Leaving Behind Legacy Solutions: SaaS vs On-Premise Software

Posted by Gaby Isturiz on Feb 16, 2018 9:50:30 AM


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The time has come to address the elephant in the room of legal technology once and for all: it’s time to say goodbye to on-premise software. Chances are, that statement is not a shock and you’ve been considering making the switch to SaaS-based cloud solutions. According to a study conducted by North Bridge Venture Partners, “45% of businesses say they already, or plan to, run their company from the cloud - showing how integral the cloud is to business.” The survey also points to the continual shift to cloud-based applications, noting an adoption rate that has grown from 13% in 2011 to 74% in 2017.

As the market for cloud services continues to grow, it is expected that 80% of all IT budgets will be allocated to cloud solutions. You are likely seeing this happen at your firm as well, as more than half of AMLaw 200 firms use cloud computing. As cloud adoption continues to grow at today’s law firms, is there any value in continuing to invest in on-premise software?

Simply put, no.

In this post, we’ll take a look at how on-premise software is detrimental to your firm and why SaaS is a better solution for your firm.

Why On-Premise Software Is Holding Your Firm Back and Creating Unnecessary Risk

When it comes to choosing to invest in on-premise software as opposed to a SaaS solution, it is considered to be making life harder than it has to be. Here are a few reasons that on-premise software does not serve your firm:

#1: Lengthy implementation

Implementation of on-premise software is costly in both time and money. A typical implementation takes months, if not a year. By the time you have the software implemented, it is already obsolete...which brings us to our next point.

#2: Obsolescence

Not only is the software out of date by the time it is implemented, you must continually invest staff resources and dollars into updating the software.

#3: Drain on internal resources

Implementation, updates and support require an extensive amount of time from your over-committed IT team. When on-premise software is present, staff must be available to tend to it 24/7.

#4: Security risks

Security protocols are constantly changing to meet the demand and sophistication of threats. Investing in and keeping up with the latest security needs is costly, time intensive and necessary updates are easy to miss - leaving your firm and its client data vulnerable.

#5: Costly to implement, maintain and support

You will need an extensive budget in order to support the implementation, maintenance and ongoing support of your software. Furthermore, on-premise software often requires higher up-front costs than SaaS solutions, thus increasing the financial burden on your firm.

SaaS isn’t just the future, it’s now. Why SaaS is better for law firms:

#1: It is Cost-effective

Rather than waste money on maintaining, implementing and supporting your software, allow the vendor to incur those costs. A SaaS subscription will also allow you to avoid upfront investment, which can help with cash flow. 74% of Tech Chief Financial Officers (CFOs) say cloud computing will have the most measurable impact on their business in 2017.

#2: It is Scalable

As your needs evolve, SaaS solutions make it easy to make necessary changes to meet your demands, such as adding and removing users.

#3: It has Built-in mobility

Unlike on-premise solutions for which you will have to devise a workable mobile solution, true SaaS solutions are built with mobility in mind and provide one experience, regardless of location or device.

#4: It allows you to pay as you go

One of the most well-known aspects of the SaaS model is subscription pricing. This allows you to pay as you go, making the investment much more manageable for the firm.

#5: It makes for a quick implementation

The difference between an on-premise solution and SaaS implementation is months versus hours. Which do you prefer?

#6: It gives you access to top-of-the-line security

Selecting the right SaaS vendor will mean that your data is always protected with the most up-to-date security standards and most rigorous protocols.

#7: It is a better use of resources

When your staff isn’t committed to maintaining and supporting costly software in house, they can provide more strategic value to the firm.

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What's Stopping Firms from Adopting SaaS?

There is a perception that security is best handled in house and that using a cloud vendor is an increase to security risks. According to the North Bridge study, “security continues to be a strong barrier with 49% of respondents concerned about how secure their data is in the cloud. Privacy concerns also rose, once again, to 31% in 2014 as increased tension manifested itself between the desire for anonymity and the convenience and utility of personalization. This is an area for vendors and enterprises to distinguish themselves as faithful custodians of personal data and engendering trust.”

The impact, in terms of cloud adoption, is real, as 49% of businesses are delaying cloud deployment due to a cybersecurity skills gap.

However, according to this article in Forbes, distrust is lessening due to an increase in security investments on behalf of vendors:

“Just 23% of organizations today completely trust public clouds to keep their data secure. A year ago, only 13% trusted public clouds. This 76% jump in trust for one year is attributable to public cloud platforms investing more development effort and resources in security features and support. From authentication to more complex secured APIs, public cloud platform providers are hardening every aspect of their systems to ensure greater security and scalability. This strategy is paying off with the total number of organizations who distrust clouds dropping from 50% to 29%.”

It is our belief that SaaS providers are better positioned than law firms when it comes to delivering the highest level of security for its clients. As our friends at Thomson Reuters point out:

“Many cloud providers can provide the same or greater level of security than what the largest law firms can feasibly provide on premise. SaaS and managed service offerings supply different levels of data and infrastructure separation, i.e., degrees of multi-tenancy, albeit there is more multi-tenancy in public clouds, such as AWS and Azure. Most cloud providers can satisfy SOC 2 audits that evidence policies, communications, procedures and monitoring that directly correlate to the availability, confidentiality, privacy, processing integrity and security of data. Unauthorized access to data is ensured with encryption, multifactor authentication, virtual private, intrusion detection systems and network tunnels. Cloud providers that own their own data centers have hardened physical systems in place to prevent unauthorized access, such as biometrically controlled doors, CCTV cameras and alarms. Many law firms find it difficult to meet cloud security levels due to the high capital expenditures and ongoing maintenance costs.”

What are your plans for utilizing the cloud for your firm this year? Share your comments below.

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Topics: Software as a Service (SaaS)