subject: Overview Of Common Enterprise Hosting Models [print this page] Has your business considered acquiring enterprise hosting services? Are you unsure whether these services will benefit your business? This article will discuss two of the most common enterprise hosting models. It will describe these services and also discuss the advantages and disadvantages of these enterprise hosting services.
Enterprise Hosting: Application Service Provider (ASP)
ASP is one of the most common enterprise hosting services. An ASP hosts and manages a single or limited number of packaged software applications located in its own or a third-party's data center. In general, an ASP provides hosting on their hardware with standard configurations or very limited customization available. An ASP is essentially a "one-to-many" provider - they use one environment to support many customers; no exceptions.
Among the advantages of working with an ASP is the experience in its software application(s), and, because of its one-to-many business model, the ASP can usually market itself as the low-cost provider of its specific services.
One disadvantage of the "one-to-many" model is either very limited or non-existent customizations. If the ASP does provide for customized environments, the pricing for it often eliminates any potential savings. Many companies are unwilling or unable to deploy "out-of-the-box" ERP software that does not take into consideration the unique requirements of their business.
An additional disadvantage is that ASPs generally offer neither skills nor experience in non-core applications and lack the ability to integrate applications. As a result, customers that do not have in-house expertise to manage integrations are forced into a multi-sourcing scenario.
A final disadvantage in working with ASPs is they often rely on third- party providers to host and manage their data centers, provide database administration, and manage networks, and other subsystems. This can result in a lack of single point of accountability for the customer when problems arise.
A vendor-hosted application provider is another common type of enterprise hosting service. This type of outsourcer sells its proprietary software application, then hosts and manages it for customers. This type of enterprise hosting service provider is generally best for applications with relatively limited functionality.
An advantage to the vendor-hosted model is that the software provider generally has a deep understanding of, and expertise in the software application. In reality, the developers within the software organization seldom manage the applications, preferring to offload this function to a separate support organization.
Moreover, designers are usually not the best users of the tools they design and build. For example, you won't find employees of Louisville Slugger on the roster of any Major League Baseball team. Can you imagine their slogan? - "Let us do the hitting for you - we designed the bats!"
In managing a customer's IT environment, knowledge of the software application or design is only a single, albeit important element in providing high service levels. Perhaps more critical is knowledge of, and experience with the IT management processes - change management, release management, configuration management, problem identification, and problem resolution, among others. Successful outsourcers will know how best to deploy these processes in the customer's IT environment.
Another disadvantage of this enterprise hosting model is that, like ASPs, vendor-hosted application providers cannot integrate their software with other enterprise applications, such as e-mail. For example, customer data and information from an ERP system may need be integrated with a Customer Relationship Management (CRM) system, and vice versa, to drive the greatest efficiency and effectiveness.These enterprise hosting providers offer no support for non-core applications and force the customer to multi-source if they lack the in-house expertise to create, manage and integrate the applications.
