Making the Choice between Cloud and On-Premise


So you’ve finally settled on SAP Business One as your ERP (enterprise resource planning) solution of choice. Hold on – you’re not done yet! You’ve still got a very important decision to make. Should you have your implementation done on-premise on in the cloud?

The Argument for On-Premise:

With On-Premise (often referred to as on-prem for short) deployments, your software is installed on your own hardware, which is located on your premises as the name suggests. Your server is also typically located on your premises due to its heavy responsibilites for managing, storing, sending, and processing data 24 hours a day, 7 days a week, and 365 days a year.

Proponents of this option say:

  • I would rather pay upfront

    for my ERP software – after all, my business is going to keeping using it for years to come! It will probably cost me more overall to pay for a cloud subscription year after year.


  • I don’t have to worry about slow internet speeds

    and hackers targeting my cloud service provider, or facing price hikes on my cloud subscription.


  • I like being able to customize my solution

    which is not an option supported by most cloud vendors. By opting for an on-premise installation, I can also usually have my new ERP solution integrated with my existing software.


  • Having my hardware on-premise will give me greater ease of mind

    since I only have to worry about the physical security of my premises, not vulnerabilities in my internet connection. Physical threats are easier to see, eliminate, react to, and fix! I can also control access to my software and data easily.



The Argument for Cloud:

Cloud subscriptions have been rising in popularity in the past decade or so, and for good reason. With your ERP software in the cloud, you pay a subscription on a monthly or yearly basis, either at a fixed rate based on your chosen solution or according to your usage.

Proponents of this option say:

  • Paying for a cloud subscription is a lot easier on my pocket

    than paying heavy upfront costs to get started on-premise. I don’t have to worry about setting aside a large sum of money to acquire expensive hardware and pay for license costs, as well as pay for someone to install both the hardware and software.  In fact, I don’t have to leave the aircon on in my server room all day, or even set an area aside to house the bulky hardware.


  • Having a single subscription cost spares me headaches

    from keeping an eye out on hidden costs spread all over the place. I can easily keep track of the costs associated with my ERP solution.


  • Security risks, server downtime, maintenance, and updates are all responsibilities of my cloud provider now.

    That’s a lot of value for money! I no longer have to assess whether I need to set aside a budget for the next costly software upgrade, nor will I need a dedicated IT staff member on my team and various security measures to ensure things are running smoothly.

    With cloud solutions, business owners sometimes fear loss of control, and data breaches. These are valid concerns, but public cloud giants like Amazon Web Services are well equipped with the experience, technology, and know-how to guard themselves against these attacks. A malicious attack on your company’s database specifically is also more difficult than with an on-premise setup.


  • Working on the cloud allows me to scale granularly

    so I can get started with even a single user, and can simply pay per additional user as needed. I even have the flexibility to cancel subscriptions ahead of my next billing cycle if I want to scale down, thereby cutting down on my expenses.

    Things are not so straightforward with on-premise installations. Hardware cannot be scaled up or down so easily or granularly, and licenses cannot be revoked. That means I would still have to pay the annual maintenance fee on unused licenses.


  • I can get started immediately

    unlike an on-premise installation which typically takes months to complete. Most cloud solutions let me get started right away!


  • Working on the cloud gives me more time to focus on more important issues

    Instead of worrying about the daily backup and security of my data, I can spend a little more time nurturing customers and prospects. In fact, businesses who work on the cloud tend to make more money!


Whichever implementation type you opt for, you probably can’t go wrong with SAP Business One! Are you ready to move on to the cloud?

Try SAP Business One on the cloud for free!

No credit card details necessary. Limited trials available until December 2016 only.

UPDATE: Trials now available for 2017!