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Choosing the Right CRM Type for Your Business, Part II: Cloud CRMs vs On-Premise CRMs

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Following the previous part of our blog series covering the open-source and proprietary types of CRMs, in today’s post we’ll discuss two popular software hosting options to help you reach your final decision on the most appropriate CRM type for your business.

Both cloud (your database is hosted externally on your provider’s servers) and on-premise (database is kept ‘in house’ setup on your company’s servers) deployments of  CRM applications have their benefits and shortcomings.   

The Pros

Pros for Cloud CRMs

Immediate availability and high mobility

The straightforward advantages of a cloud CRM become apparent once you need to set it up quickly since you are able to immediately use the application. You can also access your data from literally anywhere as long as you have Internet connection.

Default backups

You don’t have to worry about operating data backups, as these will be done for you by the service provider. You just want to make sure your provider has them and you are OK with their cadence.

Low cost

Typically, companies don’t have to invest almost anything into infrastructure and maintenance of their cloud-based CRM solution, as cloud has very low maintenance costs.

Pros for On-Premise CRMs

Greater control over sensitive data

You run on-premise CRM application using own hardware being managed in-house. Which means, you have a greater control over the database and you know exactly who has the access to it, ensuring higher information confidentiality.

On-demand backups

You can perform data backups whenever it suits you, not based on the policies or availability of the hosting service provider.

Offline availability

Once you adopt an autonomous CRM software, you can anytime access all the data offline regardless of Internet connectivity.

The Cons

Cons for Cloud CRMs

Dependence on Internet service

For business running their CRM applications in the cloud, it’s mission-critical to have a consistent Internet access. They completely depend on trouble-free connectivity, high connection speed, and a good amount of  bandwidth.

Data migration

Sometimes, due to the compatibility issues between various operating systems or products, the migration of data to, from, or between cloud services can be not as smooth if at all possible.

Cons for On-Premise CRMs

Up-front costs

Not every company, especially startups, can spend money to finance software licenses, hardware to host the CRM and technical staff to maintain the servers.

Server maintenance and limited storage

When you host all the data on an internal server, you have to deal with its storage capacity. Once you run short of the limited storage space, you’ll need to purchase supplementary hardware to store further data, and perhaps hire more tech support to manage new servers.

Summing Up: Going Cloud or On-Premise?

Cloud-based CRM is an ideal solution for startups and small businesses that may have constrained budgets. Companies with multinational teams scattered around the world will also leverage the cloud CRM advantages. There’s no need to implement anything, just go to the cloud and start you work immediately. Organizations using the cloud-based software don’t have to invest in additional personnel as most of the maintenance and setup is conducted by the vendor.

On-premise CRM systems are a perfect match for established large businesses with more complex business needs and in-house IT infrastructure requirements.

At the end of the day, the right choice of a CRM solution boils down to understanding how this particular type of software with its attributes and capabilities, be it open-source, proprietary, cloud- or on-premise, will fit into your own business.

The Community and Enterprise editions of OroCRM, one of the most flexible open-source applications the market has to offer, are available both in the cloud and on-premise. By delivering our product versions as two different distribution models, we accommodate the interests of small companies (Community edition), as well as midsize and enterprise organizations (Enterprise edition).
Get in touch with our consultants to find out which OroCRM version and distribution model will fit best into your own infrastructure and cater to the business needs of your organization!