With Esker’s announcement to declare the DeliveryWare solution at end-of-life in 2023, the topic of “on-premise vs. cloud” is top of mind. While Esker’s focus is now mainly on cloud-based solutions, there are still plenty of organisations that rely on in-house server environments that don’t feel the need to change. Change can be hard! So, let me outline some cost-associated reasons to consider moving away from on-premise solutions. Some of these will be new to you or things you may have never thought of before, and some may be familiar. If you’ve already made the move, this blog is here to remind you (and give you a fist-bump) about why your decision was a smart one.
Before I share with you why moving to a cloud model makes more sense than investing in or retaining on-premise environments, I want to address two very common modern arguments in favour of the on-premise model.
First, let’s start with the one heard most often: “the cloud isn’t as secure as an on-premise environment.” This is a flat-out myth in 2020. It can be difficult for an organisation to give up control of any kind, especially when there are PHI and PII involved. However, nowadays most compliance frameworks are more cloud-friendly than they are on-premise friendly. Identity and access management services, data encryption options, regional configurations and data protection tools are all available in modern clouds, and thus extinguish the idea that the cloud isn’t secure.
The second one commonly heard is that there is latency in the cloud if not geographically proximate to end-users. While this one can be accurate for some companies, it is not even a whisper of a problem for Esker. Esker has seven data centers worldwide, and they all back each other up. Least-cost routing plays a big role in saving time and money for our clients. So, if the power goes out in your region, your Esker solution doesn’t go dark.
Now let’s take a look at why the cloud is superior to on-premise solutions, especially at Esker. As mentioned, these are all going to be associated with the cost of an on-premise model that you would not encounter in a cloud solution (like Esker).
- System hardware – While this is often presented as a one-time investment, it certainly is not. Not only do you have to update your servers every so often, but you also have to maintain what you have (likely on an annual basis).
- System software – Software will need to be continuously updated by your in-house team in order to not only work properly itself but also to coexist with other systems — often as a result of those other systems needing to be updating and reconfigured.
- Operational networking – On-premise environments cannot use regular old cables and modems. They use specialised, stronger connections that are much more expensive.
- Data recovery and backup – Since you are managing all of your hardware and software, you also have to back up your own data. That often requires you to buy a whole other server or multiple servers. The initial investment of servers tends to be the most expensive part of an on-premise solution, and those servers need to be maintained as well, accruing even more costs.
- Voltage management – You are responsible for the power that is required to run the datacenter your servers reside in (unless your servers are hosted off-site). Electricity bills can be exorbitant. Power outages can really put a damper on things …
- HVAC technology – The hardware and equipment you have in your data center has to be cooled, and it has to be done 24/7, 365 days a year. This definitely runs up the electricity bill as well.
- Workforce – You must have the right people in place to maintain the server room, machinery and operating systems. There is often more than one person that handles all of this, and their knowledge base generally doesn’t mean they have the lowest salary at the organisation either.
So, there you have it! Don’t let your fear of the unknown stop you from exploring the cloud. And don’t let anyone tell you that on-premise solutions are cheaper or more scalable than cloud solutions.
Joanna has been with Esker for nearly four years, in a few different capacities, but has spent the most time on the sales side of Esker. Currently, her expertise lies in Esker’s Procure-to-Pay solutions and moving current on-premise customers to the cloud, regardless of the solution. Outside of work, she enjoys spending time with her son, her dogs, and travelling with her family.