Nearly as old as time itself, billing has gone through many iterations. With the introduction of the cloud, billing moved from being a disparate back-office product to being an integral component of the entire quote-to-cash process. By its very nature, the cloud provides companies with the ability to deliver exceptional customer service. While simultaneously providing cost efficiencies never before thought possible. A recent report by Flexera discovered that 93% of enterprise businesses are using some form of a cloud-based system, and 73% are planning to optimize existing use of the cloud for additional cost savings. What cost savings can you expect, and how do you know that choosing an enterprise cloud billing solution over an on-premise IT stack is the right choice for your company?
When deciding which option is best for your business strategy, there are four key considerations. But first, let’s take a quick look at the differences between cloud and on-premise billing solutions.
Cloud vs. On-Premise Billing Solutions
As the term implies, on-premise billing products require the company to purchase and maintain the hardware, software and servers. This not only requires a data center, but IT personnel to set up and maintain the system. Basically, on-premise billing consists of recurring costs for hardware updates and dedicated technical personnel, as well as costs for ancillary hardware to support the on-premise server.
In contrast, the premise of cloud-based billing is that the hardware, software and infrastructure are hosted by the cloud vendor. With an enterprise cloud billing solution, the cloud provider handles all of the physical aspects of the system. In this scenario, servers are automatically updated, reducing operating costs and providing more cost predictability.
How Much Can You Save With an Enterprise Cloud Billing Solution?
Weighing your options requires looking at both the tangible aspects such as expenses and efficiencies, as well as intangible traits like disaster recovery and elasticity. Considering both helps you analyze the cost of each of the options, putting you one step closer to choosing the right solution for your needs.
The following takes a look at both the quantifiable and unquantifiable advantages of an enterprise cloud billing solution.
1) Scalability and elasticity
Due to fixed physical hardware resources of on-premise billing products, they are simply unable to provide the required flexibility. When more capacity is required, you will need to purchase additional storage space and server resources. With fluctuating billing usage requirements, you may find yourself with twice as much equipment as you typically require.
Built to accommodate shifting usage requirements, cloud billing solutions provide the flexibility to quickly and easily add or remove products, modify subscription billing plans, update or change payment methods, create innovative billing models, develop complex products with diverse pricing plans, and handle international and tax requirements with ease. Enterprise cloud billing solutions provide the elasticity needed to rapidly scale so you only pay for what you use.
When servers go offline, business typically comes to a screeching halt. With the average cost of downtime in the thousands of dollars per hour, you want to do everything possible to ensure that the billing system maintains high availability. Unless you have in-house mirrored-image billing systems, downtime does happen and can be costly. Not only monetarily, but on your ability to deliver the experience your customers expect. Conversely, cloud-based billing solutions provide the redundancy needed, reducing downtime risk.
3) Security and compliance
Security and compliance are especially important for highly regulated industries such as finance. While on-premise billing platforms provide companies with more control over their data, they are also more vulnerable to system breaches, requiring the latest software to mitigate cybersecurity threats – which is time-consuming and costly.
Data stored in the cloud makes a physical data breach much less likely. Since cloud-based billing solutions aren’t connected to a physical location or the servers of a specific organization, they provide the anonymity required to lessen the potential of a data breach. In addition, most cloud vendors provide a variety of techniques to protect data from theft, leakage, and deletion.
4) Ease of integration
To create a completely integrated financial ecosystem, you need the ability to quickly and seamlessly integrate with disparate systems. This includes enterprise resource planning (ERP), customer relationship management (CRM), general ledger, tax solutions, and more. While integration of your on-premise billing system with your other on-premise systems is possible, it takes manual effort. This is where enterprise cloud billing solutions excel. Designed for quick and seamless integration, this straightforward approach synchronizes data between systems providing you with limitless billing integration capabilities.
Essentially, cloud vs. on-premise billing solutions comes down to capital expenditures (CAPEX) and operational expenditures (OPEX). Purchasing new equipment is a capital expenditure, whereas consuming cloud storage is primarily an operational expense. When we look at storage through a financial lens, purchasing 1TB of on-premise storage can cost as much as $100,000, making it nearly 10x more costly than 1TB of cloud storage.
Start Saving Today With The Best Enterprise Cloud Billing Solution
When choosing between an on-premise billing platform and an enterprise cloud billing solution, there are numerous tangible and intangible considerations. Like more than three-quarters of today’s enterprises, BillingPlatform’s industry-leading cloud-based platform resides on a public cloud hosted by Amazon Web Services (AWS). Our solution provides the unparalleled flexibility needed to put control where it belongs – in your hands. With BillingCloud you’re able to maximize profitability, reduce operational costs, and deliver the type of customer experiences that drive loyalty. Talk to a member of our team and learn more about how BillingPlatform’s cloud billing solution can change the way you do business today.