Pros and cons of cloud-based and on-premise CMMS software

There are hundreds of options for CMMS software, but they can all be separated into two groups: Cloud-based CMMS and on-premise CMMS.

Both categories help you manage maintenance, but that’s where the similarities end. Each option is very different, from the way the CMMS is implemented to the way it’s used to complete tasks. Knowing the pros and cons of cloud-based and on-premise software will help you avoid wasting time and money on a poor fit, and allow your maintenance team to hit the ground running.

What is cloud-based CMMS software?

Simply put, cloud software gives you the ability to store and access information on the internet. If you’ve used Netflix to watch a movie or Zoom to have a meeting, you’ve used cloud software.

Think about the cloud like a bank. Your money is not tied to one, physical location. You can deposit money at one branch and take that money out at any other branch. You can withdraw from an ATM or tap your credit card to make a transaction. Cloud software works the same way—just replace money with information. You can input information on one device and access it on any other device as long as it’s connected to the internet.

Now, let’s explore what the cloud means for managing maintenance. A cloud-based CMMS has a few key ingredients:

• Software and hardware requirements: All software and hardware is developed, installed, run, managed, and maintained by a third-party provider. An internet connection is needed to use the software.
• Installation and maintenance: Providers host the software on their own servers, which means they take care of all installation, management, data security, and upgrades.
• System access: The features of cloud-based CMMS software can be accessed anywhere, at any time, across different sites through the internet. Some systems can even be used if you lose internet connection for an hour or two.
• Mobile capabilities: Many cloud-based systems have their own mobile CMMS apps and can be accessed through mobile devices.
• Pay structure: Most cloud-based CMMS software is purchased on a subscription model with little to no up-front costs. It is priced per user, per month and includes support fees.

What is on-premise CMMS software?

On-premise software is software that needs to be installed on a computer or network. The software, and all the information created with it, is tied to the physical devices where it’s installed. One of the most popular examples of on-premise software is Microsoft Word.

How does on-premise software translate to maintenance management? Here a few basic traits of on-premise CMMS software:

• Software and hardware requirements: All required hardware, like servers, is housed on-site. The software typically requires extensive custom set-ups by a provider, contractor, or in-house personnel.
• Installation and maintenance: Set-up of the software and hardware is usually done in-house with limited external support or by a vendor for a high cost. Your company is responsible for data security and storage as well as any upgrades to the software.
• System access: Accessing on-premise software requires users to be on-site and connected to the same network as the CMMS.
• Mobile capabilities: On-premise CMMS software offers very limited mobile capability and most have none at all.
• Pay structure: Companies usually pay a one-time, up-front cost to use the software.

Pros and cons of cloud vs on-premise CMMS software

There’s no right or wrong when it comes to picking between a cloud-based and on-premise CMMS. Each facility has its own goals, expertise, and budget. Considering each kind of software from all angles is the only way to make the right choice for your business.

Cost

Cost is a big factor when choosing a CMMS. There are three kinds of costs to keep an eye on when weighing your options:

• • Upfront costs: Upfront costs include license fees, customization, installation, and integration.
  • Recurring costs: Recurring costs include subscription fees, support services, and system maintenance (ie. updates and upgrades).
  • Additional costs: Additional costs include training, data migration, IT personnel, and hardware (like servers).

On-premise CMMS

The up-front costs of on-premise software sound attractive. You bite the bullet, pay the money, and never think about it again. But there are more ongoing costs than it appears.

Because all hardware is managed by the business, you’re paying someone (or multiple people) to maintain that hardware. If something breaks, you have to fix it, which costs money and time.

The outlook for on-premise software gets worse a few years down the road. Like any piece of equipment, the performance of on-premise software degrades over time, which means replacing it every few years, which is expensive and disruptive.

Cloud-based CMMS

Most cloud-based systems require you to pay a monthly or yearly subscription fee for every user, reducing start-up costs. The difference is magnified if you’re migrating data to your new CMMS, which is easier and less expensive on a cloud-based CMMS.

A cloud-based CMMS is updated by the vendor. Updates are automatically added to the software without additional costs so you don’t spend money maintaining the system’s hardware. Your subscription fees may increase slightly every year to cover improvements, but the increase is slight ($10 to $20) because the cost is shared by hundreds or thousands of others.

The bottom line

On-premise maintenance software will cost your company more in the short-term and long-term due to its large licensing fees, the ongoing cost to maintain the system, and the need to replace or upgrade the entire CMMS every few years.

Features, functionality, and connectivity

While a CMMS must have the features you need to achieve your maintenance goals, there are other factors to consider when comparing cloud-based and on-premise software.

• Number of features: Both types of CMMS have a similar range of features, but cloud-based providers release new ones more often. The features on a cloud-based CMMS depend on the subscription tier you purchase.
• Customization: On-premise software is highly customizable when installed, but difficult to change later. Cloud-based software features are set, but their components are easier to change and customize.
• Ease of use: Cloud-based CMMS software is designed for a broad range of users, making it easy to pick the most relevant features for a job and do it with fewer clicks.
• Mobile capabilities: Most cloud-based systems have mobile apps accessible with login credentials and an internet connection, making it a more mobile-friendly option.
• Ease of integration: Cloud-based systems are more open, which means it takes less effort, time, and money to connect to new machines, software, or sensors.

On-premise CMMS

Almost all CMMS providers offer very similar feature sets with two big exceptions: Integrations and AI.

The ability for your CMMS to integrate with other systems, like an ERP or MES, allows you to collect and share information across your business. These connections save you time and money through automated work and data accuracy. On-premise systems are far behind cloud-based software here.

An on-premise CMMS is built as a closed-off system, meaning it doesn’t communicate well with other software. This creates problems like logging information multiple times and not being able to trigger work on your CMMS. Making connections between other systems and an on-premise CMMS is possible, but it’s a custom job, which is another word for pricey and complicated.

The closed nature of an on-premise CMMS also prevents it from being mobile and functioning remotely. Some on-premise systems can be accessed on a mobile device or remotely, but these capabilities are severely limited. This makes it difficult to access information in the field, leading to data inaccuracy and work delays.

When it comes to AI, on-premise systems cannot compete with cloud software. AI tools are built on data. This data makes insight and forecasts accurate and useful. On-premise software is unable to collect enough data to create effective AI tools for users.

Cloud CMMS

Cloud-based systems are open, meaning they have the potential to easily connect with 1000s of endpoints, from a sensor on a tractor to a huge ERP system. It doesn’t take months or half a million dollars to do this either. Data can flow between one piece of tech and your cloud-based CMMS within minutes of set-up without an IT team to make or maintain the connection.

Cloud-based CMMS software is also better suited to mobile and remote functionality. It gives you the power to access the system on mobile devices. Some software even allows you to access and log asset information in remote settings without an internet connection.

When it comes to AI, cloud CMMS software is head and shoulders above the competition. A cloud-based CMMS can collect data from thousands of users, anonymize it, and use it to build formulas that predict outcomes and give guidance to maintenance teams. Every piece of data fuels an AI engine, making it more accurate. The result is tools that help companies analyze and predict everything from high-risk work orders to the parts you’ll need for future maintenance.

The bottom line

The ability to implement and use AI and integrations set cloud software above on-premise systems. Ease of use should also factor into your decision-making. Cloud-based providers take constant input from users, improve the CMMS with it, and automatically make these improvements available to customers, giving it a slight edge.

Implementation

The success of a CMMS often hinges on implementing it correctly. Choosing the right software is critical to ensuring everything from installation to user adoption goes off without a hitch.

• Ease of implementation: Specialized technical expertise is needed to set up on-premise software. Cloud-based CMMS requires none, drastically reducing the time to implementation.
• Training and support: On-premise software comes with no external training and very few support services. Training and support are often built into the subscription package for cloud-based CMMS.
• Ease of data migration: Since cloud software can be accessed by any computer, it’s much easier to import data from spreadsheets or older systems.

On-premise CMMS

On-premise vendors often offer fewer standard services before, during, and after launching software. And the training and support available almost always come at an extra cost. So if you need help navigating the setup, it’s going to cost you. And because on-premise systems require hardware and lots of customization, it takes longer to design, test, and set it up.

On-premise software also requires a lot of input from your IT team. But setting up a CMMS is one of many projects on IT’s plate. Not only does this divert IT’s focus from other key projects, it also leaves your CMMS set-up vulnerable to any IT emergencies that pop up. This could delay the rollout of your CMMS and affect your budget, system adoption, downtime, and more.

Cloud-based CMMS

A cloud CMMS checks off all the boxes on-premise software can’t. Cloud-based providers build the price of support and training into your subscription and have customer support teams ready to help if you run into problems. Joining forces with experts who have done hundreds of implementations makes the process quicker and uses up fewer of your resources. This shrinks the time to implementation and ROI.

Implementing a cloud-based CMMS also causes minimal disruption to your organization. While the IT team is consulted and involved, its involvement is a tiny fraction of what it would be with on-premise systems, which is why implementing a cloud-based CMMS takes less money (up to 10x less) and time (several months) to set up.

The bottom line

Cloud software wins once again. It takes less time and money to set up, is less disruptive to your business, and offers ongoing support and training.

Data security and reliability

One data breach or system outage can spell disaster for your maintenance team and the company, which is why it’s critical to know which type of CMMS software offers more protection.

• Data management: Where is your data stored, how safe is it from internal and external breaches, and who is responsible for maintaining it?
• Security installation and updates: How is your software’s security being maintained and updated so that it stays ahead of the latest threats?
• Reliability and fail-safes: What happens to your data if something goes wrong?

On-premise CMMS

Data from on-premise systems is locked away on private servers so it might seem safer. But 53% of all data breaches are committed by people inside a company, according to a 2019 Forrester report. This number has surged 47% in two years. And most of the 47 IT experts interviewed by Digital Guardian said that insider threats are more common than external ones.

Losing your maintenance data is another nightmare. There are thousands of ways for data to be lost when it’s stored in a single on-premise server. Fire, floods, or even a spilled drink could destroy servers with no way to retrieve data.

Updating security measures on an on-premise CMMS is difficult and often expensive. Security measures that seemed adequate at the time of implementation get outdated quickly.

Cloud-based CMMS

The risk of external data breaches on cloud software is higher than on-premise software, but it’s decreasing every day as vendors partner with ultra-secure hosting providers, like Amazon Web Services, and align practices with globally recognized security standards, like SOC 2 Type 2.

A cloud-based CMMS also faces none of the dangers of on-premise systems when it comes to losing data. With cloud-based software, your maintenance data is stored off-site and in several places with fail-safes to protect it. Even if an entire server is wiped out, data is easily restored.

Updating security measures on a cloud CMMS is done by the vendor several times a year and whenever necessary. There is no work required by the user. Your software can stay ahead of the latest tools and strategies used by external actors to try and get your data.

Another consideration is software uptime. The difference between on-premise and cloud-based CMMS software in this category is minuscule. The standard uptime rate for cloud CMMS providers is 99.5%, although many guarantee higher levels. Much of the downtime that does occur is scheduled ahead of time for low usage periods to avoid disruption.

The bottom line

Your data is often safer on cloud-based CMMS software than on-premise software. Although cloud software is more vulnerable to external threats, these issues are less common than internal breaches. And the cloud’s ability to adapt quickly to constantly evolving security practices, as well as the number of data backups and fail-safes in place, make it the clear choice in this area.

Scaling a CMMS

Your company is always evolving and growing. Your CMMS should too. Finding a CMMS that can grow with your maintenance team and company means looking for flexibility in four areas: Functionality, pricing, connectivity, and size.

On-premise CMMS

Flexibility is not a strength of on-premise CMMS software. Almost every part of it is locked in from the moment you turn it on. As you grow, your processes will change. Unfortunately, the functionality of an on-premise solution can’t change with them. And because you’ve paid upfront for the CMMS, you risk making a big investment for severely diminishing returns.

On-premise systems don’t connect easily to new software. This isolates your CMMS and your maintenance team when your company adds new technology. And getting bigger often means new sites. Expanding on-premise CMMS software to new sites requires major disruptions and expenses, and often isn’t even possible

Cloud-based CMMS

Cloud software is built on flexibility. Functionality is always being added by vendors and companies can change the way they set up their CMMS based on new and improved practices.

Because subscriptions are re-evaluated monthly or annually, it’s easy to scale up or down depending on your financial position. And we already know that cloud-based CMMS software has open paths to connect to other software, no matter what it is.

Implementing a cloud-based CMMS at more than one site is as easy as purchasing as many subscriptions as you need and onboarding employees.

The bottom line

Cloud-based CMMS software takes this battle easily. It has way more flexibility in every area, which means your company can also be flexible as it grows.

Other areas to consider when comparing cloud and on-premise software

Sustainability

Reducing your company’s environmental footprint isn’t just the right thing to do, it also puts money back in your pocket and has all sorts of benefits, from government credits to good PR.

The fact is, every type of software creates emissions. But when we look at the data, it’s obvious that cloud software has a major edge over on-premise systems. The best proof comes from a study of Microsoft’s cloud programs. These cloud services produced an average of 51% less CO2 per user than comparable on-premise solutions. Much of the cloud’s advantage here comes from reducing the impact of the software’s servers by spreading its impact across hundreds or thousands of other users.

System maintenance

Maintaining your maintenance software is the last thing you want to do with your team’s time and money. That’s why a cloud CMMS is a clear winner in this area.

Cloud software is like having a home you never have to do maintenance on. Everything that makes the system run is monitored and taken care of by the vendor. On-premise software is the opposite. All of these responsibilities fall on you and your business, which drains your budget and time, and leaves you on the hook if anything goes wrong.

Control and customization

On-premise systems have a well-earned reputation for being highly customizable. But more doesn’t always mean better. Extreme customization can make the software hard to use and change. Once you’re locked into a way of working, it’s challenging to alter the functionality.

What a cloud CMMS lacks in extreme customization, it makes up for in flexibility. All it takes is a few clicks to modify your CMMS to fix outdated processes or workflows that aren’t results. From this point of view, you actually have more control over the function of the CMMS.

Another consideration is data control. Because your data lives outside your company’s walls with a cloud-based CMMS, it may seem like you have less access or ownership of it. But you have just as much access to your data as with on-premise software.

Deciding which CMMS software is best for your facility

There are pluses and minuses to both cloud-based CMMS software and on-premise software. Choosing between the two comes down to which one scores better for the combination of factors that matter most to your maintenance team. Although features, cost, and security are all important, it’s important to never lose sight of which software offers the best experience for users. If the software isn’t used properly and consistently, it will fail to deliver any value, regardless of what kind of CMMS it is.