Dynamics 365 Online vs. On-Premise in 2020

The “never-ending” battle of cloud vs on-premise systems presents a truly, persistent, challenge. Steve Jobs once said: “It’s faster in every case to talk to the server than it is my local hard disk… Carrying around these non-connected computers, with tons of data and state in them, is byzantine by comparison.”. This was back in 1997, at the Worldwide Developer Conference. Well, we would think that by now, over two decades later, most businesses would have adopted cloud computing.

Although the number of companies going online has been increasing, year after year, there’s still some underlying skepticism about the whole concept, especially when it comes to the security of their sensitive data.

If you are new to Dynamics 365 Customer Engagement, or if you have an on-premise version, the cloud can certainly be the answer for your business, for various reasons.

When it comes to security, it’s insured by Microsoft’s itself. Microsoft Dynamics 365 online is integrated with the Azure AD (Active Directory), which has multiple critical layers to its security model. The organization invests over $1B a year in it, ensuring the best security for their users and their respective digital property.
That’s being said, you’ll hardly get any advantages on using the on-premise version, security-wise.

As Microsoft is carrying it’s “Cloud first” mission, they are focused on delivering more and better functionalities in Dynamics 365 online, pretty much leaving behind the innovation towards the on-premise systems. There are multiple features, such as the Power Platform and PowerBI, that are not supported on Dynamics 365 on-premise. Even some Dynamics 365 CE modules, such as Project Service Automation, are only available for the online version.

If we’re talking about maintenance, there’s virtually none, therefore there’s no cost in that regard. As it is a cloud-based application, naturally no hardware is required, and all the software upgrades are handled by the service’s provider.

Software upgrades
When using Dynamics 365 online, Microsoft manages the updates, as they release minor and major updates throughout each year, which upgrade the software automatically. This way, there’s no need to have a dedicated IT team to get such complicated processes done.

When talking about deployment, the online version is quicker and easier to deploy whereas with on-premise you need insure you have the required hardware and software that complies with the application. On top of that, you must handle all the process yourself.

Cost Model
Dynamics 365 CE online is based on a “pay-as-you-go” subscription model which is very friendly when it comes to finances. You can choose an appropriate plan depending on your needs, and change it anytime, which makes the whole thing very flexible. On the other hand, on-premise requires a large initial capital investment (CapEX).

Our take.

The advantages are clear. If the cloud can provide better security, less costs, more features, and overall less headaches, why wouldn’t you go for it?