On Premise vs. Cloud: Key Differences, Benefits and Risks

by Gabriella Martin

There are many different factors a business must consider in order to help keep their data safe and accessible to their employees. In Covid-19 times, many organisations had to adjust to online means of operating so that employees would be able to work from home. But what should one consider when deciding whether cloud or on-premise data storage is for them? This blog will take you through the ins and outs of making that decision, and what the key differences, benefits and risks could be when making that decision.

Current Solutions for Cloud and for on Premise

On Premise vs Cloud

As mentioned above it is not surprising that cloud computing has increased in popularity (which was accelerated by the pandemic). It’s attraction lies in the attribute of newfound flexibility for organisations, everything from saving time and financial resources, to improving scalability, growth and agility. This contrasts to on-premise software which is installed on a company’s operating premises. This is where companies have their own secure firewalls (a feature whereby many older organisations hold the view of “if it isn’t broken, don’t fix it”). Moreover, various on-premise applications are reliable, secure and provide an adequate amount of control that clouds can often not really contain to the same degree. There is a general agreement between IT decision-makers within organisations and that is that, on-premise and legacy systems must be used in conjunction with new cloud applications. This is so that the company is evolving with the times and does not get let behind with inadequate software practices, and also more importantly so that they will be able to achieve their ultimate business goals by using cloud software.

On Premise software deep dive

No matter if a company decides to store its applications in the cloud or to keep them on-premises, data security will remain an absolute non-negotiable. However, for certain businesses operating within a very regulated industry, having on-premise data might be the only option available. This does have its perks, it is definitely assuring knowing that your data is located within your in-house servers and IT infrastructure. This will all contribute to one having peace of mind.
On-premise software requires that an organisation has ownership of certain licenses and therefore purchases those rights and all the relevant copies of the software to use. Because software is often licensed itself, the very nature of on-premise software requires the software to reside permanently within the organisations premisses. Therefore, there is usually a greater level of protection than with cloud computing infrastructure. So, if a company is in need of major security, why would they even venture making use of cloud infrastructure? …

However, there are a few mention-worthy downsides to making use of on-premise storage. Firstly, it is certainly associated with managing and maintain costs. Such expenditure will be ensure that all licenses and solutions and running smoothly, and these costs can have a significantly higher impact than costs relating to cloud computing environments. Moreover, an on-premise initial setup cost requires sophisticated in-house hardware, software licenses, integration capabilities and IT employees to ensure continuous support and to manage any potential issue which may arise. This excludes any amounts of maintenance that might need to occur should elements of hardware malfunction or break etc.

Cloud Computing deep dive

There is a distinct difference between on-premise software and cloud computing. It lies in the fact that with organisations who have on-premises software they are the sole host of everything that their organisation operates with. Whereas, cloud computing environments dictate that a third-party holder will become your host. This allows for companies to pay on an as-needed basis for software and effectively promotes scaling up and down being very easy. This is because the overall usage, user requirements and growth of the company is not a static element and is always susceptible to change.

A cloud-based operations sever makes use of virtual technology to host a company’s applications offsite. Therefore, there are no capital expenses, data can be backed up regularly and companies only have to pay for additional resources they use. For organisations which plan expansion on a global scale would find making use of cloud computing very advantageous. This is because it allows you to connect with customers, partners and other businesses worldwide easily and with minimal effort.

Additionally, cloud computing features are nearly instant and up-to-date, because everything is already configured in this way. Therefore, any new software that is integrated into your environment is ready to use once the companies subscription is active. Thus, with this instant provisioning, any time spent on installation and configuration of software is avoided as users and employees will be able to access the correct information right away.

Key differences and things to consider regarding on-premise vs cloud

As already established above, there are several differences between cloud environments and on-premise environments which should be considered. It is important to make note of these few factors and see which is most applicable to your specific organisation to ensure that the needs of your organisation are entirely met.

1. Cost:

On Premise: for organisations which would like to host their own software ‘in-house’ there will be an added responsibility for the continuous maintenance, energy consumption, physical office space and other applicable insurances. This can amount to a significant expense for an organisation, to merely protect their data and software.

Cloud: Organisations who wish to make use of cloud management systems will only be responsible for the cost of the resources which they make use of. No maintenance costs would be applicable, just the cost of how much is consumed in a given period of time.

2. Control:

On Premises: when an organisation make use of a ‘in-house’ environment for their data and software, it is likely that they are seeking a high degree of control. This is enabled by the use of on-premises software, and companies in highly regulated industries with massive privacy concerns are usually comfortable with this particular system. They often demonstrate hesitation to moving onto cloud software as they are concerned about the safety of their information.

Cloud: A major element of control in terms of cloud computing comes to light in the decision making process. The concern lies in the ownership of data when hosted by a third party. Should something go severely wrong, how will one remain accountable should the unexpected happen and the server goes offline? Access to data may be disrupted should the host experience technical difficulties, and that is something that organisations are not willing to compromise on.

3. Security:

On premises: This issue of security related highly to the degree of control an organisation requires when it comes to their data. Companies which have sensitive information (those within the medical, government or banking industries mainly) will need to assurance of an extremely tight level of security at all times. This is particularly in light of the ever increasing cyber-attacks seen on major organisations. Therefore, despite the interest in cloud data, the risk of something going wrong is too great to bare, and despite the increased costs involved with on-premise data and software, it always makes more sense to these sensitive industries members.

Cloud: It is no secret that security concerns are a massive issue when it comes to deciding whether or not to make use of cloud computing. There are often cloud breaches and cyber-attacks which are broadcasted and seen to have devastating effects on organisations large and small. However, the security of in-house data is not always full-proof either. Hard drives with sensitive information have been known to go missing, even fires and other disasters can leave organisations with ‘in-house’ hosting plans in shambles. Security of either method are no guarantee. That’s why considering a hybrid of these two options may work best.

4. Deployment

On premises: Resources are deployed internally when an organisation makes use of an in-house system. The IT infrastructure is therefore responsible for the maintaining of all the related processes for the specific organisation.

Cloud: Clearly there will be different forms of cloud computing for instance, public cloud, private cloud and hybrid cloud, there are still fairly uniform methods of deployment and that is, access should be granted to the applications one requires on a needs and usage basis.

5. Compliance:

On premises: Most organisations are subjected to various forms of regulatory control depending on the industries which they operate in. Therefore, it is always imperative that organisations are fully aware and abiding of these regulations, even in terms of data security and regulations on site.

Cloud: Organisations who do chose to make use of cloud computing models must always conduct their due diligence and ensure that their host third party is always compliant with regulatory mandates prescribed to them within their industry. Sensitive information and must always be secured and customers, partners and employees must have their privacy ensured.

Hybrid Cloud Solutions

As you have probably gauged there are risks that one will ultimately have to take in choosing either or solutions to data management. Security issues are sometimes outweighed by cost factors etc. It is really all dependant on the specific organisation’s needs. Therefore, often a hybrid solution is deemed the best- the best of both worlds even. A hybrid solution essentially utilises a range of deployment models ranging from on-premise to cloud (private and public). A Hybrid cloud solution is becoming more and more popular in the world today, especially since the Covid-19 has had a massive impact on on-premises work and has encouraged a massive shift online.

Current Solutions for Cloud and for on Premise

Let’s take a look at which project- and task management tools are currently offered for cloud and/or for On Premise.

Cloud Project Management Tools

  1. Meistertask
  2. Trello
  3. Freedcamp
  4. ClickUp
  5. Bitrix24
  6. awork
  7. Jira
  8. Wrike
  9. OpenProject
  10. Allegra
  11. Monday
  12. Asana
  13. Bitrix 24

On Premise Project Management Tools

  1. Allegra
  2. Open Project
  3. Bitrix 24


As we see in this comparision, only three project management solutions offer both cloud- and on premise hosting. If you would like to learn more about Allegra and why Allegra is the most comprehensive project management software available, book your free live webinar here: Allegra free live Demo.

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