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Cloud vs. On-Premises DMS: Your 6 Step Cost-Benefit Analysis

Laura Bulmer Author: Laura Bulmer
When it comes to choosing a Document Management System (DMS) such as DocuWare, businesses are often faced with a crucial decision: should you opt for a cloud-based or on-premises solution? Each option has its own set of advantages and challenges, particularly when it comes to cost, scalability, and long-term benefits.

This guide outlines the key considerations to help you make an informed decision

1. Upfront Costs and Financial CommitmentCloud Vs on-premise

On-Premises DMS

•    High initial capital investment (servers, hardware, software licenses)
•    Additional setup requirements (data centre space, IT personnel)
•    Ongoing equipment depreciation and upgrade costs

Cloud-Based DMS

•    Low upfront costs, operating on a subscription (OpEx) model
•    Predictable monthly or annual fees
•    Minimal need for in-house infrastructure

Learn more: DocTech Cloud Document Management

 

2. Ongoing Maintenance and SupportDocTech SupportIT

On-Premises DMS

•    Responsibility for system maintenance, software updates, and security
•    Requires a dedicated in-house IT team
•    Greater resource demand over time

Cloud-Based DMS

•    Automatic updates and patches managed by the provider
•    Less strain on internal IT resources
•    Regular access to new features

Find out how DocTech support our clients: About us

 

3. Scalability and FlexibilityAdvantage

On-Premises DMS

•    Scaling requires investment in new hardware and infrastructure
•    Slower response to business growth
•    Limited by physical capacity

Cloud-Based DMS

•    Easily scalable as your business evolves
•    Resources can be adjusted quickly and affordably
•    Ideal for businesses with fluctuating workloads or rapid growth

Read more: Digital Transformation Support 

 

4. Security and Compliancedocument security

On-Premises DMS

•    Full control over data and access policies
•    Higher responsibility for GDPR and regulatory compliance
•    Costs for antivirus, firewalls, and backup systems fall on the business

Cloud-Based DMS

•    Enterprise-grade security (encryption, MFA, data redundancy)
•    Compliance managed in partnership with the cloud provider
•    Regular audits and threat detection included

Security at DocTech: Data Protection & Compliance 

 

5. Disaster Recovery and Business ContinuityDisaster recovery

On-Premises DMS

•    Requires an in-house disaster recovery strategy
•    May need off-site backup storage
•    Recovery can be slow and complex in the event of a disaster

Cloud-Based DMS

•    Built-in disaster recovery and data redundancy
•    Faster recovery and minimal disruption
•    Maintains continuity during outages or emergencies

Explore our recovery solutions: DocTech Disaster Recovery: This is specific for each scenario and solution we provde - please contact us for more info on disaster recovery. 

 

6. Total Cost of Ownership (TCO)

While on-premises systems may appear to be cost-effective in the long term, hidden costs such as hardware replacements, staffing, and future upgrades can make them more expensive. Cloud-based solutions typically provide better value due to the higher functionality on offer as well as with fewer surprise expenses and improved ROI.

Conclusion

If your business prioritises flexibility, cost-efficiency, and seamless scalability, a Cloud-based DMS is likely the best choice. With built-in disaster recovery, enhanced security, and reduced internal IT strain, it's well suited for modern, agile organisations.

However, if your industry demands strict data sovereignty or highly customised infrastructure, an on-premises solution may still be a viable route—albeit with the data responsibility being on yourselves as well as the ongoing maintenance requirements. 

Get Expert Help with Your Decision

With over 40 years of experience, DocTech can help you navigate the best route for your business—cloud, on-premises, or hybrid. We are DocuWare experts with over 30 years as a UK DocuWare partner at the highest accreditation.

Get in touch for a free consultation on 0161 647 7040 or email us at info@doctech.co.uk.

Read our latest blog - Using AI to Meet Financial Compliance Requirements.

Get In Touch

Contact us now for more information 0161 647 7040