Key Considerations for Cloud vs. On-Premise Evaluation

by: NebuLAW Team

Leading law firms are embracing new technology as a source of competitive advantage and a means to improving their margins. One of the key decisions firms need to make in this context is whether to persevere with the traditional on-premise IT set up or to move to the cloud.

In truth, many of the mainstay functional pillars of the legal practice are already in the cloud. But so long as you have critical software running on servers in your data room (or worse a cupboard in the kitchen) you have an anchor of legacy holding you back.

in this article we dive into the pros and cons of cloud vs on-premise solutions and unashamedly guide you in the direction of the cloud. 

What’s the Difference Between Cloud and On-Premise?

Historically, the software that supported a business ran on a server that was hidden away in a cupboard in the office. The business incurred costs for hardware, upkeep, software maintenance and security updates and dealt with multiple vendors. The business owner prayed silently that the backup and security measures were enough to keep client data safe and the IT architecture was robust enough to ensure business continuity.

When these businesses inevitably lost critical data they typically engaged professionals to manage their servers in secure, lockable, climate-controlled rooms. These specialist IT professionals handled all the security and hardware issues and kept the systems running.  Growing firms came to depend on these professionals because of their knowledge of the ever-evolving software ecosystems, licencing structures and increasingly complex hardware and server architectures.

Cloud computing has emerged as the alternative to this convoluted, expensive and risky “every man for himself” type server arrangement. 

In stark contrast to on-premise architectures, in a cloud solution servers are managed by centralised teams working on tens of thousands of similar servers and applying best in class security patches to keep them all up to date and functioning optimally. The scale economies enabled by cloud architectures has resulted in significant cost savings. And the cloud business model is typified by a simple monthly licencing fee that variabilises what were large and lumpy fixed costs, delivering a much lower total cost of ownership, a cost structure that changes dynamically as your firm grows or contracts, and an IT and systems architecture that is always up to date.

These servers will generally be local with redundancies scattered across the continent or, in some cases, the entire globe so the client can rest assured that data loss is no longer a concern. Likewise, the cloud provider takes care of maintenance, backups, software updates, power, and HVAC. The customer only needs to maintain its internet connection to access its systems. 

While this may sound intimidating, it’s really just the natural progression of a trend that has been underway for over a decade. Consider, for example, how many of the every day solutions are now entirely cloud-based: 

  • Website hosting
  • Email hosting
  • Office 365
  • Domain names
  • DNS
  • PEXA
  • Court forms
  • Phone systems
  • Internal collaboration (Slack, Teams etc.)

The idea of having all these systems hosted in the cloud ten years ago would have been enough to send most partners into cardiac arrest. Still, today these systems live harmoniously, hosted in the cloud, and they work without the involvement of local tech teams every time something goes down. 

Cloud security has historically been considered less robust than on-premise alternatives, but the cloud is no longer a lacklustre, new competitor. 

A company running its on-premise servers retains control over security. They are solely responsible for setting appropriate user access policies, installing firewalls and antivirus software, ensuring security patches are installed promptly, and guarding against data loss and cyberattacks. 

This degree of control can be something of a double-edged sword. For a business with appropriate IT support, on-premises solutions give companies confidence that their servers are locked down—they don’t need to trust another company with their private data. On the other hand, if mismanaged, on-premise servers can leave an organisation vulnerable to security threats.

Which Is More Secure?

In the cloud, data security is handled by the cloud provider and while it is theoretically possible to hack the cloud (as with any network), the truth is that the cloud has proven itself time and again to be the more reliable and secure choice for even the largest of businesses; 64% of enterprise networking companies maintain that cloud infrastructure is a more secure data solution than legacy systems

Amongst its peers, Salesforce is known as the most secure platform; in fact, it holds certifications of compliance with several international safety standards, including (but not limited to) PCI DSS, FISMA, ISO/IEC 27001:2005, SAS 70 Type II, EU-US and Swiss-US Safe Harbour

If security is your concern, the cloud wins this argument hands down as the most secure place for you to store your data, and when it comes to the cloud, no platform is better protected than Salesforce; this is why NebuLAW has chosen this platform as our primary partner. 

Key Benefits of Cloud Vs. On-Premise

Aside from security, many other factors go into the on-premises vs. cloud decision:

Total Cost of Ownership

Upfront investment and large fixed costs is the name of the game with on-premises systems; you’ll need to purchase hardware and employ people to maintain software licences and deal with hardware issues. Running these servers also requires significant expenditure for cooling and electricity. As hardware reaches the end of life every three years, repair and replacement costs arise. 

For cloud users, the only cost is a simple monthly fee.

Often people consider the baseline cost, the minimum level of serviceability – what’s the lowest cost server we require to run this software? But this is a false economy. Your people won’t be happy with the slowest, cheapest service, and you need to consider the impact on fee earner productivity of the cheapest machine. And three years is three technology generations, by the time you’re ready to replace your hardware, the new age gear will be 2-3x faster. With a cloud solution you’ll always have the fastest, most optimised system at your disposal without ever needing to update or upgrade your systems.

Uptime, Downtime, and Everything in Between

We all want maximum uptime, after all time is money; there’s nothing worse than having fee earners twiddling their thumbs while a glitch in the matrix is resolved. 

Even cloud servers have downtime but that downtime will typically be scheduled ahead of time and occur outside of business hours; real outages are such a rarity that it’s featured in news bulletins across the globeThe fact that it’s so newsworthy illustrates just how reliable these services have become. 

Once your systems are cloud-based, they’re accessible anywhere, anytime you have an internet connection, and your internet connection becomes the only real failure point. Contrast this with the myriad of failure points inherent in the typical on-premise system. 

Scalability; Does Your Software Grow and Contract Dynamically?

If your firm is running on local servers and you need to onboard new staff, you’ll often require an entire re-model of your servers and infrastructure. In addition to the very real hardware costs this entails, the professional services to enact these changes can be quite expensive. If your needs later contract to previous levels, you remain saddled with excess capacity. 

The cloud is much more scalable. Data centres allocate computing resources to meet demand at any given moment, providing you with the correct amount of processing power, storage and resources required for the number of users and the work they are doing. All this happens seamlessly; you’ll never need to trouble yourself with the details. 

Conclusion

From a functional point of view, there’s no clear winner in this debate; arguments can be made for either system. However, if your goal is to run a law firm with as few distractions and drama as possible, with the most up to date technology and with the best possible cost structure, then the answer at this point should be quite clear. While many firms are running hybrid systems, using the cloud for some services while keeping others in the house, the leading firms are all moving to completely retire their on-premise systems. 

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