On premises vs the Cloud: which is better for business?

When reviewing IT systems, businesses have always had to ask themselves: which is better, an on-premises system or a Cloud-based system?

On-premises options have been the more consistent method of powering a business’ IT technology. The main benefit of an on-premises system is the ability for it to be housed within a safe and secure environment on-site at a business’ office. As a result, employees benefit from constant and stable network access.

The Cloud has been regarded as an up-and-coming competitor but has suffered from issues such as poor connectivity. However, technology and internet speeds have improved making the Cloud a viable alternative to on-premises.

As many employees have moved from the office to their own home workspace, could it be that the Cloud is finally the preferred option for business IT requirements:

On-premises vs the Cloud

At Neuways, we have years of experience working with both systems. Our Managing Director, Martin Roberts, has advice and warnings when it comes to choosing either on-premises or Cloud-based systems for your business.

“The Cloud could be seen as a service you ‘subscribe’ to — similar to a streaming service such as Netflix, which can be entirely flexible to react to your business changes and market forces. The opposite could be said for an on–premises system — you buy and physically own an asset, which is more of an upfront investment. And has a static capacity

“Of course, that isn’t the only investment needed. If there is an on-site server, for example, it is worth remembering the electricity and cooling costs to power and maintain the hardware.

“The difference between the two is that the Cloud relies on constant connectivity — it is critical and simply doesn’t work without it.”

Two systems are better than one…

If a business’ staff are remote working, then Cloud-based setups could provide more flexibility. Microsoft 365 provides connectivity that copes well with distanced working. Documents or spreadsheets no longer need to be attached to emails and by saving in a shared environment colleagues can work collaboratively with ease.

Alternatively, on-premises systems can give businesses in industries such as manufacturing the stability they need to work daily, without having their processes compromised by a network outage.

Does a combination of the two systems make sense for businesses? Martin thinks so: “Both types of systems have their pros and cons — having both on-premises and the Cloud in place, in a hybrid set-up, might be the best choice.

“It all comes down to need — what does the business need this piece of technology to do? By considering the need, the current process and how it can be improved and made better or more efficient, a business can decide what is the best solution for themselves.

“In reality, the platform is the last element businesses should consider.”

On-premises systemCloud systemUpfront cost Vulnerability to connectivity issues Running cost Monthly pay-as-you-go subscriptionInflexible capacity Flexible capacity to scale up and down Cyber security vulnerabilities when remote working — VPN access is essential Easy to implement Business Continuity and Disaster Recovery plans to ensure data can be recoveredMore control over data security when office-based Potentially vulnerable to data centre disasters such as fire or cyber attack with no control over how this is handled or how your data could be accessed. It is recommended that there is a Cloud-based back up of your data as well for Business Continuity and Disaster Recovery purposes. Depending on where the data centre is in the world, your data could be subject to changing data protection laws and legislation.

Consider rigidity and flexibility

When considering such a system, a business should consider its future, and how that might help impact their decision, as Martin explains:

“For example, if you’re looking at implementing an ERP system soon, then Microsoft Dynamics 365 Business Central is based solely in the Cloud and has many of the functions a business will require. Users can pay for use on a monthly basis, allowing them to scale the system up and down depending on circumstances.

“Meanwhile, an on–premises system cannot adjust to scale particularly well. If you have plans to grow, then you might well need to upgrade to a system with more capabilities. On the other hand, if you needed to scale back, because of furloughed staff or a reduced demand for services, on-premises systems can struggle to adapt.”

A word of warning

For any business looking for a new system, regardless of whether it’s in the Cloud or on-premises, it can be difficult to know who to trust. Martin has a word of warning for any who are looking for a new system:

“There’s always a vested interest with vendors and the systems they work with on a day-to-day basis. Hardware vendors want to sell you hardware, while Cloud vendors will want you to invest in the Cloud. Each specialist vendor will try and convince you that their product is the perfect system for your business — regardless of whether it really is or not!

“At Neuways, we are positioned to help identify your business’ needs and whether or not on-premises or the Cloud is truly the best system for you. We’ll consider your IT and business objectives and strategies and tell you what technology is best suited to helping you achieve them.”

If you need any further help to identify whether an on-premises system or the Cloud is the way to go for your business, speak to a Neuways expert today. Call us on 01283 753333 or email at hello@neuways.com.