_{________________________________________________________________________________}

       Helping Business Return to Core Competencies

The application service provider (ASP) value proposition is an attractive alternative for small to mid-size businesses because it provides top-tier enterprise applications while eliminating: 

·        Costly upfront investment in hardware and software

·        Technology implementation that is over budget and behind schedule

·        Complex maintenance and monitoring requirements

·        A fixed cost uncertainty

Enterprise resource planning (ERP) needs to reconsider how it does business.  For example, a standard ASP prepackaged IT solution for a specified number of dollars is purchased.  For an additional cost, some customization for the particular enterprise can be done. In exchange, the enterprise receives predictability and an upfront, defined IT solution at a known cost.  This permits the enterprise to focus on its core competencies rather than IT construction and maintenance.  The enterprise gains the functionality and benefits of industry-leading applications without the hassles and high costs of self implementation.

ASP Considerations 

A good ASP should offer: 

·        Flat monthly pricing for an all inclusive package

·        Pre-configured applications for faster implementation

·        Continued upgrades and maintenance

·        Integrated applications

An ASP solution positions your enterprise for growth because it has the tools the big companies use.  A networked ASP gives both the applications and network pipeline service.  Prepackaging defines and optimizes the enterprise's support with the same feel when passing data with ease.

The enhanced ASP is customer focused.  Its characteristics include: 

·        Operational support systems (OSS) built around a suite of offerings

·        Simplified service provisioning

·        Virtual private applications (VPAs)

·        Significant value/efficiencies with additional products

·        Built in customer control over the services the customer purchased

How to Evaluate an ASP 

When considering an ASP, have your enterprise evaluate the following : 

·        Is it unable to afford purchases of leading applications but wants them?

·        Is it growing fast?

·        Is there no requirement for extensive customization of applications?

·        Does it have or is it concerned about high IT staff turnover?

·        Does it have a shortage of IT skills?

·        Does it worry about technology obsolescence?

Fundamental characteristics an ASP should be able to demonstrate are: 

·        Depth of service offering.  This can range from E-mail and E-commerce to ERP and customer relations management (CRM).  The application tools required should come from one vendor.  They should be integrated so your enterprise can function as one streamlined entity.

·        Sound infrastructure.  Does the ASP have multiple sites/data centers for redundancy and disaster recovery?  Does it use a virtual private network (VPN) or point-to-point connection for security and high availability?  Does it own its own network for high application availability and proactive monitoring capabilities?  Does it have multi-levels of security and 24-7 monitoring and intervention?

·        Customer control.  Does the customer have control of applications with common interfaces/control panels for additions/deletions/changes to user profiles?  Does the ASP have reporting and data utilization for informed decision making?  Are the ASP's offerings integrated to give added efficiencies?

Some additional concerns to watch for are: 

·        Packaging.  It should be an all inclusive package that eliminates the need to sign multiple contracts with multiple vendors.  This precludes finger pointing and blaming.

·        Pricing.  Know the true cost of ownership.

·        Service level agreements (SLAs).  Understand what they include.  Consider making them ironclad and customized.

• Support.  Get one point of accountability and proactive monitoring capabilities for quick problem identification and resolution.

Written and Edited by Judy Kong, Editor TechDivas, in a report on the ICE Conference, Copyright 2000, Diva Networks, All rights reserved