This is a guest post by Sara Carter. Sara is a co-founder of the website Enlightened Digital, entrepreneur, and Bostonian.  While writing in the tech and business space, her goal is to explore how changes in the digital world affect business growth and professional development, especially for women.

There are many options and vendors when it comes to computing software. For example, there are application suites such as enterprise resource planning (ERP), customer relationship management (CRM) offerings, and collaboration and content management applications in the software as a service (SaaS) race. However, there are a few other decisions to be made when it comes to utilizing this type of software solution. Organizations can either look to cloud hosting services or they can maintain their on-premise system.

The difference between the two is simple. Cloud software is hosted offsite through a vendor’s server and is accessed via the internet. The hardware is maintained by the vendor and the services generally come bundled in a monthly fee. On-premise software solutions are installed and maintained on site, in an organization's own data centre. The hardware is maintained by a local staff of IT professionals. While both can arguably be seen as beneficial, the benefits of cloud computing outweigh those of on-premise software.


When organizations are looking to incorporate something new into their everyday workflow, cost can be a major factor in determining whether or not to implement; especially if it’s a small business. According to Datamation, cloud computing is the better option when it comes to cost efficiency. When initially purchasing a cloud based solution, vendors typically require a low upfront payment with predictable, reasonable costs over time.

On the other hand, on-premise software involves a larger overhead cost to purchase the software, the hardware to run it, and the personnel to maintain the network. Space also becomes an issue. Maintaining the network on premise requires organizations to have larger offices, increasing property costs.


The next item many organizations are concerned with is the security of their computing system. At a glance, cloud computing might seem to be the riskier move. However, cloud based solutions are actually more secure since vendors of cloud software are knowledgeable in the field. They have security experts working for them who have the tools and knowledge to deploy state-of-the-art security measures within their systems. Since they are immersed in the field, they know the newest security technology and practices and can apply that to their systems, keeping data secure.

In comparison, with on-premise computing, individual organizations may not have as much security expertise as the vendor, making them less likely to implement proper data security. This makes cloud computing the better option. While it might be uncomfortable to let go of control over the control of information, it is actually the most secure solution.


As technology advances, many organizations understand how important it is for software to be user-friendly and easily accessible. Cloud computing opens many doors in this area. Cloud-based solutions mean employees can access their data from any device, regardless of time or location. Not only will employees have any information they need in the palm of their hands, the organization will have more opportunities for remote customers and workers. Being able to work from anywhere and have access to operating software allows organizations to work with more clients and retain the best employees because they are not limited by location.

Contrary to this, on-premise hosting is not accessible from all devices and the organization is responsible for the availability, not the vendor. On-premise computing can only be accessed on-site on internal computers that have the software installed. This can be extremely limiting for companies who are looking to expand. The only exception to this rule would be a slow VPN connection that is difficult to set up and unreliable.

Installation and upgrades

Installing software can often be a challenge for those who don’t work in IT. With cloud computing, vendors handle installation and upgrades. On-premise software holds many organizations back in this area. When services are handled through the cloud, there is minimal installation. Typically the only necessary step is ensuring the computer has the correct hardware/updates to use the software. From there, the vendor handles the upgrades and patches to the system. Since this can all be done online, the vendor will take care of making sure everything is up to date and running smoothly in real time.

For on-premise computing, the customer has to wait for new features and then purchase and download them to their network. According to Software Advice, this often takes time and requires downtime that introduces security vulnerabilities. It could take some time for the new software to come in and be up to date. This time creates space for potential security breaches when the software is not up to date and waiting for upgrades. This gap in protection is the perfect time for hackers to strike. 

While every organization has their own set of needs, cloud computing offers businesses more opportunity. It costs less, is more secure and accessible, and easy to maintain and update.  While there may be exceptions to this, most organizations who are using on-premise computing (or those who need it for their field) should consider a hybrid solution if they are unable to switch outright. It is pleasantly surprising how much the cloud has to offer.

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