PiF Technologies

What is the difference between On-Premise vs. Cloud-based document management?

Whether you hear it called by the name enterprise content management (ECM) or digital document management, at its most basic level, these types of systems capture, retrieve, and store your business’s documents digitally in a centralized location. The benefits to migrating your files to a digital storage location include eliminating 90% of physical paper records, a 95% reduction in costs related to physical storage, increased staff productivity and a significant reduction in costs related to manual data entry. 

If you’ve decided to purchase an ECM system – that’s great news! You’ve completed the first step. Now, step two is another important decision; where the system will live: on-prem or via the Cloud.

What is The Cloud?

Cloud Computing is the practice of using a network of remote network servers hosted via the Internet to store, manage, and process data. In simple terms, the Cloud is data centers that are available to users over the internet. Cloud systems promote a secure environment for your business and your employees and is a great solution for hybrid or remote based teams. Users can access their files anywhere they have an internet or LTE connection and on any type of device (desktop, laptop, tablet, smartphone, etc).

What does “on-prem” mean?

On-prem is short for on-premise which can also be defined as self-hosted, on-site, or locally operated. On-premise simply refers to hosting your document management system and files on the servers currently running in your offices. Most of the time, your staff can only access these servers when they are physically in the building. This can sometimes create trouble if someone is working remotely or traveling for work, creating unintentional limitations on how easily they can access their work files. On-premise systems do not require the user to be linked to the Internet to access files as they are often hosted locally on the individual’s computers.

Companies considering a document management upgrade should be aware of the major differences and limitations between on-premise and cloud-based systems. The biggest and most obvious difference between the two is the location and who is responsible for maintaining the system throughout its life.

At PiF Technologies, we have customers who are loyal to both sides of the on-prem vs. cloud debate. But, how can you decide? Here are a few things to keep in mind as you consider your options: 

Cloud-hosted document management:

Low overhead cost, minimal start-up investment
By reducing your costs by migrating to the Cloud, you can reallocate these funds to other important activities within your business. You can also eliminate paying for hardware, software, and other services you aren’t utilizing.

Fast time to market
With less planning involved with a Cloud startup than an on-prem venture, your business can expect a much faster turnaround.

The promise of security and safety within the AWS disaster-proof data center
Cloud hosting on Amazon Web Services (AWS) via PiF allows you to replace on-site IT servers and components  with simplified, on-demand access from anywhere in the world. This minimizes or completely eliminates the need for continuous server reinvestments.

No associated capital expenses – Pay per your needs and usage requirements
Increase capacity for more users, data, and storage as your company grows. No maintenance costs, technical management is done by the Cloud service provider.

Easily upgrade or downgrade your plan per business scalability and growth
Upgrading or downgrading your Cloud storage and capabilities is as easy as adjusting your subscription; no hardware and no scaling requirements.

Routine backups
Data stored in the Cloud is hosted on servers that can be located anywhere on earth and, therefore, makes a physical data breach much less likely. (PiF’s east coast customers utilize AWS servers in Virginia and Ohio!) In typical cloud contracts, the host will automatically back up your data as part of your subscription.

Lower total cost of ownership
The total cost of ownership (tco) is the sum of the purchase price of an asset plus operating costs for its lifetime. Knowing these costs allows businesses to make an educated decision on solutions and products by seeing beyond the purchase price. Consider what investments your organization is already making in your existing storage process. By gaining a better understanding of the costs you’re already incurring, you can make a more informed decision about the true value of investing in cloud storage.

Cloud hosted = internet connection required
When considering an on-prem vs. Cloud-based document management system, the way your staff accesses their files is an important consideration. On a cloud-based system, you must maintain an active internet (wifi) connection in order to access your documents.

Now that you have some context on Cloud-based ECMs and you understand how cloud storage works, take a look at the next section about on-premise document management and the differences between the two.

On-premise (self-hosted) document management:

Internally managed & easily accessible under control by your company
Resources are deployed within your IT’s infrastructure so your company is ultimately responsible for maintaining and managing the solution and processes within it.

Hardware and software license needed
Regardless of the scale or size of your business, some form of hardware and software will need to be purchased to effectively run your document management system. This depends on the sheer amount of data you are managing as well as the number of users (staff) utilizing the servers. More people = more servers = higher costs

IT employees to run and manage it successfully
On-premise systems require a dedicated and qualified professional IT team to ensure your system is operational. From preventing security breaches, implementing anti-virus software, and correcting any and all tech related issues, your IT infrastructure comes at a significant cost to your business.

Bigger investment and higher costs associated with maintaining and managing
Many businesses that utilize on-premise servers are also backing up their data via additional servers. This is costly and recovering data takes time and energy out of your IT infrastructure.

On-prem scalability comes at a cost
Being bound to physical hardware means purchasing new servers and data storage facilities (if needed) in order to expand. This doesn’t include the cost of supporting the new hardware and the accompanying sunk costs associated with voltage management, electric, AC/HVAC, cabling, and more.

Self-hosted = company controlled & maintained
If your document management system is based in-office, your IT team is responsible for keeping the system up and running. In this case, your staff is not dependent on an internet connection in order to access files and documents.

A happy medium

At PiF, we also offer a solution called the Hybrid Cloud which utilizes both a cloud based system and your pre-existing on-premise infrastructure. Businesses who choose to go this route may do so because of many reasons, but primarily it is done because of compliance or security concerns with a complete move to the cloud. Cloud-native development lets developers transform singular, outdated applications into business-focused functionality units that can be run anywhere and reused within a variety of organizational needs. If you decide to only partially move your infrastructure to the cloud, you can always make the full transition in the future due to the flexibility and adaptability of Cloud hosting.

We’re happy to help you with making a decision.

If you haven’t made a decision on whether Cloud-based or On-Premise based is right for you, we’d love to help you decide. Everyone’s circumstances vary and we will help you make a decision best for you and your business. Send us a message today to set up a time for a one-on-one conversation.

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