Premise Versus the Cloud: Making an Informed Decision

There are a number of considerations when determining where to run an application.  In today’s market, we are flooded with solutions that claim they are the best.  However, in reality, what may be good for one organization, may not be for another.  The following framework is designed to help you decide whether you should run an application at your premise or at a cloud provider’s facility. This analysis is designed to identify the merits of moving a single application to the cloud versus running it on premise. If you are inclined to move all of your IT and telecommunications applications to the cloud, this becomes an analysis requiring a different and more complex approach.  Reviewing the following areas is recommended before deciding to keep your applications on-premise or in the cloud.

Recommended Areas of Analysis

  • Financial Assessment
  • System Security Review
  • Organizational Fit
  • Scalability/Flexibility Requirements
  • Residual Considerations

Financial Assessment

A Digicorp comparative financial analysis reviews the one-time costs and perpetual costs for each alternative (premise vs. cloud) using a 5 year cost of ownership. This analysis also applies the time value cost of money. The cost variables typically considered for this assessment include:

  • Equipment costs
  • One-time license costs
  • Annual equipment and license support costs
  • Projected labor support costs
  • Monthly/annualized cloud costs
  • Carrier/circuit costs
  • Projected one-time labor costs

For most organizations the cost of a solution matters. This approach provides an accurate comparative assessment.

System Security

Both the premise and cloud based solutions will be reviewed to determine the security risk associated to the system infrastructure, application and data.

Organizational Fit

This analysis reviews how and where applications are used by your staff as well as third parties. It seeks to understand whether the organizational usage is centralized in a few locations or highly distributed. This analysis also seeks to understand the organizations culture and how they will best be served.

Scalability/Flexibility

Organizations and applications all require a level of flexibility and scalability. This analysis assesses the requirements in this area.

Residual Considerations

What you decide today may have an impact on what you can do in the future. In a simple statement, how easy is it for you to move your application and data from one approach to another?

Summary

Contrary to marketing spin, there is not a single best solution for all organizations. For those considering the deployment of an IT or telecommunications application, this framework will provide a non- subjective review of whether the cloud or premise is a preferred approach.  At Digicorp, we have a team that is dedicated to helping you choose a solution that fits both your need and budget.  With over 20 engineers and 40+ staff, we offer insight into how and where an application should be implemented to best fit your needs. 

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