Mitigating Complexity Risk through SaaS Implementation

The assignment content discusses the risks associated with Software as a Service (SaaS) implementation in an organization. The risks can be categorized into three types: internal, infrastructure, and external risks. Internal risk is moderate and can be identified through employee responses such as surveys or face-to-face discussions. Infrastructure risk is low but difficult to identify and requires proper management planning to mitigate it. External risks are also low but pose a higher level of uncertainty due to external factors such as market trends and environmental changes.

IT Acquisition
Assessment
[DATE]
[Company name]
[Company address]

Table of Contents
Background of problem statement...................................................................................2
Why was the specific problem statement selected?.........................................................2
Reason for acquisition......................................................................................................3
Risk Analysis....................................................................................................................4
Analysis on key vendors, product trends, and market potential.......................................8
Key Vendors................................................................................................................. 8
Product Trends.............................................................................................................9
Market potential............................................................................................................9
References.....................................................................................................................10

Background of problem statement
Borger Management has different accounting systems in different department leading to
issues like gathering of information from all these platforms and then integrating it to a
single platform for creating the financial statements. It was seen that Timberline
Software was used by one person accounting the payable department and Rentroll
Software was used by accounts receivable department and the on-site property
managers. Additionally, MRI was used by Financial Statements and General Ledger.
All these software were seen to be highly incompatible with each other. This led to the
complication of the activities as the information had to be gathered from all the platforms
first, converted to the single platform and then the financial statements were created.
Therefore, the organization was facing critical issues related to increased workforce,
increased expense and less productivity. The paper discussed the concern over this
problem and analysis the risks associated with it along with a discussion on the suitable
alternative solution.
Why was the specific problem statement selected?
A disorientated system fails to integrate the accounting of the organization with their
strategic goals and cannot provide any insight to the business practice. This leads to
reduced visibility, productivity, and accountability of the business operations.
Additionally, an integrated accounting system helps in providing operational control,
limits, credit control, payment issues and invoice along with enhanced security (Robert S.
Kaplan and Robin Cooper, 1998)
The organization was facing the following challenges due to disoriented accounting
system:

1. Adaptation – The organization has to convert the general accounting solution
into specialized and integrated one. Therefore, a specialized and integrated
accounting system was required.
2. Data Entry Errors- Entering of data twice in the management provided software
and then into the integrated once increased the chances of data typing errors.
The mistakes were difficult to be recognized.
3. Decreased Revenue and productivity- Due to the same work being integrated
again, the incurred expenses were seen to be high which led to decreased
productivity.
Reason for acquisition
The organization has realized the need for improving the efficiency of the related
business processes and an integrated accounting system would be the best choice to
solve the problem. Therefore the acquisition of IT services is required in the
organization. Additionally, productivity suffers from the complication of the work. The
different accounting system increased the double key information present in multiple
systems leading to sluggish communication speed (Stiller, B., Fankhauser, G., Plattner, B. and
Weiler, N., 1998) This led to maximizing the chances of the errors and mistakes.
Therefore, there was a need for the organization to give the high level of visibility so as
to access information across an operation in real-time. The businesses are being
squeezed on to their operating margins and an improvement in the accounting system
will make a big difference for the organization.
With the acquisition of IT services the organization would be more organized, secured
and downsize during the hard economic times. The organization required a

computerized package for invoicing their accounting process to run faster in an efficient
manner. The business activities related to the accounting systems will become
seamless, automatic and fast.
Risk Analysis
The risk identified in the study are mentioned as given below:
Risk Probability of the Ease of
identification
Accurate Measurement
Organizational Risk High
-With the alternative
solution proposed the
managers, employees,
users and customers are
likely to be affected, and
the organization might take
the time to recruit qualified
individuals who can
manage the project.
-Additionally, the
employees might face
problem and issues in
training provided to them.
Yes
-As the organizational risk
is associated with the
employees, their
dissatisfaction, and
inadequate training, a
simple survey or open-
ended discussion will be
beneficial for measuring it
accurately.

-The loss of senior
management and
resistance for a change by
managers can be identified
easily.
Information Security and
Privacy Risk
Medium
This risk can be identified
with ease as it deals with
meeting all the established
standards for information
security and privacy.
Yes
-With the help of efficient
and expert IT managers in
the organization’s
management, this risk can
be identified easily.
Complexity Risk High
-The higher degree of
complexity of the proposed
solution will affect the
employees directly, and
the dissatisfaction amongst
the employees can be
seen easily.
Yes
The complexity risk can be
identified with the
responses from the
employee. Surveys,
questionnaire, face to face
discussions, etc. can be
the useful tool for
assessing the risk.

-With the higher degree of
complexity, the employees
might face problems, and
there is the higher
probability of possible
unrecognized assumptions
along with problems in
accurate forecasting costs
and benefits.
Infrastructure Risk Low
The infrastructure risks
pose low risk but it difficult
to identify. The special
demand is placed on the
infrastructure of the
organization like IT
Infrastructure.
-The non-project costs
incurred due to this risk
would not be identified
easily
- The other processes
Yes
The infrastructure risks can
be identified with the
proper management plan.
With the exceptional
execution of the
management plan, the
identification of this risk
would become easier.

might slow up leading to
confusion on the actual
risk associated with it.
- If the solution is not able
to be interoperated
suitably, it will lead to
increased cost without
identification of the risk.
External risk Low
-It is difficult to identify the
external risks as they rely
on the external
environment and are
associated with a plethora
of areas like environment,
compatibility with law,
effect on corporate
partners and stakeholders,
etc.
- Therefore, the risk leads
to increased confusion
among the employees and
No
The external risks are
beyond the control of the
organization and therefore
they are difficult to identify
and control.
These risks are therefore
difficult to foresee and
usually takes the project
managers by surprise and
confused due to the
deficient analysis of the
external threats, making
them difficult to be

the staff. analyzed.
Analysis on key vendors, product trends, and market
potential
Alternative Solution #3 (Tentative Solution Rank Order #3): Use Software as a Service
(SaaS) - Use Software as a Service (SaaS)
The organization must use Software as a Service (Saas) according to the market
analysis. The benefits of using SaaS by the organizations are mentioned below:
-Very low cost of entry as there is no need to buy hardware for hosting new application.
-Reduced time to benefit as the software application is already installed and configured.
-The vendor takes full responsibility of updating and upgrading the system and ensures
the security of the system.
-SaaS vendors can create APIs and allow their connections to ERPs/ CRMs/ other
SaaS providers.
Key Vendors
The vendors like Abiquo, AccelOps, Akamai, CloudSwitch, Eloqua, Oracle, etc. are
presenting various services like SaaS, hybrid cloud, etc. in a different and unique
manner. The organization can easily manage entire computing infrastructure along with
reporting, analyzing, etc. thereby presenting a new dynamic to the organization. Not the
vendors have to keep a watch on:
- Business Intelligence

- Supply Chain Management
- Enterprise Resource Planning
- Enterprise Content Management
- Project and Portfolio Management
- Customer Relationship Management
- Digital Content Creation
- Web Conferencing
- Enterprise Contract Management
- Office Suites
- Teaming Platforms and Social Software Suites
Product Trends
- The Complexity is seen to Increase as SaaS enters Into the Large Enterprises
- Vertical SaaS (for particular industry) vs. Horizontal SaaS (For software
category)
- Mobile SaaS available
Market potential
- SaaS Sales Will be Almost Double by the end of 2019
- SaaS Leads to the Adoption of Public Cloud
- The Traditional Applications are being replaced by the SaaS Deployments and
are Adding Net-New Applications
References
Robert S. Kaplan and Robin Cooper, 1998. Cost & Effect: Using integrated cost systems to drive
profitability and performance. Harvard Business Press.