A piece of cake – how to buy cloud vs. on premise

By Peter Gergely, SAP Solution Architect, Oxygen on

If you crave cake, there are two ways to get it; go into a cake shop and buy what is on offer, or bake one yourself. Both will, hopefully, provide you with a delicious outcome – each with its own unique qualities. However, depending on which approach you opt for, the journey to the dessert table is different. The same could be said for choosing between cloud and on premise software solutions.

If you decide to buy your cake there are several obvious decisions to make. What flavour do you prefer? How much cake do you need? Armed with this information you will probably research a few cake shops, find one you prefer based on quality and price, and then visit the shop to inspect the cakes on offer. You will then choose the most appropriate one and, to give you confidence in your purchase, you might even be able to ask for a small taste in advance. To some degree you will have to buy what is available in the market and you will probably have to accept that not everything is in your control.

If you bake the cake, you must first decide exactly what type of cake you want. You need to find the right recipe, have your shopping list ready to go and do the arithmetic on how much you have to spend. You need to have a plan on what tasks you will do and be confident that you know how to do them. You need to know your kitchen is equipped and oven is up to the task before you get baking.

Deciding between cloud and on premise software is not dissimilar. When buying a cloud product, you must know what your key pain points are, what products are on the market that address your core businesses processes, and choose an implementation partner you trust. It might be a good idea to do a high-level fit to standard analysis to verify your broad requirements will be met by the product. Because cloud products are based on best practice processes and the implementations are standardised, you probably just need to look at some key areas, such as integration requirements, to work out the price. You can be confident the implementation of the core cloud functionality is predictable without needing to dig into a high level of detail. With the right process and a bit of tyre kicking with free trials or demos, you should be able to choose a suitable product, without an expensive RFP exercise.

Buying on premise is entirely different. You will need to gather your requirements in detail, ensure that you choose the right product and the right partner to implement it, not just based on reputation but on proven experience and cultural fit. As the solution will be tailored to your needs, pricing will have to be worked out in detail – from infrastructure and bill of materials, right through to the implementation effort – and a comprehensive timeline will have to be developed for the project. This certainly makes a more detailed purchasing approach necessary.

Knowing what you want to achieve – cloud vs on premise - is the starting point. With that goal in sight, deciding on the right purchasing approach is a piece of cake.

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