A project team typically requires a number of tools to help them track information through the software development life cycle, from managing requirements to project plans, tasks, designing, developing, storing source code and testing. Traditionally these have been purchased and hosted onsite. But recent years have seen a dramatic shift toward using Software as a Service (SaaS), in which the tools are hosted in the cloud. Here we'll look at why this is happening, and what benefits it has for business.

Getting Benefit From Empty Seats

Buying software licenses the traditional way typically means that a set number of licenses are available for an agreement term, and these may only be adjusted upward during that time. There is no benefit for quieter times when the demand is lower. With many cloud-hosted services, the subscription is monthly or quarterly, making it much easier to adjust downward, as well as up. This removes the pressure to get the planning just right from the beginning.

Cloud-Hosted Products Allow More Agility

If an organization has standardized a particular tool and set this up to help ensure a particular level of quality, it's typical to find projects that are exceptions. For example, a new staff member might find working with an on-site tool too restrictive, particularly when they’ve had experience with something else. One tool does not necessarily fit all needs. Change is constant in the market for development tools, and with the widespread adoption of agile methodologies in the last five years, being able to switch to a tool that provides a more effective way of working can provide significant dvantages over having to adopt a standardized way of working that does not fit the style of development being used. Using cloud subscription-based products, it is possible to be up and running with a new tool within hours. (Get more tips in Don't Mess This Up: How to Implement Cloud Computing.)

Integration Is Supported in the Cloud

You might think that in moving to a remotely hosted service in the cloud, you’d have to give up the level of integration you’d come to expect from in-house hosted tools. Well, think again. Many cloud-based tools support integration. You may not be able to achieve as much integration as with purchasing a "traditional" dedicated software suite from a single supplier, but as with any set of tools, be clear on what integration you require. Determine what efficiency savings integration will bring versus the cost of operating the tools.

How to Decide: Cloud or On-Site Hosted?

The purchase of any development life cycle tool should be one based on benefits achieved from the tool weighed against the total cost, while considering whether you can accept the associated risks. When comparing cloud versus an on-site hosted tool, points to consider should include:
  • The level of integration between the tools: Greater integration may give greater efficiency savings, but also require the purchase and support of more tools.
  • Potential operational risks: By hosting in the cloud, your organization creates an operational dependency on a third party. Consider what scenarios would impact your day-to-day work and how you might mitigate these.
  • Sensitivity of data: Does the information you wish to manage contain sensitive business or personal information? Review this against your own organization’s security policies and the procedures of the cloud-based service to decide if this data can be hosted outside the organization.
  • How long is the data needed: With a subscription-based license, terminating the subscription means you will no longer have access to the service or your information stored there. Understand how terminating the service would impact you both during and after the project and determine how you could continue to operate.
  • Economies of scale: Weigh the purchase and hidden costs of hosting your own tool, versus using a cloud-based one. There may well be break-even points where the hosting your own results is cheaper than a cloud-based service. These could be used to influence your choice or as negotiation points in discussions with vendors. (Read more in How Cloud Computing Costs Can Creep Up On Unsuspecting Companies.)

When to Consider Cloud-Based Tools

Cloud-based development life cycle tools have greater benefit when a project team or organization requires a quick start and flexibility over time to adjust cost to match demand. It remains to be seen whether longer term, larger company-wide deployments will move away from in-house hosted options.

For you and your project team, the choice of tool depends on cost, operational considerations, past experience and how long it takes to be up and running. Working through the considerations above should help you understand what you need and what shapes your decision.