The rooted usage of on-premises systems around the globe leaves many companies with no room for a discussion on what type of implementation scenario to use. Usually, due to miscalculations of total procurement costs and widely spread myths about cloud solutions, legacy IT architectures are chosen without an in-depth analysis of all alternatives. But with a growing need for more flexible and fast-to-obtain solutions, cloud-enabled services in airport and ground handling operations are becoming more popular. Increasing demand is especially visible among small-to-medium and regional airports.
As the demand for data-based business decisions grows every year, the need for more efficient process management solutions in aviation also grows, particularly in airport management and ground handling operations.
Historically famous on-premises decisions truly have their reputation of being reliable and huge-capacity enabling IT architectures. However, nowadays, business environment needs are changing, middle-sized companies are usually not ready to undertake huge investment projects. Moreover, long-lines for implementation and expensive licensing become not only a strong headache for smaller businesses, but sometimes also an impetus to search for new decisions. It is essential to understand the main differences between these solutions to make the right choice for the company.
Cloud-based software is vendor’s hosted service, which is accessed online and is considered as an outsourcing solution. In contrast, on-premises architectures are installed locally, on the company’s servers. It usually requires substantial investments to procure a one-time perpetual license (CAPEX), cover installment costs and constantly support the system. In contrast, the cloud-based software is more of a service that companies procure on a monthly or annual basis (OPEX).
Total costs of ownership trap
The key difference between the two options is the price, or more precisely, the ability to understand and estimate total costs of ownership (TCO). It is commonly agreed that approx. 15% of costs are clearly visible, definable and countable, though the remaining 85% are non-visible and often mathematized wrongly.
In many cases, when doing on-premises implementation, the company needs to start with the acquisition of such legacy licenses as Oracle or Microsoft. This not only takes time, but also a lot of money and inflates TCO significantly. Procurement authorization of such third-party commercial licenses is usually taken de facto and is not questioned, thus impose miscalculations in the TCO comparison. In contrast, such alternative solutions as open source allow disclosing and foreseeing TCO with more ease. And most importantly, decrease overall costs significantly without the need to purchase expensive licenses.
“It is essential to understand that on-premises are a huge investment project, such costs as maintenance of the system, training, recruitment of new people, 24/7 support availability, recovery in case of disaster and many more people-related costs can increase the primary financial estimates in times. In contrast, the price for monthly cloud services already includes basically almost everything you need to store data and manage account, thus costs are easier foreseeable,” commented Edmundas Vasonskis, Co-founder of Sensus Aero, cloud-based Airport & Ground Handling Operations Management IT solution.
The payback is another good monetary metric for evaluation. The independent study by Software Advise revealed that cloud-enabled solutions are up to 60% cheaper within first 5-6 years of implementation, though if company is looking for 10 years and more solution, investment in on-premises may be a more attractive choice.
Maximized availability and security
There is an old stereotype saying that keeping your data on a cloud vs on-premises is akin to keeping your money in the bank vs under your mattress. Cloud-based solutions find it hard to strengthen positions in the market due to the stereotype of being unsafe. However, all security issues are in the hands of vendor and they usually have very strict standards regarding data security information. This is what they live out from and they can’t risk their reputation while providing data security sensitive services.
In addition, while holding data on web-based clouds, constant updates from vendors are available. This offers much more stability and ownership of the most recent information. In a few minutes any data in need can be accessed and analyzed. In addition, most providers guarantee 24/7 support, which would be extremely costly in case of in-house system’s maintenance. Finally, key improvement in safety-related issues can be explained through the encryption of data that ensures the safety on cloud-based resources.
Implement service in few hours, check data in minutes
Fast setup and implementation is among top reasons for the usage of cloud, especially for small, medium or regional airports. When on-premises installations together with license procurement can take sometimes even 6-12 months, cloud software can be deployed within days or weeks.
Moreover, cloud in most scenarios means that it is web-based. This feature means that client needs only internet connection to access stored data, thus work from outside the office with either PC or mobile is made available. Opposite applies to desktop applications, they are much harder to achieve and requires additional infrastructure, licenses and maintenance under on-premises. Though cloud solutions are usually referred as under customizable, they contrarily, provide far more flexibility.
“Our team previously had lots of experience while working on other IT-related projects with huge legacy systems. But eventually we understood that we need a more modern and flexible solution that would provide us with on-time performance data, which is key in aviation business. Any changes in need to be implemented are flexibly carried out online in minutes, in contrast to on-premises systems, where new changes require timely and costly updating processes. Though understanding different clientele needs, Sensus Aero chose to provide a twofold service type. While solution itself is running at our systems, clients can choose either to install the architecture locally at their infrastructure or use solution as a cloud service,” adds Edmundas.
To sum up, cloud-based solutions do not require significant initial investment. Instead, they provide flexibility in planning financial resources and drawing the full picture of TCO. It complements internal costs savings and is in many cases a cheaper solution than legacy systems. In addition, cloud solutions can be implemented relatively quickly compared to on-premises systems and allows increased security of the data. Finally, cloud-enabled and web-based solutions, are not only more easily implemented (as require only an access to the Internet), but are also mobile, which allows authorized users to reach required data from anywhere and with any device.