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I.T. Co. to Lease Out BOSS-Kadrovik

14.07.2008

I.T. Co. to Lease Out BOSS-Kadrovik
I.T. Co. offers a service which will come as a novelty for the Russian market – leasing a fully featured HRM system. It is more convenient to rent BOSS-Kadrovik as well as 2.5 times cheaper, compared to integrating it into an enterprise as per the standard model. This appears as the second such new service I. T. Co. is offering within the framework of Software-as-a-Service concept. I. T. Co. has been leasing CRM systems to small and medium enterprises since 2007.

The philosophy of working with the Software-as-a-Service (SaaS) model presumes that a certain company doesn’t buy costly software, but uses it while paying regular rental fees. By renting BOSS-Kadrovik a company can take advantage of all the functions of one of Russia’s most popular HRM systems including: personnel records, salary fund planning, keeping staff schedules and analysis of HR processes. At the same time company doesn’t need to buy licenses and waste resources on implementation and support of the system.

The rental cost of the BOSS-Kadrovik system for three workstations comes up to only 169,200 rubles per year, which is 2.5 times less than a company’s investments in its own HRM system. I. T. Co. experts came up with this data after calculating the total cost of ownership (TCO) of an HRM system installed on three work stations (normally a company staffed with up to 1000 employees automates 3 to 5 workstations for HR specialists and payroll accountants). Naturally, the TCO analysis excludes capital expenses for implementing an HRM system (procuring licenses and hardware, installation, qualified personnel selection), but is made up of annual costs for software upgrades, equipment depreciation payments and cost of IT specialists, which are oftentimes overlooked. And it’s these particular expenses: salary, benefits package, taxes, office space rent, utility bills and security calculated per one specialist, that build up the major part of the hidden costs. When calculating the TCO, it is also necessary to consider personnel-related risks: for instance, IT experts responsible for maintaining the system can simply get up and quit. Elimination of such risks is one of the advantages of switching over to the SaaS model.

Tagir Yapparov, I. T. Co.’s CEO, comments: “Software rent is attractive for aggressively developing companies, that are changing their market position and moving over to new organizational levels. Developing enterprises often find themselves in quite a problematic situation: on the one hand lack of information systems slows down development, on the other — they don’t have operating capital available that they could invest in a long-term IT project. In this case the advantages of using the SaaS model are self-evident: low deployment costs compared to the classical model, prompt system startup (several months), and minimization of failed installations risks.”

The SaaS model will be of interest for holdings whose structures are distributed over vast geographical areas, and who may find it more feasible to centralize data processing and storage at the service provider’s server. This provides maximum safety for processing and storing of information, and at the same time leads to a decrease in the IT system ownership costs.

Russian SaaS market is currently just being shaped, and only a few service providers offer rentals of corporate software packages so far. I. T. Co. entered the Software-as-a-Service market in 2007 by offering the lease of its CRM system SugarCRM Professional. Thanks to great accessibility, low cost and fast implementation, this model of CRM system use became an alternative to traditional installations for companies with limited IT budgets. CRM rental services are already being used by several small and medium business companies: production company METALLUX, Yarmarka-EDV advertising and information agency, and several others. The interest in this service is currently experiencing a steady growth, and I. T. Co. is currently at the stage of signing a number of contracts for rent of its corporate software.

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