Cloud vs. On-Premise CRM: Which Is Best for Your Organization?

November 1, 2022

Customer relationship management (CRM) refers to the process companies use to administer interactions and relationships they have with customers. There are many CRM software and hardware options available today, and among these options, there is an ongoing debate about whether to implement cloud-based or on-premise systems. Let’s take a deeper look at whether cloud or on-premise CRM implementation is better for your company.

Cloud vs. On-Premise CRM Implementation: Which Is Best for Your Organization?

Cloud CRM System Characteristics

Cloud-based CRM systems typically use the software as a service (SaaS) model, where a company pays a subscription fee to a software provider for access to its CRM software. This means your company data is stored online rather than using an on-site server, and users access the data they need through the internet. Cloud-based solutions are often designed with integration features that make them easy to blend with existing software and platforms.

Cloud CRM is typically less expensive as the provider manages all updates, backups, and maintenance. You won’t have to pay for expensive equipment, and plans can be scaled according to your budget. Another benefit is your team members can work from any location with an internet connection, providing great flexibility for today’s mobile workforce. Since everything is online, you’ll always be working with the most current versions of all documents.

On-Premise CRM System Characteristics

On-premise CRM requires on-site hardware and servers to store and provide access to company data. Software is installed either on the servers or on individual user machines, meaning the system can function without an internet connection. With the on-premise model, companies typically purchase a license that gives them ownership of the CRM software. This means it can be customized to suit the unique operational needs of each business.    

Since on-premise CRM is completely contained offline, there are some inherent security advantages. This is particularly true when it comes to system updates and maintenance, as performing these offline avoids the threat of bugs and cyber attacks. On-premise CRM does, however, require a company to perform frequent backups to a physical server to avoid potential data loss.

Comparing Cloud vs. CRM

When it comes to deciding between cloud-based and on-premise CRM, it mostly comes down to three factors: cost, customization, and security. Other key variables include the size of your organization, whether or not you have remote employees, and how vulnerable your company is to cyber threats. Large companies, for instance, are sometimes more concerned with maintaining internal control of potentially sensitive data, which favors on-premise CRM.

Purely on a cost basis, Cloud CRM systems are typically less expensive, as they charge on a per-user basis that can be scaled up or down as your company evolves. You’ll also avoid the personnel costs associated with maintaining IT personnel to manage servers and system infrastructure.

These are some of the factors that will help determine whether cloud-based or on-site CRM is a better fit for your organization. Contact Project Genetics to learn how we can help implement CRM and other solutions to help maximize your company’s potential.

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