On-Premise, Hosting, & Cloud Services - What's the Difference?

  • Filter by Category

  • Filter by Tag

Mentoring Staff


Picture this: It’s the start of a new fiscal year and you are tasked with the responsibility to evaluate on the best method to deploy your organization’s financial software. You’re presented with three options: a classic on-premise install, a remotely hosted solutions, or a cloud-based model. Do you know which you’d choose? And what the key benefits and risks are for each of your options?

If you’re not quite sure, that’s okay. There are a lot of factors to consider when choosing a deployment type and there’s no one-size-fits all approach. And you’ll need to consider other important factors like cost, security, scalability, and changing technology to help make the best decision for you organization.

That’s why we’ve put together this guide to help you understand the three software deployment options as well as suggest a few tips to help you make this important decision.


On-Premise Software

Exactly as it sounds, on-premise software is the implementation route where clients purchases a software license from a vendor and then installs it on their organization’s own servers. This means you are responsible for everything related to running the software including the network infrastructure, security, and maintenance. Some of the benefits of installing on-premise include increased control, security, visibility, and the ability to simplify data compliance. Typically, the vendor will have options for ongoing maintenance and support packages for an additional fee. This option works best when you have an in-house technical IT team.


Hosted Software

With a hosted solution, you will purchase a software license from the vendor and access it remotely (anywhere, anytime) through a secure and reliable internet connection using the vendor’s infrastructure, hardware, and setup. The user purchases the license and pays an additional fee for hosting privileges. Ongoing maintenance and support packages are an additional cost.


Cloud Software (Software-as-a-Service)

Cloud software, also known as Software as a Service (SaaS), means that you do not have to purchase any license or infrastructure outright. Rather, with a monthly or annual fee, you’ll be able to access the software via a secure and reliable internet connection that is fully managed and owned by your vendors. If you have a small team, SaaS models may relieve the need to purchase, install, manage, and upgrade technology on-site. The benefits of a SaaS model include scalability, simple management, improved workload mobility (access anytime, anywhere!), and provide emergency preparedness. These benefits are being recognized by cities and counties that continue to rank cloud technologies as a priority for their IT department.


Hybrid Approach

There is one more option that you can consider when evaluating software deployment models: a hybrid approach. This has become a common approach in the past year with 83 percent of state and local respondents citing the importance of migrating to a hybrid cloud environment. A hybrid approach provides you to work with your current on-site systems and then find opportunities to modernize throughout the organization. Benefits of a hybrid approach include improved data availability, interoperability, flexibility, and cybersecurity.


Which one is best for my organization?

Now that you’ve gathered an understanding of the different types of deployment models, you may be wondering – which one should we move forward with? This will depend on your organization setup, goals, direction, and business model. It’s important to sit down and understand the criteria that are important to your organization, your staff, and your citizens. How will you use the software? What are the department’s plans? What is the core business need? Economic considerations and future scenario planning are also key factors in determining solution evaluations.

While a 2019 survey revealed 34% of IT leaders have a cloud migration strategy in place, another survey by the Center for Digital Government found that data mobility, security, and compliance were the biggest cloud migration challenges for state and local agencies. Funding and staff training are also challenges.

We suggest developing a comparison of advantages and disadvantages chart with criteria such as cost, control, security, user access, and other important considerations for your organization. Take a look at this table for inspiration.


Want to receive the latest news and trends in local government?
Sign up for our quarterly newsletter


Learn About Harris Cloud Services

With Harris’ hosting, backup, and recovery services you can improve access and security to your organization’s sensitive data. Plus, you’ll stay running even if affected by an internal server outage or data loss.