So you’re ready to tackle that all-important CRM initiative for your company. Selecting the right CRM deployment model must first and foremost address your key business problems and challenges, enabling you to meet your strategic business goals. And the more you know the pros and cons of each deployment model, the more certain it is that you will embark on a path to CRM success. How will we initially acquire and deploy the technology solution? Can we change deployment models mid-stream? These are important questions to be answered. In general, you have 3 deployment choices:

1. On-Demand (aka Cloud, Online or SaaS) – this is typically an internet-based subscription model where you rent the software from a third party who will provide and maintain the hardware, databases, backups, technical support, etc.

2. On-Premise – where you typically purchase a software solution and deploy it with your own (or consulting partner) resources, and your company owns and provisions the hardware, databases, technical support, etc.

3. Hybrid – typically this is when you purchase the software and deploy it in a 3^rd party data center, effectively outsourcing the hardware, databases, and technical support of the solution.

You will need to consider multiple factors in making the initial deployment decision; however there is usually one factor that rises to the greatest importance in making the initial decision. A CRM solution that gives you the choice of deployment options, and the flexibility to migrate the system to a different deployment method over time “seamlessly” is a major advantage. The factors that we believe are important to consider include:

• Initial cost of software
• Lifetime cost of software
• Initial cost to purchase and deploy hardware
• Overall cost of maintaining hardware
• Technical “human resources” required
• Timeframe
• Deployment migration path

To further understand how these factors are evaluated in deployment decision-making we will expand on each one individually:

Here we ask ourselves would we rather have a consistent monthly expenditure that minimizes the short-term impact on cashflow or capital outlay? Do we want to capitalize the new system (On-Premise) and depreciate it over many years, or treat it as an annual operating expense (On Demand)?

It is very important to think about how much the new “system” will cost in the long run. Consider all of the cost factors. Plan on getting at least 7 years out of this particular CRM deployment (if you do it right)!

a) Initial cost to purchase and deploy hardware (On Premise): would you rather purchase and deploy the hardware and systems infrastructure required by the CRM solution? Or would you rather outsource and pay a monthly fee?

b) Overall cost of maintaining hardware (over the life of the system): consider all of the costs of maintaining and replacing hardware, operating system software, database software, etc over 7 year period (including the infrastructure required to support the internet-facing deployment for your users).

Technical “human resources” required

Do you already have an IT shop or a business department who will be dedicating resources to own the deployment and on-going maintenance and support of the CRM solution? Will you need to hire to full this role? Is it better to outsource for the technical resources needed?

How quickly do you need to deploy? Obviously, an “on-demand” or “hybrid” deployment method that takes advantage of an outsourced data center and technical resources pre-dedicated to the CRM solution will dramatically reduce the time of deployment if you have a simple CRM business process that will not require many customizations. However, you should keep in mind that the technical deployment of the hardware and infrastructure, in many cases, is a small duration compared to the requirements definition, analysis, design, configuration, customization, and data migration required in the initial rollout of the customized CRM solution.

That is, how easily will the solution migrate from one deployment option to another? Is it important that you have the power to choose to start out in a rapid deployment mode, piloting the system and developing your core business functionality, customizations and business processes in the “On-Demand” deployment? Then, when it is most economically prudent to redeploy the customized solution intact to either a Hybrid or On-Premise deployment? Your chosen solution would ideally give you this flexibility without the need for a major customization rewrite or a major database migration effort.

You may want to consider seeking out and engaging an experienced trusted business partner to help you make the deployment decision. This will be a critical success factor no matter which deployment method you choose. Your trusted business partner will help you evaluate each factor, understanding your business needs, budgetary constraints, and other unique circumstances, and will help you develop the deployment strategy that best meets your needs. Experience matters. Choose a partner who has a proven track record of success in this area. 

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