It seems that in many cases, the issue of “Cloud” based software solutions versus traditional self-hosted solutions has become the primary decision point for companies procuring project management/accounting software.  Unfortunately, this sometimes happens at the expense of what should be the single most important consideration: functionality.

Functionality is the hard part.  It is the hardest for the software company to deliver; the hardest to implement; the hardest for users to understand; and the hardest for purchasers to evaluate.  Getting from functional evaluation through to completed functional implementation means “rolling up one’s sleeves” and doing some very detailed work.  Unfortunately, all too often, the specter of doing this due diligence is more than people want to embark on.  Furthermore, because of all the industry-wide buzz and hype regarding “the Cloud,” people become easily distracted, and end up focusing all of their attention on the Cloud issue.

Most software, whether Windows-based or browser-based, can be remotely deployed.  And yes, native browser-based software does deploy remotely less expensively and with less IT infrastructure required.  However, the application is relatively unaware of the two major items which define Cloud computing: who owns the server and where the server is located.  Ultimately, you can own the server and have it physically located at your location or in a remote data center, or someone else can own the server and rent you access to it.  The software, and (most importantly) the functionality delivered to users is still going to be the same.  For example, the same Spitfire Project Management System is available both as self-hosted and Cloud-hosted.

So, does Cloud versus self-hosted make a difference?  Yes, there are valid cost of ownership issues, including initial capital cost, upgrades over time, IT professional services, etc., which will make one or the other a more cost-effective solution for you over a proposed ROI period.  There is no hard and fast rule here; even today many software systems are being deployed on a self-hosted basis, so you have to do your homework.

However, at the end of the day, make sure that the financial analysis of Cloud versus self-hosted is done independently of, and subordinate to, the primary goal of finding software that functionally meets your business needs.