Any business owner knows just how important getting the right software is for their business. Evaluating software has become more complex with the development of what seems like hundreds of different solutions such as pay as you go, on-demand, open sourced, to name but a few. Do you know your ERP from your SaaS? Does lack of CRM affect your BI?

More business owners are turning to hosted software solutions, also called on-demand solutions or software as a service (SaaS). In fact recent research has shown that 62% of business owners believe that on-demand solutions will replace licensed solutions. But why? What are the benefits of SaaS, and can they be applied to your business?

For small companies that do not have the budget for an IT technician, let alone an IT department, these solutions allow the company to outsource this part of their operation. A hosted solution can take away the need for complicated IT infrastructure as the software provider takes care of backups, hosting and upgrades.

You will no longer have to install business software and network it manually on your office computers; you access the software securely over the internet. This also means that businesses can offer flexible working conditions as employees can access the company information at home or from anywhere they have an internet connection. With this type of solution you are not just paying for the software, as with most licensed solutions, you are paying for the service. This means you will get that all important support while you use the software.

What are the disadvantages? The fact that you access your company information over the internet is cause for concern for some business owners. However, as the growth of online banking has shown, more people now trust that information can be held securely on the internet. The ‘support' aspect of SaaS is also key. If your provider does not deliver the level of support you need, you lose one of the major benefits of this type of solution. My advice is to do some research and build up a relationship with your provider to identify how easy it will be to contact them for IT support.

Another software buzzword of the moment is ‘integration'. Why is this important? Well, as your company grows usually the demand for software also rises. You have cashflow and financing, staffing, customer service, product sourcing, data management and more to worry about.

It's essential that you keep a close eye on every part of the company as it gains momentum so that you don't get caught out. It's quite possible that you already have a number of different software packages to perform different tasks within your company, perhaps an accounting system, a contact relationship management (CRM) system, online shopping cart software and a stock control package.

How about email marketing, sales and invoicing, purchase management, email, calendars and to-do lists, timesheets, sales forecasts and newsletters? Each of these systems will have their own databases (or spreadsheets) and their own requirements for data entry.

To assess the benefits of integrated software, you must evaluate whether or not these fragmented systems hinder the efficiency of your business. Do you waste time entering data such as customer addresses in more than one database? Does this double data entry lead to more errors? Is trying to keep all the different systems/databases up to date very time-consuming? If you answered yes to any of those questions, then integration should be high on your priority list.

Integrating your stock control with your accounts would mean that as you buy and sell stock, your accounting system would update automatically

It makes sense that the more your software systems talk to each other, the less time you have to spend on administration. For example, integrating your stock control with your accounts would mean that as you buy and sell stock, your accounting system would update automatically. This reduces the amount of book-keeping needed: a bonus for every business owner!

You can purchase different software packages that will integrate (to an extent) with each other, or you can purchase a single system to manage your entire business, or at least most of it. These single integrated systems are sometimes referred to as ERP (enterprise resource planning) systems. This type of solution brings us onto BI, or business intelligence.

BI refers to the improvement of business decision-making by using fact-based support system. In other words, gathering valuable up to date information on your business in order to make successful business decisions. If all your company data is held in one place, reporting becomes simple. You can compare income and expenditure for every business venture you undertake and also be able to see, at a glance, how well the business is performing.

It all comes down to the old cliché: you only get out of a system what you put in. Make sure you have the level of IT support you need but also ensure that your systems are working as hard as they can for you, leaving you to get on with what you do best: running your business.

Divene Anderson is sales and marketing manager at software solutions provider Pearl. For more information visit