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Is on-premise CRM a bad investment given the growth of SaaS CRM?

Are on-premise CRM investments a bad idea, given the growth of SaaS CRM software? Find out about both CRM deployment options in this expert tip.

I've been hearing from everyone that Software as a Service (SaaS) CRM is the wave of the future, and now that the economy has tanked, it seems it's only furthering the growth of SaaS. But what does this mean for traditional CRM implementations? Is it a bad idea to invest in on-premise CRM at this point?
Not necessarily. While SaaS CRM is not only a great option but a major and mainstream one, it is only one choice. Making the decision between on-premise vs. SaaS is based on how the software is delivered and the pricing model. You still have to examine the functionality that makes sense to your needs, the pricing, and how comfortable you are with your data residing elsewhere --- though, honestly, security shouldn't be a concern. The SaaS model is safe. Either model is viable. Both have strengths and weaknesses. SaaS's margin of advantage in the recession is that the costs are repeatable, controllable and spread out, with less upfront investment unless there is a lot of customization to do. That doesn't mean on-premise is going away anytime soon. It is still the dominant delivery model in terms of total deployments. SaaS is predicted to reach 25% of total deployments by 2013.

Choose what makes sense, not what's trending. Neither approach is going away -- which is better for you, because you now have a choice.

This was last published in April 2009

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