Outsourcing CRM Software Service Gives You A Better Understanding: On-Premise CRM vs Cloud CRM

Glad that you are able to recognize the value in CRM (customer resource management) and have decided to invest in a CRM software system for your business.  But you are facing a difficulty in making decision – choosing between an on-premise CRM software solution or going ahead with a cloud version.

image courtesy:https://blog.hubspot.com/sales/benefits-crm-system

When deciding between a cloud vs. on-premise CRM delivery model, it’s important to bear in mind there’s no one-model-fits-all solution. There are advantages and disadvantages to both, and the decision usually involves a compromise. Start by first identifying and assessing your business’s unique CRM requirements. Ask yourself the following questions:

• Do your business have the financial capacity to invest in new resources such as required infrastructure, software licensing, support, etc.?
• Do you have technical know-how or a dedicated IT staff?
• How important it is to maintain confidentiality and control over your corporate information?
• How do you anticipate your business growing and changing over time?
• How much flexibility do you require?

Basics Of Cloud CRM Software And On-premise CRM Software

In a cloud or hosted CRM delivery model, your vendor houses the application and you access your data via the web. Alternately, on-premise CRM software is installed on your own servers and controlled and maintained in-house. But which is the best option for your business?

In order to understand  which CRM Solution will be the best for your business, below are few important questions that helps you to figure out:

• Does your company have required IT support to administrate an on-premise CRM?
• What about your security requirements, both of your accessibility and of the data itself?
• Does the cost per head method calculate works in your favor?
• Do you want to integrate your CRM with other enterprise solutions?

On-Premise Vs Cloud CRM Solutions Compared

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On-Premise Cloud

For organizations that want to utilize existing IT infrastructure or fully control the CRM database from their own servers, including its upgrade cadence

Retaining complete control of data is one reason why businesses choose an on premise installed CRM solution over cloud CRM. This is especially important to organizations with sensitive client data including legal and financial businesses.

In comparison to the recurring monthly cost of cloud CRM, businesses that have already invested in an IT infrastructure may calculate that an on-premise package which creates a lower total cost of ownership over longer term.

Benefits To Choose On Premise CRM

• Utilizing existing IT investments
• Retaining ownership of customer data including CRM upgrade
• Decreased immediately increased monthly costs if there is increase in CRM license 
• Utilizing in house personnel or outsourced IT resources who will manage CRM
• Less susceptible to potential external connectivity issues
• The software runs on your own hardware and is managed internally.
• Greater control over data processes and confidential information.
• Dedicated IT staff for system support.
• Flexibility to determine when you want to upgrade your system.

Cloud CRM

Your secure data resides in cloud with CRM as a service with lower up front expense. Unlike an on-premise application a Cloud CRM solution isn’t purchased outright or owned by you. Rather like renting you don’t pay an upfront cost to purchase but instead pay a monthly subscription to use the service. This will also include all CRM upgrades and service updates.

Benefits To Choose Cloud CRM

• Removes the overhead of purchasing and maintaining a dedicated CRM server
• Lower upfront expense as it avoids software license costs
• Enables CRM to be deployed quicker compared to an on-premise implementation
• Only pay for what you use; increase and reduce subscriptions when needed
• No new hardware or IT infrastructure required.
• Low monthly cost for services
• Easy set-up.

After considering both cloud vs. on-premise CRM options, with the above mentioned pros and cons of both you can see why it is important to evaluate your unique business needs. However; the cost is an obvious consideration, it’s essential to look beyond cost at what makes the most sense for your business. 

Closing Thoughts

Want the most amount of flexibility? Since there are pros and cons to both CRM delivery models, in many cases it’s advantageous to consider a vendor that offers both a hosted and on-premise software solution. That way you can easily switch from a hosted to an on-premise CRM platform as your needs evolve and change over time.

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