Hosted
SMB, Government and Defense Contractor Software
JAMIS Software's Hosted Accounting & Timecard
Billing Service
With our hosted service, the software is deployed
in our data center where we manage the hardware,
software and the network. Access to the software
and the database is through an Internet connection.
The 3 key reasons a company chooses hosted accounting
& timecard services vs. and install perpetual
license are;
1) Hosted services licensing is a pay-as-you-go
subscription agreement that, relative to traditional
accounting software licensing, positively impacts
your cash flow, cost of funds and financial risk.
2) The total cost of ownership (TCO) of a hosted
service-based billing and timecard software solution
will typically be less than comparable traditional
software.
3) Hosted SMB, government and defense contractor
services solutions are always deployed faster than
traditional proprietary software solutions, accelerating
the time to realize benefit. DCAA, CAR & FAS
compliance is built in and upgraded as necessary.
The Financial Impact of Hosted Accounting and Billing
Services
Perpetual licensing is the traditional way of acquiring
accounting software, where a fee is paid in one
lump sum (or perhaps spread over a few payments).
Separate fees are then paid (usually annually) for
maintenance and software upgrades. Hosted accounting
services are engaged by customers with a subscription
agreement - the service is paid for as it is used.
A significant financial benefit of subscribing to
a hosted accounting & billing service, versus
acquiring a perpetual software license, is that
a hosted service does not require a big cash outlay
to begin using the software. Other, related financial
benefits are:
• The
accounting for a hosted billing and timecard
service can be as an operational expense
over time, versus depreciating the capital
expense of a perpetual software license
over time
• The cost of funds for automation
is reduced by paying for a hosted accounting
service as it is used, versus paying a
lump sum in advance for a perpetual license
• Financial risk is less with a hosted
service accounting because customers can
stop using the hosted service, and stop
paying for it, at the end of the contract
term, as opposed to paying a lump sum
in advance for software that may turn
into “shelfware” |
The Total Cost
of Ownership (TCO) of a Hosted Service
Customers of a hosted SMB, government and defense
contractor billing service do not acquire and deploy
the software they use - the hosted service provides
all the technology and technical services required
to operate the accounting software. As a result,
there are no fees or expenses incurred to use the
software other than the hosted service subscription
fee. With a traditional, deployed software solution,
the license fee is only one portion of the cost
of using the software. The costs that are incurred
with a deployed software solution that are not incurred
with a hosted service include:
• Annual
software maintenance and upgrade charges
• Hardware to run the software (e.g.,
computers and network equipment)
• Ancillary software (e.g., database
and application servers)
• Annual maintenance on the hardware
and ancillary software
• Technical implementation consulting
fees
• Technical training for IT personnel
• Future cost for deploying upgrades
• Ongoing IT overhead |
As a result, while the total fees paid to a hosted
service may eventually exceed the license fees of
a comparable, traditional software solution, the
TCO of a hosted service will likely never exceed
the total cost of a traditional software solution.
The Deployment
of a Hosted Accounting, Timecard & Billing Service
Finally, because a hosted SMB, government or defense
contractor service has the software set-up and immediately
available to new users, the time to implement a
hosted service is dependent only on the time it
takes to configure the business billing and employee
parameters of the software to each customer's specific
requirements. For a traditional software solution,
configuring the business accounting parameters happens
only after the technology environment has been established.
As a result, the time to implement a hosted service
is typically 3 to 6 weeks, as compared to 2 to 4
months for a traditional software solution. This
not only limits costs, but also accelerates the
time to realize the benefits of using the software.
Summary
In comparing traditional SMB, government or defense
contractor billing software solutions to hosted
services, the following financial impacts of a hosted
accounting service should also be considered:
• Cost
of funds can be reduced
• Investments in software can be
accounted as operating expenses instead
of depreciable capital expenses
• Financial risk can be mitigated
• Time to benefit can be reduced |
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