The Top Reason to Trust a SaaS Provider With Your Data

May 24, 2018

If you’re an automotive manufacturer, what is your number one worry? What is the one thing that can undermine your reputation so badly that you lose customers? The answer is of course defective cars that at best need to be recalled, and at worst cause accidents.

Similarly, if you’re a company that provides pipeline repair services to the oil and gas industry, what is your number one worry? What is the one thing that can undermine your reputation so badly that you lose midstream oil and gas customers? The answer is a leaking pipeline that you were supposed to have fixed.

Let’s go back about nine years, when I was a product manager and performed a “mini market research” by talking to nine organizations about a new software product for chemical management that we were thinking of launching. The plan was to make the product available in two versions: SaaS and on-premise. I’ll spare you the details about the product and all the questions that were part of my survey, and focus instead of this question that I asked: “Are you comfortable with using a SaaS product and having your data stored by the software provider?”

What were the results? Four respondents said it was fine with them, and five said it was not acceptable, meaning a SaaS product was not an option for these five organizations. The results were not a surprise because I was anticipating an even split, so a 4-5 split was in line with my expectation.

Let’s fast forward to the Verdantix Green Quadrant EHS Software 2017 report that you can download for free from our website, and the following question that was asked: “When you evaluate EHS software, what is the view of the EH&S team in terms of how the software should be deployed?”

The results varied greatly based on whether respondents were considering multi-tenant SaaS or single-tenant SaaS. But two patterns are clear:

1) People are more comfortable with SaaS today than they were when I did my mini-research nine years ago.

2) There is still some resistance to SaaS. Many organizations are still reluctant to have their data stored and maintained in the cloud by a software vendor.

Keep in mind that Verdantix used a sample of 301 respondents, while I spoke to only nine people, but I think those two patterns are accurate.

Going back to my research of nine years ago, the 4-5 result to the question on SaaS was not the highlight. It was the answer by one of the four respondents comfortable with SaaS, and which I want to share because it provides a good perspective on why organizations can trust SaaS providers. The respondent told me that he trusts SaaS providers with customer data because “That’s their whole business. If something happens to the customer data, they cease to exist. The provider will care more about data security than my own company, because for them it’s everything.”

The respondent was saying that he trusts SaaS providers because they need to take data security extremely seriously, or else their reputation would suffer so badly that they would lose customers, which would possibly threaten their survival. The respondent was right.

Just like an automotive manufacturer and its number one worry being defective cars, or an oil and gas service provider and its number one worry being a pipeline that still leaks after having “fixed” it, security of customer data is the number one concern for SaaS providers, at least the serious ones. It’s not a secondary or peripheral concern. It’s not even a top priority at par with other top priorities, it is THE top priority.

This is why SaaS providers take multiple measures to ensure data security, including, but not limited to, Service Organization Control (SOC 2) Type 2 compliance, data encryption and backup, audit trails of authentications and logins, etc. It’s not just about being responsible. It’s also about ensuring their future survival as a company, which provides them a powerful motivation to make customer data security their prime concern.

Next time you’re evaluating software solutions and you have some doubts about a SaaS offering, remember that the SaaS provider is staking its survival on the protection, security and privacy of your data. There may even be a case where the SaaS provider is taking more robust measures to protect your data than your own IT department. Therefore, there is a big justification for trusting a SaaS provider with your data.

Do you want to improve EHS management in your organization through software? Download the Verdantix Green Quadrant EHS Software 2017 report to learn more about market trends and compare the top 20 EHS software suppliers:

Verdantix Green Quadrant EHS Software 2017