Imagine you are the captain of a ship navigating through the vast ocean of the SaaS industry. As the steadfast leader, it is your duty to chart a course that not only reaches new horizons but also ensures the journey is filled with value for your crew—your customers.

Your ship’s deck is your roadmap, detailing every strategic stop and innovation treasure. With a precise map at hand, you steer your vessel through the complexities of features and functionalities. You time each discovery for maximum impact and satisfaction of your crew’s objectives.

Back to reality…..

You need to decide if you’re going to build everything in-house or outsource certain components to third-party products (the famous buy vs. build debate).

How to Evaluate 3rd Party SaaS Product Development Software

In the case where you’ve chosen to outsource, you must carefully evaluate third-party integrations for product development before making a selection. There are many options for outsourcing, with the embedded software market estimated to grow at 7% CAGR, reaching $21.5 Billion by 2027.

We’ll explore the key areas to consider when choosing third-party development solutions. The vendor you choose needs to deliver the functionality, scalability, and flexibility to support your development processes now and into the future.

Our list of the best embedded analytics tools is a starting point.

1) Breadth of Necessary Functionality

There’s no point in embedding a third-party SaaS application component if it doesn’t deliver the necessary functionality. So, right off the bat, broad utility is a crucial requirement. To be the best embedded analytics tool, you should expect:

  • A variety of data visualization types, such as KPIs, tabular data tables, and heatmaps
  • Reporting on a broad scope of data sets for full visibility
  • Interactivity such as filtering and drilling down
  • Ability to set alerts and notifications, and schedule reports
  • Customizations, such as complete white-label analytics capabilities
  • Data write-back capabilities to build workflows
  • Interactivity such as filtering and drilling down
  • Custom data models so tenant users can customize their analytics

Finally, it’s great if the 3rd party SaaS development vendor you’re considering has all of this now, but they should also be continually innovating, which brings us to our next point.

2) Suitable Pace of Innovation

In today’s fiercely competitive SaaS world, third-party integrations for product development must enable constant delivery of new functionality. When you embed a third-party provider, this requires trust to deliver on their roadmap promises.

The vital functionality you plan to deliver to your customers must be ready to ship to production. If the third-party integration for product development doesn’t make it easy to ship, that could create a mismatch of expectations. You’ll want a clear timeline to decide if you can wait, or if you need to find another solution.

When analyzing the 3rd party vendor also think about the future. Ask questions such as :

  • What are your product’s key differentiators?
  • What opportunities do you have to innovate on top of their solution?
  • Is the vendor able to support innovation?

It is also important to understand their pace of innovation, release cycles and how quickly they can improve their product. Understanding the vendor’s product vision, strategy, roadmap, and release plan will help you inform the decisions you make and ensure that you can become long-term partners supporting one another’s success and growth.

3) Support of Cloud Native Architectures

Cloud-native software applications are developed and built specifically for the cloud. The Cloud Native Computing Foundation defines cloud native as technologies that, “empower organizations to build and run scalable applications in modern, dynamic environments such as public, private, and hybrid clouds.

Containers, service meshes, microservices, immutable infrastructure, and declarative APIs exemplify this approach….” There are many benefits to building applications with a cloud-native architecture. (We’ll be launching a whole series on that topic.)

Choosing a vendor that is natively built on the cloud means they can seamlessly fit into the way you operate and can be better integrated into your software lifecycle.

For example, cloud-native architectures have become the standard for modern software development. Modern development and operations workflows deliver agility, allowing you to build, test/validate, and ship products faster.

Cloud-native vendors can support continuous integration and delivery into multiple environments (development, staging, production etc.). Selecting cloud-native vendors will help you avoid delays in your current process as you continue to release and deliver value to your customers.

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4) Data Integration

Your analytics vendor must be optimized for your SaaS data model, including being able to adapt and support large volumes of data and unstructured data. Ideally, your data will be kept within your environment, never leaving your account to be sent to a third party.

This enables you to meet your users’ needs for data security and governance. Two key attributes are vital to achieving ideal data integration:

Ease of Connection

It should be easy to connect and work with the data sources and structures of your SaaS application. You need to be able to connect out of the box and have the ability to seamlessly model and optimize your data for analytics.

You should have these abilities regardless of whether the source is a structured database or something semi- or unstructured such as NoSQL, document stores, files, or other services.

Support for Complex Data Use Cases

SaaS products are often designed to offer maximum data flexibility for their customers. Many apps allow customers to create their own fields to enable users to capture and store what’s relevant to them. This results in customer data models changing over time. Any third-party tools should be able to handle these more complex data structures.

5) Data Security & Multi-Tenancy

Multi-tenancy is a shared software architecture where a single instance of software serves multiple customers (tenants) with common access and privileges. The two most common types of data models in a multi-tenant architecture are:

Segregated

Data is stored separately for each tenant, but the schema of the dataset is the same. You’d have a copy of each dataset for every tenant. The columns and fields would be the same, but the data loaded would be different. If this is your approach, integrating third-party components will be a relatively straightforward process.

Comingled

All tenant data is stored within the same dataset. In this case, you need a way to ensure that users accessing pages and reports are filtered for the data users from that tenant should see. When embedding 3rd party analytics it requires record-level security with your analytics app.

If your SaaS solution is one of the many that requires multi-tenant analytics, your chosen embedded analytics solution must be able to operate within your architecture, such as offering SSO to enable a user/tenant-based security model. Row-level security is also a must. With microservices, you can integrate analytics functionality into your workloads without any heavy lifting.

Specifically, your analytics app will have to support the creation of the user roles, application of record- or column-level security to the necessary datasets, and passing the user role to the analytics components.

6) DevOps

Third-party development of embedded components will require integration into your software development lifecycle. To achieve a seamless integration, it’s important to select embedded products that deploy directly into your environment(s).

With a self-hosted/deployed model, you can easily integrate directly with your multiple environments. These typically include dev, testing, QA, and production to support how your software lifecycle operates.

Once you’re integrated across multiple environments, you’ll also need to look for vendors that support that work well for DevOps. Features like version management, content deployments, and configurations across the various systems are important for seamless integration.

7) Scalability and Performance

It is incredibly important to ensure your product’s multi-tenant architecture has a solid foundation. This ensures the solution you are building scales as your business grows. Rather than provisioning servers to scale to the maximum capacity required, on-demand architecture changes the entire equation.

The big public cloud providers (AWS, Azure, GCP, etc) are also particularly advantageous for embedding advanced analytics. Container-based deployments with on-demand services are ideal for meeting many of the unique needs of SaaS companies, such as data security and governance.

Selecting a third-party SaaS software to incorporate into your SaaS app involves much more than choosing shiny features. Like buying shoes for kids with room to grow or a coffee with room to add cream, consider how the vendor continues to improve upon their offering into the future.

Also, evaluate how the component scales and fits into your entire development and delivery cycles.  

Watch our video, Building Better SaaS – Incorporating 3rd Party Products, as our CTO, David Abramson,and Natan Cohen, Head of Customer Success, discuss the potential pitfalls and best practices that must be considered when using 3rd party technology within your product.  

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