SaaS Application Development Lifecycle, Challenges, and Recommendations

The technological advancement has propelled the growth of software development. The advent of new technologies have disrupted many industries and therefore digital transformation is the need of the hour, but not every business can afford the software development costs. To democratize access to technology, software subscription models have taken place. They are called SaaS Application Development Lifecycle (Software as a Service).

Typically, the SaaS application development services providers charge subscription fees for their software products. The products are delivered and stored in a cloud-based environment which means that the customers don’t have to download the software product on their system. They can access it through a web browser or a mobile app. Hubspot, Mail-chimp, Google Drive, Shopify, Zoho, Twillio, etc. are examples of successful SaaS products.

The SaaS application development services have become the trend as more and more businesses are leveraging the subscription-based software service model. Since, we’ve developed and scaled multiple SaaS products over time, here we’re sharing the development life-cycle, challenges, and recommendations for SaaS Application Development Lifecycle.

SaaS Development Life-cycle

For SaaS development life cycle, the cloud service provider is a critical success factor, and therefore the cloud service deployments require a different approach than ordinary software development. The SaaS Application Development Lifecycle approach is typically focused on the assessment of the cloud provider in terms of platform capabilities and operational enablement.

This SaaS development life cycle illustration assumes that there were no cloud service provider preferences prior to the project initiation. However, if it is not the first SaaS-based product the enterprise is going to have, the Platform Evaluation, Subscribing, and Operations phases of the SaaS development life-cycle will be less detailed. It is because the SaaS developers can leverage the work that has already been done during the recent SaaS development.

Following steps are the best way for a SaaS Application Development Lifecycle:

1. Envisioning

Envisioning is the first phase of SaaS Application Development Lifecycle and includes identifying new business opportunities, where the company leadership identifies the gaps in the market, or how to upsell to existing customers. SaaS solutions envisioning is no different than a traditional software envisioning. However, the SaaS products open up new opportunities as the business leaders will have fewer constraints due to reachability, discoverability, and scalability of the solutions. The activities required at this stage are as follows:


  • Identify existing business requirements
  • Visualize business opportunities and market trends
  • Decide whether to buy or build
  • Assess sales, marketing, and licensing models
  • Identify the SaaS solution needs

Decisions made during Envisioning

  • Executive sponsorship

The market research and trend analysis will guide the company executives to decide on the sponsorship of the SaaS application development.

  • Economic Justification

SaaS product development cost will be weighed against the total investment and the ROI period will be calculated.

  • Buy vs Build

Decisions will be made on whether to buy or build the services. In the case of building the service, either the existing IT department or a system development company will build the SaaS solution. Alternatively, the solutions can be bought from independent software vendors (ISVs).

  • Cloud Platform Assessment

Based on the platform characteristics and support, the organization will shortlist the cloud service providers.

  • POC Plan

The management team will move forward with the decision of creating a proof of concept (POC) for the solution.

2. Platform Evaluation

The performance of cloud service providers is very critical for the success of a SaaS product. The SaaS product development strategy will require activities that focus on selecting the best cloud service for the product. The ISVs or the company building the product will need to pick the cloud service that helps them realise the product strategy planned during the envisioning phase.

In arriving at a decision that is fit for purpose, the SaaS software architecture proof points are intersected with the cloud’s platform features and capabilities. There are cases where the existing relationships of the product owner or the ISV with the cloud service provider play a vital role in moulding the architecture to fit the cloud’s requirements.


  • Design the technical architecture
  • Define the functional and non-functional proof points
  • PaaS solution economies assessment
  • Weight the cloud platform features and capabilities with respect to the SaaS product architecture
  • Plan for POC with a small list of PaaS vendors
  • Try to acquire the trial subscription to PaaS solutions
  • Plan the product development phases (waterfall or agile)


  • Selecting the fit for purpose cloud PaaS

After the completion of the cloud platform and POC evaluation, the ISVs will be able to pick the best cloud platform for the SaaS solution.

3. Planning

When the cloud platform selection, feasibility analysis, and fit to purpose analysis has been completed, the planning phase can begin in order to plot the course of action for a project delivery prediction. The complexity of the planning activity largely depends on the project size. The activities carried out in this phase of SaaS development life cycle is quite similar to the traditional software development lifecycle.



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