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On-Premise vs. Hosted vs. SaaS

On-Premise vs. Hosted vs. SaaS

Which is right for your business? On-Premise, Hosted or SaaS?

Technology changes at such a rapid pace that it can be hard to keep up. Today we are going to dive into the key differences of on-premise vs. hosted vs. SaaS (software as a service) and provide some great reference points that you can align best with your business.

On-Premise, Hosted, Cloud & SaaS Definitions

On-Premise Solutions

The best place is to start with a quick history lesson. Most businesses have some from of IT infrastructure that they leverage that allows them to operate efficiently and effectively. The traditional method that many businesses begin with is on-premise. In today’s world, on-prem deployment is considered a legacy approach. A legacy approach is not always wrong, as an on-premise solution does have its benefits.

Benefits of On-Premise Solutions

  • Increased security since control is controlled locally.
  • Performance can be important to users who have slower internet speeds and for when occasional software requires local installs for best performance.
  • On-premise software usually carries more features due to development cycles.

Weaknesses of On-Premise Solutions

  • Infrastructure: Average server life span is around 5 years and can be shorter depending on growth.
  • Cost: Considered a Cap-X expense and can be more expensive then SaaS counterparts.
  • Security: Endpoints, backups, patch management, etc. — all needs to be considered.
  • Future proofing: Many servers are more expensive upfront than required to account for future growth. If this is not applied correctly during initial purchase, it can lead to increases in long-term spending.
  • Remote access: Unless originally configured, users outside the office (remote workforces) will have a hard time accessing required resources.
  • Performance degradation: Over the course of time, hardware breaks down and will need to be replaced.

Hosted & SaaS Solutions

This is the future of where most businesses are heading. Hosted solutions generally come in two forms: hardware and software. A hosted server is very similar to on-premise as the main difference comes from the server physical location. This generally means that you get the same benefits as the on-premise solution but with far fewer of the weaknesses. SaaS generally refers to software without requiring the infrastructure to run the software but does not always have the same features.

Benefits of Hosting & SaaS

  • Time to deploy: SaaS-based solutions can be deployed almost immediately in most cases.
  • Expense: Upfront costs are low for SaaS.
  • Minimal Infrastructure: With SaaS solutions, hardware requirements are generally taken on by the company offering the SaaS solution. Hosted has the benefit of being able to right-size resources for the organization with the ability to scale on demand.
  • Flexibility: With both SaaS & hosted solutions, you can increase or decrease resources on the fly.
  • Security: Backups and updates are generally applied by the provider. This is not always the case and requires additional costs depending on the vendor.
  • Performance: Both solutions scale and are not affected by hardware degradation, as the underlying hardware is upgraded by either the data center or the SaaS vendor.

Weaknesses of Hosting & SaaS

  • Internet connection: Both solutions require decent bandwidth at location in order to function.
  • Transparency: Data storage with SaaS solution is beyond the control of the business owner. Hosted solutions will disclose where data is being stored.
  • Long-term costs: Upfront costs are generally lower and moved into an operating cost structure which can be higher, especially if on-prem hardware is owned.

Examples of Deployment Options

Scenario 1 – Startup / Small Engineering Consultancy

A small business with 5 people, you have 3 people working in one location, and 2 employees working remotely. You have minimal overhead, and you are expecting to grow quickly, so you need flexible and scalable systems.

What your key systems might look like:

Large Corporate Business Systems

In this example, a hosted, lightweight solution is totally appropriate. It allows you to focus on the business and not have to worry about managing an IT environment. New users can be added in minutes and can access information from anywhere with no specific hardware requirements other than an internet connection.

Scenario 2 – Established Mid-Size Engineering Consultancy

A mid-sized business with 50 people, you have 20 people working at one office location and users scattered throughout the states with no aspirations of any other offices at this stage. You have an established client base you work for and provide some specialist engineering design services which require some specific CAD software.

What your key systems might look like:

Key Small Business Systems

In this example, you probably have an existing investment in infrastructure and are probably already running a Windows network. You are probably also running an intranet and have appropriate network storage and data backup facilities. You have your own or regular IT support so you can manage your own environment. In this case, you may prefer the software to be installed on your network so you can control it. Hosting is less of a benefit for you, but you may still choose this option for convenience if your current environment is not appropriate for the software due to age or if it is already running at maximum capacity. Over the next few years, we will see a lot of businesses in this space start to run a hybrid model of on-premise and hosted software solutions.

Scenario 3 – Large International Corporate

As part of a global engineering consultancy, your systems are dictated by your owners. They are designed by an internal IT team to fit in with rules and processes as established by an internal governance team. They are very rigid and highly controlled, and most of your systems are on-premise where you have a team of internal IT technicians maintaining them.

What your key systems might look like:

Midsize Business Systems

In this example, the environment and the software are governed by internal policies. These are not agile systems, and they require a large investment in infrastructure. A massive amount of time and effort goes into establishing and maintaining these systems. Eventually, large corporates will start moving towards more agile hosted solution.

EstesGroup understands that not every business operates in the same manner. Some businesses require on-prem solutions while other businesses might be able to increase efficiency and reduce costs by moving to a hosted or SaaS-based solution.

If you are interested in finding out how you can make technology work better for your business, including which solution would fit best, we would love to help by setting up a 100% free business technology assessment. If you have any questions or are interested in find out how to make your business technology operate better, please email Chris Koplar at [email protected] or call 760-216-3452.

IT & Managed Services vs. Healthcare

IT & Managed Services vs. Healthcare

Managed Services vs. Healthcare: Similar Strategies, Similar Outcomes

I would like to start with a little self-reflection. If we are all honest with ourselves, we’d admit that no one enjoys purchasing or paying for health insurance. The process is cumbersome. There are a ton of options when it comes to purchasing health insurance, so how do I know which is the best option for myself or my family? Finally, health insurance is not exactly cheap. Most if not all of us have run into these hurdles looking at health insurance, and many of us have weighed the risk of not having insurance vs. the cost. Health insurance is investing in financial security for the unknown, and it’s shocking how closely this relates to IT and MSP services.

Business owners can view IT services in the same light as healthcare investments, and similar questions arise:

Managed IT Services vs. Healthcare Services
  • What are the associated costs? Is this cost prohibitive?
  • With so many options, how do I choose?
  • What is the risk if I do nothing?

The truth is that IT services very closely mimic health care.

Having a good MSP (Managed Service Provider) provide these critical services very much aligns with preventive health care. Going to the doctor for a routine annual checkup can head off a lot of health issues just like having an MSP can prevent a lot of IT issues. This includes hardware failure, data loss, and security issues that if left unattended would lead to larger problems down the road.

 

Critical IT services quickly justify the cost today by reducing the risk tomorrow.

Finally, IT and MSP services are critical to minimizing and reducing risk. IT services might not always be cheap, but the alternatives can be even more costly to business owners. Let’s consider this in the managed services vs. healthcare paradigm: you might not care to pay for the health insurance that covers lab panels or medications that you can currently live without, but if you ever need the tests and the treatments, enrolling in the healthcare plan today will lower your future costs and risks.

 

  • 93% of companies without Disaster Recovery that suffer a major data disaster are out of business within one year.
  • Downtime can be extremely expensive and range anywhere from $926 to $17,244 per minute.
  • On average, businesses lose over $100,000 per ransomware incident, including downtime and recovery costs.

A Managed Services vs. Healthcare Comparison Reveals Your Need for IT Expertise

Business owners who take IT seriously understand that the benefits outweigh the costs by leaps and bounds. 96% of business that have IT and MSP services in place, including BDR plans, are able to survive ransomware and fully recover operations. IT solutions and application hosting solutions can be expensive and require specialized knowledge. This is similar to choosing a specialized physician for a specific service. If you need a heart surgery, you see a cardiologist. Similarly, if you need cybersecurity, you visit an IT security specialist.

 

An IT Health Check First Appointment

Here at EstesGroup, we strive to make IT solutions simple for customers. Not only do we monitor the health of your business technology and provide the solution when something does go wrong, we also keep solutions affordable because we understand that not every business can afford or needs the same amount of coverage.

 

Imagine being able to visit a doctor and have an annual physical and have all the diagnostics to see your overall health — but at completely no cost. EstesGroup provides such a service, but instead of for your body, it is completed for your business, which is just as important. If you are interested in a free business technical assessment so you can get a handle on the health of your network, see your security risks, and get healthful recommendations, please email me at [email protected].

 

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