To put it succinctly, there is no easy way to decide whether the on-premise or SaaS model will be cheaper in the long run. However it is worth noting that the industry is moving fast towards the SaaS model. And there just might be a scenario where the on- premise model ceases to exist and one would have to jump in a hurry. Hence it is advisable to embrace what is the certain future of the CRM industry. However if you are still deciding, below are the key points worth pondering upon:
- The cost of purchasing and maintaining your own on-premise hardware: The cost of acquiring the hardware and the software for your solution
- The cost of annual maintenance of software: Studies show that it costs approximately 20% of the cost of acquisition as annual maintenance costs. One may choose not to pay but then you end up acquiring an unsupported expensive piece of software.
- Implementation costs: These costs are certainly lower with SaaS, however it is important to consider who and how good the implementation partner is . The cost of customisations will depend on
- How much customisations have been done
- How well the design was done and
- How well the customisations have been documented
- Efficiency of cloud: It is not easy to quantify the gains but it is only fair to offset these gains against the costs
Furthermore, if you are interested to analyze cloud vs on- premise costs, one can use this calculator to know the TCO (Total Cost of Ownership) comparing cloud cost to on-premise costs for similar capabilities.
If you want to discuss about a project, you can write to us for a free consultation here.