CRM or ERP SaaS Solution vs On-premise: The Pros and Cons
The on-premise vs SaaS solution debate is always one that stirs up a lot of differing opinions and arguments. And, now that there are SaaS solutions for Enterprise resource planning (ERP) and Customer Relationship Management (CRM) systems, the topic has become even more hotly debated.
SaaS solutions offer many benefits. Nevertheless, arguments against these solutions still persist. When it comes to making decisions on ERP and CRM, you need to have all the correct information, so you can do the right thing for your organization. As such, both sides of the on-premise vs SaaS solution debate are important for you to consider.
In this article, we detail the pros and cons of on-premise vs Saas solutions, for ERP and CRM systems. This should help you to decide which is best is best for you and your business.
Before we dig into the on-premise vs Saas solution debate, we should give you a quick explanation of ERP and CRM to show why making the right decision about which architecture to use is so important.
ERP is essentially software that allows organizations to manage their everyday operations, including accounting, procurement, risk management and compliance, supply chain management, and project management. Some ERP systems also include human resources management, e-commerce, and content management systems. Basically, ERP is a collective database for every section of a business.
It is a system that grew out of material requirements planning, which was how manufacturers controlled all their required resources so that their businesses could operate optimally.
Often, ERP focuses on the financial aspects of a business and includes finance reports, accounts payable, and other such information. However, increasingly, it is being extended - as explained above - to include various other aspects of a business.
Having an ERP system means that companies are able to easily report on any aspect of the business, as all financial and operational data can easily be found and accessed on the system. It also means that data for analysis is readily available so that decisions can be made quickly and efficiently. Furthermore, ERP systems generally allow for greater control of information within an organization.
What is CRM?
CRM is simply software that controls the way in which a customer engages with an organization. Included in CRM systems are features such as customer service interactions (hotline), management, marketing, sales performance management, and so forth.
The general idea of having software that controls all of these aspects of customer relations is to ensure that all customer data can be tracked and kept in one space. Since all of the data is collected in one system, it is easy to analyze when business decisions related to customers need to be made.
For example, a CRM system allows a business to know when to pursue leads to make more sales, they have insight into the performance of their sales teams, and they can keep track of any customer queries that are yet to be dealt with. This ensures that relationships with customers are always kept strong, and customers are always taken care of, which is great for your business’s reputation.
Some organizations may only need ERP systems and others may only require CRM systems, but often, businesses need both. And, under these circumstances, it is usually the case the ERP and CRM systems need to be integrated, as data needs to be shared.
This can be a highly complicated process. However, if you have software that does both - such as the web suite offered by Dolibarr - the solution becomes much simpler.
The Importance Of ERP and CRM
As you can see, ERP and CRM can play a massive role in the success and growth of your organization. For this reason, you must make an educated decision around the on-premise vs SaaS solution debate.
Once you’re clued in on the advantages and disadvantages of both a SaaS solution and an on-premise option, you can determine which will be a better fit for your needs.
Your ERM and CRM can be facilitated using either an on-premise or a SaaS solution (it can also be held on a cloud-based solution, however, we will not discuss that here). So what is the difference between on-premise and Saas solutions?
On-premise solutions require organizations to be liable for building up and organizing both the hard and software components of the solution. On the other hand, if organizations opt for the Saas solution, the vendor will host the software on their servers and will ensure that it is maintained and updated at all times.
To help you further understand whether an on-premise solution or a Saas solution is better for your ERM and CRM, and for your business as a whole, let’s compare the two, and look at the pros and cons of each.
When it comes to the implementation of the solutions, the Saas option comes out on top, as it can be implemented much faster than an on-premise option.
When an organization signs up to use a Saas solution, they can start using it almost immediately, because the platform is ready-made or is already in existence, and it has already been tested. In contrast, an on-premise solution takes much longer to get up and running, because it needs to be set up in-house (which requires extra time, personnel, money, and equipment).
With Saas solutions, organizations have very little to worry about when it comes to maintenance, support, back-ups of information, or upgrades. In general, this is all taken care of by the provider.
When you use an on-premise solution, your business must take care of all of these things on its own. This can be difficult, and it will require that organizations have the staff, resources, and time available to ensure that all of these processes are completed well.
In terms of these specific factors, many feel like on-premise solutions are better. Often, those who make use of saas solutions feel as though they do not have as much control over the software as they would like to have, and this is not the case with on-premise solutions.
Furthermore, with on-premise solutions, ownership of everything including hardware, software, and data is in the hands of the organization. On the other hand, with saas solutions, the software is owned by the provider and this leaves data ownership in a grey area.
There are two sides to the accessibility coin for both Saas and on-premise solutions.
With Saas solutions, users use the internet to access systems. An advantage of this is that there is the availability of remote access to systems, which means people can work from anywhere. However, the downside is that if you do not have internet access, or if the internet goes down, you’ll be in trouble as your data will be inaccessible.
Alternatively, with on-premise solutions, there is no requirement for internet access, as the software will often only be accessible from inside the company’s network. This means that it makes no difference if the internet is available or not, which is an advantage. However, it also means that there is no availability of remote access, which can be an issue for many.
When it comes to overall costs there are again pros and cons to both Saas and on-premise solutions. The Saas option has a significantly lower entry cost, and total ownership cost, as organizations are not required to pay for licenses, hardware, or software. However, you will have to continue paying a subscription fee for as long as you use it, and this could turn out to be more expensive in the long run.
However, it is worth keeping in mind that with Saas options, update costs are lower, and organizations do not need to take care of internal resources, nor do they need a dedicated IT support team.
With on-premise solutions, the entry cost is much higher, as organizations need to obtain hardware, software, and support staff when they get started. Thereafter, however, maintenance costs will be lower and the hardware can be added to the business’s assets.
Another factor in which on-premise is better is with integrations (i.e integrating different applications or sharing information between different databases). Here, using on-premise solutions is much easier, as data can be transferred between systems using the intranet. With the Saas solutions, integrations with other systems can be very complex, as data transfers have to be done using the internet.
One of the best advantages that come with using a Saas solution is that the security is good. Organizations won’t have to worry about it, as the vendor will take care of network and server security. With an on-premise solution, however, you’ll have to acquire your own software for security, which in turn increases the cost and manpower that is needed overall.
In general, validation is done by the saas provider, and ensuring that regulatory requirements are complied with is easier with the saas option.
With the on-premise option, your IT staff will have to take care of validation. In addition, they will be responsible for ensuring that regulatory requirements are fulfilled. It should be noted, however, that it may be relatively easy to ensure that regulations are complied with since, with the on-premise solution, the organization will have total control over the software, infrastructure, and environment.
To Summarize On-premise Vs Cloud
To make all of this information a bit more digestible for you, so that you can make your decision about SaaS solutions vs on-premise systems with a clear view of what you are choosing, we have constructed a useful table.
Since Dolibarr offers both options, you won’t have to look far to find the option that suits you best. Nevertheless, this list should make it easier for you to decide if you want an on-premise or Saas solution for your ERP and CRM.
Both options come with practical pros and cons, however, some organizations may be less affected by certain cons. For example, if you have a large organization, a higher cost of entry will not be too much of a problem, and then you’ll have the advantage of owning the software. Decide which cons you are willing to deal with, and then it’ll be easier to decide if you want to use an on-premise or a Saas solution with Dolibarr.
A SaaS ERP or CRM solution Vs. On-Premise: Which Should You Choose?
Deciding on whether you should use the SaaS solution or on-premise version of Dolibarr ERP and CRM software is an important part of your organization’s IT strategy. But, making a choice between the two requires you to take a variety of factors into consideration.
Looking at your budget, your tech support, your need for remote access, and the availability of back-up, are all important factors when it comes to making this decision. In the end, there is no correct answer. You can choose whichever option fits your organization’s needs and interests the best. Just ensure that you have carefully thought about the pros and cons of both options, before choosing one.
Either way, Dolibarr’s offerings will be sufficient to ensure that all your business needs are catered for.
Dolibarr ERP and CRM is Open Source software. You can download, use and redistribute it at any time. Do you want to test the latest version of Dolibarr?