Business realize Essay Example
Business realize Essay Example

Business realize Essay Example

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  • Pages: 3 (820 words)
  • Published: September 1, 2018
  • Type: Case Study
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At the end of the 20th century, businesses discovered that ASPs were not as beneficial as previously thought after the burst of the Internet bubble. The downfall of major ASP companies and its impact on customers made it clear that outsourcing to an ASP could put a company's survival at risk if the ASP were to collapse. Predictions from AMR research in 2000 estimated that 40% of ASPs and 60% of the wider market would either fail or merge with another company [Frye, 2001]. After Red Gorilla and Pandesic, two major ASPs collapsed, concerns over data safety and potential consequences for customers grew [Factor, 2001]. Customers became increasingly interested in the sustainability of their ASPs and it became evident that ASPs offering too many applications were more likely to fail due to excessive spending.

ASPs gained popularity as an offshoot of major

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software developers like IBM and Microsoft. Customers and ISPs initially projected a high return on investment, but now analysts estimate that ASP services are cost-neutral over time. According to Frye in 2001, although ASPs are as expensive as implementing the technology oneself, they provide access to new technology quickly and can hold someone accountable. ASPs offer services in all business and service sectors. Websites connecting potential customers with ASPs present a list of industries or businesses. As customers become more aware of the pros and cons of outsourcing their IT needs, they are more cautious in selecting an ASP.

ASP services are a cost-effective option for medium to small companies and can add value to their business at a reasonable start-up cost. Even large corporations with advanced IT systems may find ASPs attractive for specifi

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applications within certain departments, due to lower initial costs [Factor, 2001]. It is important to note that ASPs may handle proprietary or sensitive data.

Ensuring data security and safeguarding it against malicious individuals, such as hackers or disgruntled employees, has been a significant challenge for numerous companies. As the healthcare sector increasingly transitions to Electronic Medical Records (EMR), various specialized Application Service Providers (ASPs) are offering related services.

According to a warning in [Health ; Medicine, 2006], privacy concerns arise with EMR because such records are accessible to hundreds of hospital staff members as well as a potentially vast number of payers, providers, and outsourced company employees who handle billing data. As a result, issues can arise that compromise privacy. The possibility of data interception also exists for open networks like the Internet and wireless computer networks. Other sensitive information, like that shared with ASPs, can lead to similar worries about data safety and privacy. Despite these concerns, the future of ASPs and the services they provide to customers is secure and remains highly important to businesses.

As global business requirements, data handling and storage needs, and expensive software continue to increase in complexity, the importance of ASPs and business relationships will also increase over time. However, customers must choose their ASP carefully to fully benefit from their services. In some cases, ASPs may only be priced neutrally, but traditional ASPs will remain an important component of all business sectors until a company can justify the cost of setting up their own ASP or equivalent services. These ASPs add value to businesses by providing web-based solutions for their needs and covering potential pitfalls. Therefore, it is

crucial for customers to ask the right questions before selecting an ASP for their business.

Consultants or business associations may be helpful in finding an Application Service Provider (ASP) if the business lacks in-house knowledge. When evaluating an ASP, the business should consider factors such as available bandwidth, physical location, data security measures, backup strategies for data, encrypted connections, power and server/internet redundancies, customer service, and financial status [Manage_More, 2004]. It's important to keep in mind that while ASPs provide vital services for businesses, sales staff may not always accurately represent their capabilities. Businesses who rely on an unreliable ASP could experience issues and potentially go bankrupt if the ASP is not run by professionals. While the ASP model initially seems beneficial due to low cost and quick start up times, many companies have faced financial loss and the need to replace their ASP. In conclusion, Application Service Providers have been beneficial for many businesses but it's important to thoroughly evaluate them before making a decision.

The flourishing relationship between businesses and ASPs has been attributed to several important factors including low initial start up costs, freedom from IT related issues, cost effectiveness, quick start up time, and no need for frequent hardware and software upgrades. This valuable relationship is expected to continue growing rapidly, benefiting both ASPs and businesses. However, it is essential to select a reliable ASP service in order to fully leverage its benefits. ASPs are causing significant disruption in traditional communication and business industries, demonstrating a top-down disruptive innovation [Christensen, 1997].
Bibliography: 1. Accounting, The Benefits of Using an ASP, [Online] retrieved from Internet on 4 February 2007, http://www.accountingsoftwareworld.com/

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