Cloud vs. On-Premise EHS Software: The Costs, Benefits, and Risks

When choosing EHS software, one of the most important decisions you'll make is whether to go with cloud-based or on-premise software. 

In this article, we'll take a look at the difference between cloud and on-premise software and compare the pros and cons of each solution.

By the time you reach the bottom of the page, you'll be equipped to decide which type of solution is right for your company. 

The difference between cloud and on-premise EHS software

The biggest difference between cloud and on-premise EHS software is where they reside.

Cloud-based software is hosted on a third-party provider's server. You access both the software and your data via the internet. Cloud-based software is closely related to SaaS. Some examples of cloud software include:

  • Google Docs
  • Office 365
  • Dropbox

On-premise software is installed directly on a company's own computers and servers. Some examples of on-premise software include:

  • Microsoft Office (traditional desktop software)
  • Homegrown software systems

But the difference between cloud and on-premise software goes beyond where it is physically located. Let's take a look at the pros and cons of each option.

On-premise software

Before cloud computing, companies had to host software on their own computers and servers. You paid for a license for each user and installed the software on all your company's computers using a CD. Then, you could access your data on that computer.

One of the main reasons companies have moved away from traditional on-premise software is cost. There's a huge upfront cost involved in purchasing software licenses, server hardware, lab space, and IT staff. Then there's the ongoing cost of maintaining all that infrastructure. 

Another reason companies have moved away from on-premise software is that it can take a long time to install the software on the company's servers and computers. 

While most companies are moving toward cloud computing, there are a few reasons you might choose to stick with on-premise software. 

Pros of on-premise software

  • Complete control over maintenance and updates
  • If your industry has specific IT governance or compliance regulations that must be met, using on-site servers can simplify this process and allow you to assume the risk yourself

Cons of on-premise software

  • High upfront cost of purchasing hardware and software

  • Ongoing maintenance costs can drain your budget

  • Slow deployment since software has to be installed on servers and individual computers
  • Security risks if you don't have adequate IT security resources
  • Limited access to software and data on the go

Cloud-Based Software

On the other hand, cloud software providers own and maintain the infrastructure and store your data on their servers. 

With cloud software, you can access your data from anywhere you have an internet connection -- at the office, at home, or on an airplane -- and from any device. This is especially advantageous for EHS departments, since audits and inspections can be performed remotely rather than traveling to each location. 

As you might expect, cloud software is almost always cheaper than on-premise. Instead of being an upfront capital cost, the monthly or annual fee for accessing the software is considered an operating cost. 

Because your software provider handles maintenance and updates, you won't run into unexpected maintenance costs and you're able to free up your IT staff for more valuable tasks. 

Pros of cloud-based software

  • Lower cost since there is no hardware to purchase and maintain
  • Easier access from anywhere you have WiFi
  • Quick deployment since the software is accessed over the internet rather than installed on servers and individual computers 
  • Better security than most mid-sized companies could afford on their own
  • Ongoing maintenance and updates included with your monthly or annual fee, which means you always have the most up-to-date version 

Cons of cloud-based software

  • Less customizable than a homegrown software system
  • Requires an internet connection in order to access your data 

Is cloud software really secure?

Although most of us use cloud software everyday, some people still mistakenly believe that their data is safer on-premise than "in the cloud". 

This is a bit like believing that your cash is safer under a mattress than in a bank. Most homeowners simply can't afford the level of security and protection that a bank can offer. 

Likewise, most mid-sized companies simply don't have the resources to provide the level of security that reputable software providers can offer. 

>>> Want to learn more about software security? Check out this article on common software security risks and how to avoid them

Which software is right for your company?

Choosing between cloud-based vs on-premise software is an important decision. In general, cloud based software is the most cost-effective and secure solution for mid-size organizations. Of course, there are many other considerations when selecting new software. To learn more about how to choose the right type of solution, download our free guide "Homegrown Vs. Off-The-Shelf EHS Software: Pros, Cons, and Finding the Right Fit". 

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