On-Premise Versus Cloud Computing: How To Decide, Which Is Best For Your Business And Your Contact Center

Organisations that are selecting a new call center platform have some complex decisions to make. Not only do they need to identify and prioritise functional requirements, but they also need to decide between on-premises and cloud environments.

On-premise versus cloud computing is often a highly debated topic due to the pros and cons of each option. On-premise solutions, which are hosted on a company’s own premises, allow you to develop your own customisations and implement your own security measures. However, hosting your own call center software can be expensive, and on-premises systems can also be inflexible and difficult to scale. In contrast, cloud software, hosted by a third-party provider, is more flexible, scalable, and cost-effective than on-premises solutions.

The decision on which model is best depends on each organisation’s unique requirements and type of business. Having a fundamental understanding of the two options will help you make an informed decision about which is best for your business and contact center.

On-Premise Versus Cloud Computing

1) On-Premise

As the name implies, a company on its own hardware and within its own facilities hosts on-premise software. This means that the organisation is responsible for tasks such as:

• Purchase of software licenses.
• Installation and testing of new versions.
• Purchase, hosting and administration of servers and other related hardware.
• Network maintenance.
• Manage databases.
• Protection of systems and data.

On-premises call center solutions are often associated with legacy systems, but there are still vendors producing current on-premise call center software.

What Are the Advantages of On-Premise?

• Full control over data security.
• Possibility of customising the software.
• Limited or no dependence on Internet connections.

What Are the Disadvantages of On-Premise?

• Inflexible scaling.
• Potentially high IT overhead.
• The software may not include the latest updates.

Therefore, an on-premise solution may not provide the flexibility and innovation a business needs to be competitive, but the fact that it can be customised and organisations can employ their own security measures makes on-premise software the option suitable for some of them.

2) Cloud Computing

More and more companies are adopting cloud-based solutions, and the pandemic accelerated the adoption rate because remote workers, including contact center agents at home, easily access software in a Cloud Computing environment. 

The definition of Cloud Computing encompasses a wide range of technical services, including infrastructure, development, data storage and software applications, such as cloud contact center platforms.

What Are the Advantages of Cloud Computing?

• Fast and easy scalability.
• Business agility.
• Reduced IT overhead.
• Facilitation of remote work.

Comparison between On-Premise and Cloud Computing

1) Cost of On-Premises vs. Cloud

With on-premises software, users must purchase items such as software and database licenses, hardware, and development and testing environments, as well as pay IT staff to manage them. Users typically need to purchase software licenses to reach the expected maximum volume, which means licenses may not be used during slower times in the business cycle.

In contrast, fees paid to cloud software providers are typically counted as operating expenses. And because these vary with consumption, the cloud is usually a more profitable option than on-premises software. Additionally, because the third-party vendor hosts the software, IT overhead is significantly lower. As an added benefit, companies using cloud systems never have the unplanned expense of replacing a server that suddenly fails, making cloud expenses more predictable.

2) On-Premise Security vs. Cloud Security

With on-premises systems, companies are responsible for keeping data secure. This can be an attractive feature for organisations that have the resources and experience, as well as a critical need to implement data security measures beyond those offered by a cloud software provider. However, for other companies that do not have the in-house expertise, handling data security on their own can present risks.

On the other hand, being in the cloud adds some risk to data security, but cloud software can be very secure if you choose the right cloud service provider. Software providers have teams of data security experts who focus on safeguarding data. Additionally, compliance with industry standards ensures that third-party auditors have evaluated your data security practices.

3) Control and Customisation of On-Premise vs. Cloud

One of the advantages of using on-premises software is that it can usually be customised to meet specific user needs. However, customisations are typically not supported by the vendor and can make implementing software updates more complex.

Cloud contact center software is generally not customisable, but industry-leading solutions typically include a multitude of configuration options. And, since CCaaS applications are based on call center best practices, the transition to the cloud can be an excellent opportunity for companies to revamp processes.

4) Scalability between On-Premise System and Cloud

When comparing on-premises scalability to cloud, cloud wins. Adding capacity to cloud software is simple and can be done in a matter of hours, if not minutes. Conversely, scaling on-premises applications may require purchasing more licenses and additional server capacity. The advantage of quick and easy scalability can be the deciding factor when choosing which type of platform to use.

Factors To Consider When Choosing between On-Premise and Cloud Computing

All the advantages and disadvantages that we have just analysed must take into account, which is the best option for your organisation. Additionally, you must consider:

• The time frame.
• Existing IT resources and skills.
• Budget.

It must also be taken into account that more and more companies are moving away from local software and looking to the cloud. For example Gartner projects that spending on public cloud services will increase 20.7% in 2023. That’s on top of a projected growth rate of 18.8% the year before.

Cloud Computing is not a thing of the future. It’s what today’s industry leaders are using to create the agility needed to quickly capitalise on emerging business opportunities.

Enreach’s Omnichannel Contact Center features inbound customer service software that delivers superior user experiences and optimizes customer service operations.