly integrated through a Web Services interface.

Comparing the True Cost of Ownership

If your organization intends to implement a workforce solution or augment an existing software application with additional services such as dispatch or vehicle location, it is important that the alternatives are considered and compared realistically.

The first step is to create a requirements document that lists your corporate and operational objectives, the expected return on investment if those objectives are achieved and the core functionality that is required. The requirements document should incorporate a matrix that allows the basic functionality components of each considered alternative to be ranked for compliance with your needs.

Next, suitable applications and vendors should be sought through industry peers, publications and Internet queries. Applications should be ranked against each other, using the matrix created. Remember that flexibility, scalability, support, training and open architecture access are critical characteristics that should also be ranked.

If applications or components of the application are available in an ASP format, use a chart like the one below to complete a true cost of ownership. All costs should be brought back to present value (PV) using a financial calculator for an accurate comparison.

Software Items

	Enterprise Costs	ASP Costs
Software Licenses	$	$
Operating System Licenses (e.g Windows Server, Windows Vista)	$	$
Mapping Software Licenses	$	$
Service License Fees (e.g. MS SQL Server)	$	$

Hardware Items

	Enterprise Costs	ASP Costs
Server Hardware	$	$
Radio System Base Station Hardware	$	$
Mobile Data Terminal/Handsets	$	$
Mobile Radio/Data Modem Hardware	$	$
Mobile Device Accessories (i.e. Mounts)	$	$
Mobile Device Peripherals	$	$

Implementation Costs

	Enterprise Costs	ASP Costs
System Installation	$	$
Mobile Device Installation	$	$
Mobile Device Setup, Programming	$	$
Training Costs	$	$

Operating Costs

	Enterprise Costs	ASP Costs
Radio System Licensing Costs	$	$
Radio System Maintenance Costs	$	$
Radio System Site Rental Charges	$	$
Radio System Remove Private Line Charges	$	$
Handset/Device Licensing Costs	$	$
Voice/Data Airtime Charges	$	$
In-House IT Labor Costs	$	$
Contracted IT Labor Costs	$	$

Total Costs

	$	$