Applications on premise vs cloud: what is the best option?

Ash Baggott

In an ever-adapting technological world, there are many factors a business needs to consider when deciding whether a cloud infrastructure is the right way to go. As such, a lot of companies decide to not take the leap and rely on their functioning on premise applications and software programs to do the business. But which approach is the best option?

It’s certainly not breaking news that cloud services and computing have become the ‘go-to’ solution over the past few years, the flexibility, scalability, and agility the cloud provides for enterprises is a newfound way of saving time, and money. 

However, on premise applications have been installed and functioning for many years, and have been – for many – the only way your business could operate. They are reliable, secure, and allow companies to maintain a level of control internally … and, if it’s working, do you really need to change it and move to the cloud?

On premise applications: the pro’s and con’s

Whether it’s the business’s decision to place applications in the cloud or to store them on premises, one factor will remain the main priority, data security. For those firms operating in highly regulated industries, there may be a lack of choice about whether your applications are stored on premise, knowing that your data is located on in-house servers might provide more peace of mind.

Any application or software you store on premise will require that your business has purchased the licence of the software or a copy of it. The software itself will be licenced and there will be generally better protection than using a cloud storage software. But if on premise is so safe and your company is required to have so much extra security, why would anyone consider storing all of their applications within the cloud?

Because, in fact on premise applications come with quite an expensive amount of downsides.  Managing and maintaining all the solutions means that associated costs can be significantly higher than a cloud software. Your on premise setup will require in-house server hardware, integration capabilities, software licences, and IT employees on hand to support, and manage arising issues. Also, your hardware and servers will need to be upgraded often to remain compatible as technology continues to evolve.

Cloud applications: the pro’s and con’s

There’s one critical and significant way that the cloud differs from on premise, instead of a business hosting everything in-house, cloud applications are provided and managed by third-party. This allows businesses to reduce initial costs but paying on a ‘as-and-when-I-need-it’ basis, which can be scaled up or down based upon overall usage, user requirements, and the growth of the company.

Cloud-based applications, like Dropbox take advantage of virtual technology which enables applications to be hosted offsite. There are no initial expenses, your data is regularly backed up, and firms only pay for the resources they use. If your business is gearing up for quick global expansion, the cloud offers unparalleled appeal due to its’ ability to connect with customers, partners, and other business anywhere in the world with minimal effort.

Plus, you can instantly access all of your most-up-to-date data, and any new applications you implement will already be configured and will be available and functional immediately. In terms of productivity, any time spent on installation and configuration is therefore removed.

What’s the best option?

Which path is the correct one for your firm is completely dependent upon your needs and what applications you are looking to implement, and what you want out of a solution. When deciding you need to take into account the following:

  • Deployment
    • On premise: Your firm is responsible for maintaining the application.
    • Cloud: The service provider is responsible for the up-keep of your application.
  • Cost
    • On Premise: Higher costs, and your company is responsible for the ongoing costs of upgrading your software to be compatible.
    • Cloud: You only pay for the resources that you use, there are no maintenance or upkeep costs.
  • Control
    • On Premise: You have greater control over your applications, you decided where you store your data, and what happens to it.
    • Cloud: Ownership of applications and data can be a ‘cloudy’ area. Data and encryption resides with your third-party provider, so if anything unexpected happens, you may not be able to access your data until the problem is fixed.
  • Security
    • On premise: Your data and information will undoubtedly be more protected on-site and is probably the biggest attraction about keeping applications on premise, especially within the government and banking industries.
    • Cloud: Security is the highest concern when it comes to storing your applications in the cloud, for all of it’s advantages, you have to accept that you’re more vulnerable to security breaches.

Regardless of which route you take, every company needs a solid infrastructure that can change, adapt and comply with the ever-evolving business world we live in today. Holded’s ERP Cloud #1 Software allows you take control of your business, whilst helping you save time and increase productivity. You can manage your sales, finance, operations, and human resources in one beautiful platform.

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