|Low upfront costs. Companies pay a subscription fee to ‘rent’ the software and users can access it right away.
|High upfront costs. Companies have to invest in their own servers and hardware infrastructure, plus have an internal or third-party IT team to set up and maintain the system.
|Users can log in securely from any device without access to the company network. Everyone involved in a project can have access to the latest data anytime, anywhere. This creates transparency and prevents misunderstandings. Perfect for remote working.
|Users can only access the software from local devices, like office computers, or with access to the company network.
|All data is stored in the cloud and can only be accessed with an internet connection.
|Local data storage means that data is accessible on-site even if the internet fails.
|Automatic software updates
|Yes. The provider is responsible for all software updates and security patches. Plus, SaaS software is constantly being developed so customers always work with the latest version.
|No. Companies are responsible for their own software updates. An in-house or third-party IT team is needed to plan and manage software updates, security patches and other maintenance, and to ensure these are carried out in a timely manner to keep the system operating safely.
|The provider is responsible for fixing any system outages or security breaches. Because they have to protect their customer’s data and their own reputation, SaaS providers tend to leverage large teams and the latest technology and resolve issues as quickly as possible.
|Companies are responsible for detecting and fixing any system outages or security breaches and getting the system back up and running. This can be handled by the in-house IT team or a third-party support contractor. How quickly issues are resolved can vary greatly depending on the severity of the incident and the experience, resources and capacity of the IT team.
|Scalability and flexibility
|Easy to scale due to flexible pricing models with short contracts. Subscriptions are usually based on usage, feature set or number of users with the option to upgrade for more space, users, features, etc. To downgrade, you might have to wait until the end of your current contract term.
|More difficult to scale as more effort is required by IT teams to plan, implement and oversee changes without interrupting business operations. Hard to move away from due to high upfront costs and long support and maintenance contracts. Can be cost-effective for extremely high-growth companies with an established on-premise system.
|Data security and backups
|Guaranteed by the software provider.
|Companies are responsible for their own backups and data security and need teams to do this.
|Modern and intuitive user interfaces that are easy to use. No learning curve, quick adoption.
|Depends on the user interface the company has built. But companies tend to update them less often because development work is expensive, so teams often make do with old interfaces that are clunky and difficult to navigate.
|Options are determined by the provider and, in most cases, customers pick and choose from a feature set. But most SaaS software is already designed to serve a specific industry or niche and will come with all the features you need. If you’re missing a function that the provider doesn’t offer, it’s usually easy to integrate with other systems.
|Highly customisable because 100% of the infrastructure is in the company’s hands. But companies have to invest in development and rigorous testing to add functionality. This makes on-premise attractive to companies with good budgets and large IT departments that need very specific functionality.
|Easy to connect to other tools, apps and software via open interfaces (API).
|Connecting to other tools is possible but every integration requires coding.
|Previously complex processes are automated. This accelerates internal workflows and saves a lot of time.
|Expensive to build, adjust and automate workflows so most companies stick with existing (often manual) processes.