Application Service Providers

• Pages: 55-56

Page 55

According to the Information Technology Association of America, an application service provider (ASP) is "a company that provides a collection of IT resources to clients or subscribers who access those resources via the Internet or other networking arrangements." With the many challenges that businesses face every day, the last thing they need to worry about are a lot of technological issues that are beyond their area of expertise. Many businesses that run their own applications are forced to increase their staffs to include information technology experts who maintain and upgrade application software. Over time, this can become an expensive endeavor.

Many businesses are deciding to outsource the management of the applications to an application service provider. While cost is usually the main reason for a company to enlist the help of an ASP, other benefits include saving time, gaining access to top-tier software, and providing scalability. The speed at which advances are made in the field of computerization means that a significant investment must be made to remain knowledgeable and informed about the newest applications in the field. The cost benefit assessment of this investment for a single user is often not favorable. Quite simply, an ASP allows managers the opportunity to do what they do best and invest in acquiring knowledge about their own industry and not the computer systems industry.

An application service provider can handle many aspects of a business. ASPs manage and deliver application capabilities to multiple entities from a single data center across the private or public Internet on a rental basis. Typical of the sorts of hosted applications that ASPs offer include: enterprise resource planning applications (human resources, financials, manufacturing, supply chain management); e-commerce applications; customer relationship management packages, (sales automation, customer services and other front-office applications); productivity applications (collaboration, workflow management, project management office); and e-mail and messaging services.

Some businesses have concerns about using ASPs. Security and reliability are just two of the issues that have made businesses reluctant to turn over full control of their applications to an outside source. The ASP industry as a whole is working diligently to address these concerns and prove that their services are valid and cost efficient. Overall, their efforts...