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Posted by John Kleeman

In an earlier post, I explained 6 reasons why the Cloud is usually better for deploying talent management software.

These were:

  1. On-demand gives you access to innovation and use of mobile devices
  2. Deployment is easier with on-demand and allows quick pilots
  3. On-demand requires less corporate IT bandwidth
  4. You don’t need to worry about scalability with On-demand
  5. On-demand is easier to make secure
  6. On-demand is usually more reliable

We offer the on-premise Questionmark Perception as well as Questionmark OnDemand, our SaaS solution, so I have no “axe to grind”.

It’s important to consider all the angles when deciding between on-demand and on-premise — so now I’d like to identify 4 reasons why on-premise can be better:

1. Data protection is simpler if everything is in house

What are some of the reasons against on-demand deployment? One is data protection.
With an on-premise installation, you have full control of your own data protection.

With an on-demand installation, you need to ensure that you keep control of your data and that the Cloud provider responsibly processes it. Most reputable providers do a good job on data protection, so you can usually resolve this concern, but you do need to stay in control and be vigilant when using a network of data with different providers.

2. The US Patriot Act can be a concern for non-US organizations

Usually an organization will be reasonably confident that data in an on-premise system should be inaccessible by governments or other outside parties, at least without a legal process. But there is concern a government might force an on-demand provider to share data without the organization’s permission.

In particular, the US Patriot Act gives the US government the right to demand data from a US provider. If an organization is concerned about this, it would want to use an on-demand provider that is not US-owned, whose data center is outside the US and is not owned by a US company.  (Questionmark has a European data center for exactly this reason.)

3. There is less risk of lock-in with on-premise

Technology and suppliers and needs change, and every organization needs to be able to plan to move systems in the future. For both on-premise and on-demand, you need to make sure that your data is accessible in a documented format. But for on-demand, you also need to make sure that your contract permits you to get access to the data and export it or otherwise access the data to avoid lock-in.

4. You can customize on-premise

Picture of software development from Wikipedia (http://en.wikipedia.org/wiki/File:Coding_Shots_Annual_Plan_high_res-5.jpg)Typically you can configure an on-demand system and set up your own templates and branding, but major customization is harder. Most on-demand providers use the same software instance for all their customers; this is one of the key economies of scale that make on-demand successful.

An on-premise installation is much easier to customize, so a strong reason to go on-premise can be to do deep customization. For instance, you can usually access data via web services in the Cloud, but if you need direct database access or connections, you may need to go on-premise.

Of course, if you do customize, too wide a change can make things difficult when a new version of the software is produced. This goes back to the first reason on my list of arguments in favour of on-demand: it gives you easier access to new versions and innovation.

 Of course, other factors come into play as well – functionality, cost, support, and organization culture to name a few. Both routes are viable. There are advantages for on-demand services, but some organizations prefer on-premise installations for good reason.

If you’re trying to decide what’s right for you, I hope both of these posts (part 1 is here) help highlight some of the issues.