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KMWorld Readers’ Special Report Poll

This article appears in the issue February 2007 [Volume 16, Issue 2]

To "buy" or to "rent"—that's the age-old question. But only recently has the dilemma applied to the deployment of many, if not most, of the business application software decisions facing managers today. We wanted to gauge the "comfort level" of KMWorld readers with this emerging trend. In a recent survey, we asked a series of questions about how willing our readers are to entrust their most important applications to a hosted or outsourced environment. We were deliberately looking for a more emotional response than a financial or practical one; we asked how readers "feel about" outsourcing, and measured their responses from "never will" to "already do," and shades in between.

The KMWorld readers' survey on "Hosted and Outsourced Applications: Would You Do It?" indicates that users are fairly willing to deploy mission-critical applications in an outsourced setting … up to a point.

Where the content of the application is sensitive, such as in financial or human resources applications, users are predictably more reluctant to lose direct local control. More than half the respondents (52%) said they "never will" or "probably won't" entrust their financial applications to an outside source. But a healthy proportion—18%—are either already doing it or working on a project to do so.

Hosted human resource applications, such as expense reports, employee evaluations, etc., were determined to be slightly more trustworthy, with 28% voting for "never will" or "probably won't," but 52% saying they would "consider it" or "definitely might" go the outsourced route. And a large number—20%—are either already doing it or currently working on a project to take HR to a hosted environment.

Somewhat surprisingly, customer relationship management (CRM) was chosen as a likely candidate for hosting … 43% say they would either "consider it" or "definitely might" deploy hosted CRM, and 17% of respondents already have hosted CRM implementations in place.

Only 10% of survey respondents insisted that they "never will" conduct their business process management applications (such as workflow and monitoring) in a hosted environment, while 61% are more comfortable with the concept—they either "might consider" or "definitely might" allow those functions to be hosted, and 11% are either in the process of converting or already subscribe to business process outsourcing (BPO).

The full results of the KMWorld readers' survey on "Hosted and Outsourced Applications" are below.

The way I feel about … hosted CRM
Never will 11%
Might consider, but probably not 20%
Would consider 24%
Definitely might 19%
Working on it now 9%
Already do 17%

The way I feel about … hosted ERP
Never will 19%
Might consider, but probably not 19%
Would consider 30%
Definitely might 15%
Working on it now 8%
Already do 9%

The way I feel about … hosted HR
Never will 10%
Might consider, but probably not 18%
Would consider 24%
Definitely might 28%
Working on it now 7%
Already do 13%

The way I feel about … hosted BPM (also called BPO)
Never will 10%
Might consider, but probably not 18%
Would consider 33%
Definitely might 28%
Working on it now 6%
Already do 5%

The way I feel about … hosted document management
Never will 17%
Might consider, but probably not 18%
Would consider 21%
Definitely might 21%
Working on it now 9%
Already do 14%

The way I feel about … hosted financials
Never will 27%
Might consider, but probably not 25%
Would consider 19%
Definitely might 11%
Working on it now 8%
Already do 10%


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