The most appropriate delivery model for each business process is dependent on the unique characteristics of each company and its industry. But whatever a company's situation, Microsoft is committed to providing the greatest amount of choice in software delivery. Ultimately, Microsoft believes every company will want to distribute its processes across three delivery models:
On-premise. Companies host their Microsoft Dynamics software at their own location, on their own servers. This offers maximum opportunity for integration with other IT systems. Often, companies choose on-premise deployments when their IT organization has established domain expertise for that process or technology. They also choose this option when their business processes involve sensitive data or requirements or differentiate them from the competition.
Partner-hosted. Microsoft works with independent software vendors (ISV) and system integrator partners all over the world, so you get an industry expert from a local company. These partners offer hosted Microsoft Dynamics applications in their area of expertise. Their solutions are often ideal for specific vertical processes or for highly customized processes with precise requirements.
Microsoft-hosted CRM. Microsoft Dynamics CRM Online is hosted in Microsoft data centers and offered directly from Microsoft on a subscription basis. Microsoft Dynamics CRM Online uses a single, multi-tenant code base so that customers can switch between on-premise and on-demand deployments as their needs change.
Determine your business drivers
The unprecedented flexibility of software delivery that is available to customers today represents a tremendous opportunity to reduce costs, strengthen core capabilities, and speed business agility. When considering which delivery model to use for a particular business process application, make sure to examine the various business drivers.
Risk. Consider whether the availability, performance, and security of your application contains sensitive data that should never be hosted beyond the company's firewall.
Cost. Requirements for the application can help you to determine which approach is most cost-effective.
Differentiation. Business processes that are core to your business and take advantage of in-house expertise typically remain on-premise. But commodity processes can be outsourced.
Time-to-market. Hosted applications usually can be set up much faster than on-premise solutions, allowing you to implement new or changed processes as quickly as possible.
Resource availability. On-premise deployments often require more time and money than deployment of a hosted application. If budgets are tight or your IT department does not have free resources, hosted applications can deliver process improvements more quickly.
Process affinity. Some processes are inherently more suited to either hosted or on-premise deployment. E-commerce and supply chain operations often rely on hosted applications, whereas manufacturing is often deployed on-premise.
