Navigo Blog

Cloud vs on-prem software: which is better?

Written by Tom Wade

March 10, 2016

All the latest technology news is about the advancements of cloud software. It feels like a cloud software company becomes an overnight success every day.

So what’s the big deal about cloud software, and how does it differ to what you’re already using?

Here’s a guide to the characteristics of cloud programs, on-prem software, and the differences of each:

On-prem software


Source: Jamie Moore

On-prem is the traditional software you may already be familiar with. These are the programs you install on your computer: Microsoft Office, SAP, and OrgPlus.

On-prem is traditionally installed either by CD or as a digital download. Product updates are performed manually and only licenced users can install the program.

Any files you create with on-prem software is saved to your computer. Sharing files requires making copies and sending them to interested parties.



Source: Jamie Moore

Control over the system and the data is the biggest advantage of on-prem software. All data is stored within the organisation, and your IT team can customise the software to suit your organisation’s needs.

Your IT team has complete control and maintenance over your system. Your organisation has complete visibility on who is using the program and who has access to it.

Pricing for on-prem is usually a one-off expense. Organisations only need to pay if they wish to upgrade to the latest version or if they want further licences for employees.

Otherwise, organisations purchase the software once and do as they please with it.



Source: Alex

On-prem software can be slow to set up, since the organisation must do so from scratch. Any maintenance and upgrades require downtime, which will need to be done outside of high usage periods.

Remote connectivity is also an issue. Files and access to the program are restricted to your work computer. Accessing remotely requires remote takeover and screen sharing.

Running a demanding program can strain an internal intranet. A majority of company server use can be consumed by large, resource-hungry programs.

The cost of on-prem software is also high. The purchase may be a once-off, but it can be expensive depending on the program.

Upgrading can be expensive as a result. Each new version of a program must be purchased as organisations intend to upgrade. Organisations need to make the decision to pay the cost of upgrading or make do with their older version of a program.


Cloud programs are hosted online. You can usually tell a cloud program by whether it runs from a tab in your browser and requires an internet connection.

Cloud is a newer technology used by more recent software companies. Anyone using Bamboo HR, Google Docs, or Planning@Work are using cloud software.

Files created on cloud programs are often stored online too. Multiple users can also access a file, as in the example of Google Docs.

Information on a cloud program is viewable to anyone with access to the program and the relevant permissions.

Pricing of cloud services usually works on a subscription model. Organisations pay a monthly fee for a program based on their demands and usage. Many cloud programs also offer a free version for small-scale or personal users.



Source: bfishadow

Control of data and the program is handled externally in cloud programs. This takes the burden of maintenance off internal IT teams. The provider uses their servers and maintains the data for the customer.

The data security of large cloud companies is greater than what small-scale teams could provide. Many cloud software providers host their program in the Amazon Web Server, meaning their data has the collective security of a company like Amazon behind it.

The subscription model of pricing is more accessible to smaller organisations. Instead of paying a single, large expense- cloud offers a smaller, recurring fee for access to their services. This model gives more organisations access to tools previously exclusive to massive enterprises.

The cloud model also means users are updated with the latest updates as they happen. The price of cloud programs usually stays the same as more features are added. The exception is optional modules and features which may not be relevant to every organisation.

Cloud programs and data are accessible from anywhere with an internet connection. Users just need their username and password to access tools from any connected device.

The latest version of a file is stored online and removes the need to create multiple iterations of files.

As a result, many cloud programs have mobile versions of their products. Cloud is making it possible to work on the go, on site, or from anywhere with an internet connection.

Setup of a cloud program is fast. Small cloud programs create an environment for users instantly, meaning it is possible to start using a program as soon as it is purchased.



Source: Jussi Ollila

The remote hosting of data can be a concern to some organisations. Some IT departments would be more comfortable with managing their own data, as it is out of the organisation’s hands when hosted on another’s servers.

Requiring a connection to the internet means cloud programs are only as fast as the connection they have. No internet means no software.

Being hosted remotely means organisations have less control of the program. IT departments cannot customise the program to the specific needs of the organisation.

Organisations will have to pick between a cloud program with built-in customisation options, or change their processes to fit the program.

Some organisations do not prefer the subscription model. It can be difficult to justify a recurring expense if an organisation does not see any value from a program.

The subscription model can also become expensive in the long-term, compared to the on-prem licencing model.

Which is better?

Cloud is the trendy option many modern organisations are moving towards. The advantages of lower cost, greater mobility, and faster setup are the main reasons for making the move.

As bandwidth speeds increase and price drops, moving towards cloud options is becoming more and more viable.

Cloud programs are usually a best-of-breed app that covers a specific function or niche. But the lack of customisation means focused niches can go unserviced by cloud programs.

There are a range of cloud program categories, but even theses have sizable markets. You’ll only struggle to find a cloud service if you work in a specific niche or have a strict, established process.

On-prem programs focus on being an all in one suite of tools. However, the advantage of customisation means on-prem programs can do any number of tasks.

The verdict of which is better will come down to what needs your organisation has and what programs you are currently using.

Many cloud programs will integrate with other cloud programs to form a whole platform of tools. On-prem programs will perform a variety of functions, but with varying performance.

Look at the systems you have and what works best with them. The preference for cloud or on-prem will vary from organisation to organisation.

Talk to us about what type of org charting solution will suit your organisation

Here at Navigo, we sell both cloud and on-prem versions of org charting software. Get in touch with our consultants today to determine which type of program will best suit your business needs.



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