The GoSmartHR Blog

What is the difference between on-premise, hosted and cloud solutions?

Terminology concerning cloud computing is often bandied about in conversation, often incorrectly, but technically speaking there is a difference between on-premise, hosted and cloud solutions and you should understand these differences.


Most systems/solutions consist of a database of some sort.  For example, a system like GoSmartHR has a Microsoft SQL database SQL DB) that can be accessed via different applications to serve different user groups within the organisation. The SQL DB can be installed on the customer’s premises on a server managed by their IT department.  This is referred to as an on-premise model.  In this case, the IT department are responsible for managing the hardware, backing up the database, and upgrading applications as part of the organisational data management strategy. At all times, the customer owns the database as part of their SQL instance.


Alternatively, the customer could choose to host the SQL DB at a data center managed by a third party.  In this case, the customer maintains ownership of the database but the data center is responsible for managing the hardware.  The customer has the option to elect to manage the application updates.

Cloud Solution

The third option sees the vendor hosting the database in their own data centre.  In this case, the vendor is responsible for managing the hardware, the database, and the application updates.  The customer has no access to the physical database or raw data.  Many cloud solutions manage multiple customers on a single database, referred to as a ‘multi-tenant’ solution.  The benefit of this approach for the vendor is scalability since upgrades to the database only have to be performed once and not to multiple instances for each customer.  Should the customer cancel the subscription to the application, the data stored in the database can only be returned in the form of data extracts determined by the vendor.  This makes migrating to a different service provider difficult.

Some more GoSmartHR terminology

Regardless of where the database is located: either on-premise, hosted or in the cloud, the database is accessed via different applications which are either desktop (client-server) or browser based.

GoSmartHR Desktop: This is a client-server application and is typically used by the HR users in the organization.  The rich functionality in a client-server application is suited to resource intensive activities such as data imports and bulk data actions.  The connection to the database can be done from a desktop via ODBC or remotely via Remote Desktop Session where the application is accessed on the server.

GoSmartHR Employee and Manager Self Service: The GoSmartHR Database, regardless of where it is located, can be accessed via a browser-based application.  Where this is accessed within the company’s Local or Wide Area Network (LAN or WAN) this is referred to as an intranet application.  Where it is accessed via the Internet, it is referred to as a cloud solution.


GoSmartHR supports on-premise, hosted and cloud deployments. Some customers do not deploy the desktop application at all and choose rather to implement the web-based interface with a hosted database.  This is also a cloud solution.

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