Welcome to today's CIT Tech for Business podcast.
Today we are sitting down with Chris and Kyle and we're going to discuss cloud versus on
prem the smack down is what we're going to call it today.
I'm going to kick it off by introducing the marketing gals on the podcast today but we're
also going to ask you guys while you're introducing yourself tell us about your favorite cuisine.
So I'm Tara one of the marketing gals that you'll receive all the emails from my favorite
is my homemade shepherd's pie and Kelsey I'll kick it over to you.
I was like dang girl that sounds good and I love the whole marketing gals term I'm here
for it.
I'm Kelsey one of the marketing gals favorite cuisine man I'm boring can we say that chocolate
is a favorite cuisine because if so live it for it 100% but I'll pass the baton right
on over to Chris.
Thanks Kelsey well good morning everyone and I'm Chris Taylor one of the founders of CIT
and for 28 years I led the organizations or present CEO until I handed the reins over
to Kyle who will talk about his favorite cuisine next but I think my favorite cuisine is anything
that has really good flavors right so I think you know I'm all about flavor I'm all about
creativity and flavor and fusion of flavors so that's my my favorite cuisine.
Kyle that's a big list.
I'm Kyle as Chris mentioned I've been at the organization for 29 years I was the chief
technical officer before Chris turned the reins over a couple years ago now the president
and CEO from a cuisine side of it but like Chris I like flavors so Mexican pizza Italian
you know those are those are go-to's for me big chipotle guys so we've done about five
days a week a couple days of pizza there we go.
Awesome I did want to kick it off so thank you guys for all sharing about that now I'm
hungry because I did not have breakfast yet but I'll survive I got my coffee.
Why don't you guys kind of start us off by telling us what's the difference between cloud
versus on-prem those are two terms that we hear quite often but let's break those down
first.
Do you want me to take that one I can I can start that out I mean really now it's different
to your on-prem means you're going to be having servers and systems within the walls of your
business in some location could be potentially a data center but you own the systems that
host your data you install and support the applications maybe have a contract vendor
come in and access your systems to do some support on it but primarily you're in charge
of hosting the actual compute power systems for for that data and system side of it with
a cloud that means the provider of the application is actually hosting the actual hardware and
systems at a time so the accessibility the internet the security around it those other
components handled by a provider.
Yeah and kind of just extend on that I mean I think our industry back and you know if
you look through the mid to late 80s when the PC was introduced we moved towards client
server computing right where we put a server in and we put PCs on the desktop and that
was all pretty much on-premise because keep in mind back then the internet really didn't
exist as a business tool yet so everything really had to go on-premise and we were we
were transitioning from mini and mainframe to putting in this client server world deploying
desktops and putting in servers now you know roll forward 30 plus years and we're and we're
putting we're really driving where the application sits based on where if it's on-prem or in
cloud and I think you know to we'll talk about this but I think the the application side
is really driving that that on cloud or on-prem discussion and I think more and more in general
are being moved to the cloud but it's funny to look back because if you look back 30 years
ago there was applications like ADP payroll application that was already in the cloud
but people really didn't think of it in the cloud it was just it lived there nobody really
thought of it as a cloud app it was just a payroll app but it's been in the cloud as
long as I can remember and that's kind of the drive of what's changed and where we're
going today that it's really application driven yeah it was green screened back in the day
I mean it was just a terminal you know with a motive dial up at at one point but yeah
yeah I mean it's kind of come full circle again but you know I do think the application
you know provider that is definitely the leading factor most application providers nowadays
are you know eliminating their on-premise options and I think there's a lot of reasons
for it you know from the support being the big part of it because it has been it is difficult
to keep on-premise customers on the same versions from a support standpoint and to maintain
a lot of versions of of the application going back and with the requirement now to have
so many security updates and patches it's just gotten to be too big of a too big of
a mountain for them to tackle for resources continuously go back and patch multiple versions
of of their application so they want to support a consistent application across their customer
base and the best way to do that is host themselves and there's obviously benefits for the for
the customer at that point too because it's that security is a big part of it real big
part of it yeah and I think you know just one of the first questions I asked when we're
talking clients about that discussion around cloud versus on-prem and you know what's right
is you know what it what are those core business applications and where where do they live
today what what's the future of them what's the manufacturer doing with them and if you
look at our industry especially in the last five years most of those manufacturers of
those primary business line of applications are providing them as a cloud-based app for
all the reasons Kyle has talked about you know control of code control of versioning
control of upgrades control of security so you know I think the biggest and and and
probably our biggest transitional product that over the last 10 years has been the migration
of the Microsoft platform to the Microsoft cloud right it's an easy example right to
to host your email on-premise became expensive and difficult and it was labor-intensive so
Microsoft really developed the platform to allow us to move that that application right
strictly email but then they along with that they gave us all kinds of other things we
can do so that's probably the easiest right but it is a change because you know like how
talk to this to some degree we're moving our cost from you know kind of capital cost buying
gear putting it in the server room wherever it may be to now we're moving to subscription
to operational costs where it's it's monthly or annual subscription based we really don't
own any that year we don't have the capital expenditure but we do have that longer term
operating expense and subscription based and maybe you can add more to that but it's transitional
of how you pay for it yeah you know that operational move and that covers you know across the whole
use cloud that's typically comes with it there you're moving from capital expense to operational
expense Chris mentioned whether you pay annually or monthly and it's always you know seat based
licensing typically you're going to have a headcount you have a user they have associated
license with their product and services they use which again is is a little different the
on-premise side of it would have some version but typically you just you'd either you could
do per device or per seat and you could do some troops with an annually side of it so
you know you had a little more freedom with your license on-premise across a lot of applications
on-side of it so it was a certainly a little more easier to work but you know we did also
see some concerns with that come up over the years between software audits and different
things that come up that you would find that customers would fall behind on licensing or
they didn't really know what they had for licensing really became a great unknown and
they would be audited and in some cases a really bad surprise of what they would owe
in what could be very expensive licensing because the product didn't stop you but you
could definitely be out of compliance and legally you'd have to true that up yeah and
the other piece that that really I think drove a lot of cloud expansion especially in the
last two years if you look at the pandemic and you look at the workload shift from moving
a lot of workload from in-office personnel to remote or home workers those cloud applications
were fairly easy to just turn over and connect to the cloud the on-premise gear was a little
more difficult to move everyone remote and get remote access to all that with the security
so I think that the last you know we'll call two and a half three years now really even
pushed harder on that cloud-based experience because the mobility of it right it's very
easy to attach to that wherever you are if you're mobile if you're at home you're working
remote or you're in the office the experience is pretty much the same which is which is
really good for a user experience right because in the old days when we had to design these
systems to remote access and it was cumbersome and the experience for the users wasn't as
good now as the manufacturers build out these cloud apps for that specific purpose of remote
access and cloud access the experience is really good so that's another thing we talk
about yeah that that the last few years I mean that's exactly right last few years but
huge on that I mean you had to adopt to be able to work outside the office because while
we had no choice and if your if your systems were all internal or percent of them at least
you had to have some kind of VPN to connect into those systems to do that some secure
method and that brought its own challenges to many customers VPN has overhead it introduces
some performance related issues and in scalability I mean a lot of customer systems really meant
to have X you know a few number of users working outside the office so they weren't scaled
to have the entire organization come in so we ran a lot of scaling challenges that had
to be adjusted very quickly there in that side but those customers that key systems
outside there are you know they were already acting externally for everything so Chris's
point it was it was a lot easier transition so that's made a lot of customers I think
look at that oh and you know we really need to be able to stand as if it comes again because
it's all fresh of mind right now people are you know we had to go home again for period
on if you know somewhere to come up again you'd want to be able to not have that problem
yeah you need to look at the other thing to look at and I think a lot of people thought
about is you look at our traditional voice our traditional telephones in our voice world
right that that was always a very typical premise based platform and then you know let's
say 10 years ago we really started to see more and more cloud offerings for that traditional
telephone business service right and today I think a lot of people don't really understand
that they're running on a cloud phone system and they have been for a number of years so
I think transitions happened in the background to the cloud and some users really don't even
understand that they're running in the cloud and and there again that transition when that
user went to work remote the transition for the phone system just followed them just like
the rest of their apps that were in the cloud so really good business you know experience
there and I think you know it's made that that cloud acceptance much more adaptable
I think the biggest challenges we have are what do you do with the legacy stuff how do
you handle stuff that really just isn't cloud enabled isn't cloud ready what do you do with
it right because if you were a new business starting from scratch day I think it would
be fairly easy to put it all in the cloud but now we've got businesses that have been
running technology for 30 plus years and it's a bunch of different legacy product that may
or may not be cloud available so we have to help them blend what we call hybrid environments
where it's still some premise based stuff but the majority of the move is to cloud yeah
yeah that's a very good point there's not for many customers it doesn't just happen
you know just make a switch over a week and you're in the cloud typically if you're small
and you're nimble as Chris mentioned you can find cloud applications pretty easy and certainly
on a startup but you know there's tremendous ways I don't think it's been any easier to
start a business than it is in in 2022 you can literally have a very robust business
set of applications and those things without any you know upfront investment you just start
paying monthly fees and away you go so you can have tremendous power and you know but
when you have legacy system sides I mean to put those into cloud systems like Azure AWS
you know our ways you can make some inroads to move those to cloud platforms you know
kind of extend your corporate infrastructure to those cloud platforms that gives you some
of the cloud security cloud scalability of those platforms without having to build out
data center or physical security and power and uptime side of it many of those legacy
systems were predicated being close to it so you have to bring in some kind of remote
desktop technology like you know RDS from Microsoft or virtual desktop solutions of
those things where you're connected to that desktop and then access those applications
you know we still definitely deal with that because it takes time I mean substantial investments
in those platforms for a lot of customers and it just takes a lot of time you know so
many cases we work with the customers to just plan the transitional because again you know
just the want to move doesn't mean you're ready to move so you can it takes planning
in many cases it goes back to that first point your applications when your applications are
ready when their provider says that they could move you for that application or you rewrite
it then you can potentially be all cloud but for many customers that's a long road.
And on the flip side of that you know that old legacy premise stuff there are new apps
that are developed now that are only cloud enabled right you really can't install them
locally anymore on a premise based platform so to some degree I don't think it's a choice
anymore it's really look at the applications we what's best for the business what's best
for the business line of business applications and then based on those applications and their
availability is going to drive you know if it's more cloud if it's more prem based but
if we look forward future wise more and more that is moving to cloud cloud based platform
for all the reasons we've been discussing but the migration and move is to more cloud
more cloud more cloud but that puts you know that puts you know a lot of pressure on some
of the other components of the network right so connectivity becomes a huge thing endpoint
management and connectivity and redundancy become that much more important right because
if you're a business and you've started and you all your applications are in the cloud
and you're running on a single non-business grade internet connection that internet connection
goes down you've just lost access to all your core business functionality so now we have
to shift a lot of our conversation around connectivity redundancy reliability and performance
of those public connections because they are now even more important and to even make it
more important if they've moved their phone system to the cloud not only do they lose
access to their primary core data applications they've lost access to their phones so connectivity
and redundancy has become even more of a hot topic than it was yeah and we've seen that
I think even more you know the biggest vertical I see that in schools you know schools have
made that transition most schools now are pretty much a hundred percent cloud on their
applications and we spend work with them on you know tremendous amount and very very robust
infrastructure you know they have they have very fast you know internet connections redundant
internet connections you know redundant Wi-Fi you know there's redundancies throughout that
that's first point you need to be able to access that for them to be able to teach the
students I think that's a tremendous use case where it's leveraging both those examples
you know to the fullest you know schools have done a remarkable job of doing that and then
you know through that pandemic side of them you know they all do education outside the
walls of the school you know the kids needed internet to be able to get to it you know
the other component that that layers on there's the security of it you know security is obviously
a big discussion side of it and that's the other investment that needs to be looked at
strongly because not only do you have to take in account the security of what used to be
you know on premise side of it where you just put a firewall in you know and you had your
endpoint protection and and that was considered you know ample security do your patches and
go through it well now you have all these access points to your data across these cloud
systems so you have to take a very unified approach and look at single sign-on solutions
and other component sides of it where you can unify your usernames and passwords through
products like octa or you know Active Directory or Azure AD should call it into those areas
and bring in multi-factor and bring in conditional access where you can geofence say you can't
log in say outside the United States or in certain locations you only allow geographically
to log in and access there's all these other controls you want to take into account because
the only thing that's predicated for the core requirement for cloud is internet access the
internet's global so you have to you know the the threat actors are able to potentially
gain access to that data without having to break through a firewall in this case you
know that you traditionally think to get to your on-premise systems so you have to have
other other ways to measure and protect your data within those cloud platforms yeah like
I mentioned that mean it really puts pressure on identity management access control you
know who are you where are you how do you gain access is is it you right how do we know
it's you if we're all out remote we're all in the cloud how do we know it's you on the
other end of the device so that puts a lot more pressure on the security of identity
management access control multi-factor authentication so we have some challenge of is it you is
it really you out there and that's that's some of what Kyle's talking about is how do
you do that with all these varied cloud applications that are all over you really need to put the
kind of that unified platform in place to help manage that those functions so it's just
shifted you know really the the old you know on-premise client server into more of a global
access technology in the cloud and how do you manage how do you secure how do you get
redundancy and performance things like that become more top of mind yeah it used to be
with that identity management you know Active Directory has been the legacy one for for
the last number of decades sides of it and it was even Nobel then before that side of
it but it we know where is your source source of truth where your users their information
at and really it's starting to see you know the you know I let's call it kind of this
the beginning of the death of Active Directory side is starting to occurring in Microsoft's
roadmap side of it where the legacy Active Directory has started to you know it has been
that on-premise location for your usernames and passwords and systems but from a security
standpoint it is plagued because its legacy with a tremendous amount of security holes
you know and it's being compromised consistently with privilege of escalation techniques and
other sides of it if they gain access to a device that's within the Active Directory
they will be able to get privilege escalation and get administration access through you
know hundreds of potential vulnerabilities you know sometimes thousands if they're old
enough it's a it's a big it's a big thing to try to try to mitigate from a security
person standpoint and it's been a problem and continues to evolve so you know the answer
to that is start to modernize that and that's your as your Active Directory it's your octets
those other you know those other places where those identities can go and they have more
modern approaches that are again cloud-based and have modern security they don't have to
have the legacy side that Active Directory is carried forward you know and that's usually
what plagues legacy systems is they have to support so many far back you know the fact
that they're doing that also introduces a lot of issues too so it's the planning through
that and how do you make these transitions and how do you continuously grow you know
that we have to work with customers to say how do you start moving forward because you
just can't flip the switch and say we're moving over to Azure AD or octet it's a it's a process
and it takes time but you know it's something that you can get there you just have to start
planning for it and give yourself a give yourself a runway to get there.
I know we're coming somewhat up on our time here Tara and Kelsey but did you have other
specific things you want to talk about regarding the you know is premise the solutions cloud
the solution are there other specific things that that you have on kind of your task list
that you wanted us to discuss them?
Yeah that's a great question Chris one of the things I did want to talk about is what
these Microsoft subscriptions that we were talking about monthly and annually how do
we ensure that our customers are up to date on any end of life or end of operating systems
tell me a little bit about what those subscriptions help with.
Why I think anytime you move from you know keep in mind originally we would just buy
the license and we would sit on the device and that we would kind of it was kind of up
to the user to say oh it's coming into life or we need to upgrade it or we need to change
operating system when you move to subscription based most all those subscriptions are going
to require you now to stay up and current because they're going to discontinue supporting
the older subscription version you're on so it does help with that management of those
you know versions and that's quite frankly I think one of Microsoft's goals is because
for them to support all these different various versions of OS and products is very very difficult
but if they can subscribe you and they can make you stay fairly current it helps all
of us from a support ability and they're helping us manage you know when it's going into life
so in that subscription model it's a lot easier to help with that legacy management of versioning.
Yeah that's you know there was a period of time we dealt with a lot of what was called
that OEM license or what you bought with the computer stayed with the computer when you
ordered it and you know the advent of the subscription side really really eliminated
the problem from that because what would happen is is your version of Office was always as
old as the computer and that was the version of Office you had so you have many customers
with you know kind of a tossed salad of Office versions from you know multiple year side
of it could cross a five to six year or more span of different Office versions and now
it's descriptions because everybody's on the same version it'll automatically stream and
everybody stays up to date automatically so you know it really has helped you know from
a network administration standpoint of you know knowing that everybody's on the same
version and if you're trying to share an Excel file you don't deal with the compatibility
problems you know so there has been a huge problem eliminated with the advent of that
for the customers that made the shift and for us it's a high percent of them I mean
we don't have too many customers that aren't using a subscription license in some form
of their for their Microsoft Office at least and even if they still have exchange on premise
that component is subscribed now and it's it's eliminated a lot of support problems.
I think it's been one of the biggest advantages of the Microsoft 365 platform is that Office
version control right I mean I think if we look back 10 years ago plus when we were buying
like Kyle mentioned licenses right we were buying them with the PC or we're buying an
open license for our company that didn't force us to keep up to date right all it did is
we bought volume licensing on but what we were challenged with is customers had multiple
versions of Office which led to Kyle's point about different versions of Word documents
and Excel spreadsheets and you know the one of the huge advantages of Microsoft 365 is
made everyone consistent right we're all running the same product we're all running the same
version that compatibility that we used to deal with 10 years ago has really gone away
and that's now that's now pushed itself through the whole Microsoft platform so Microsoft
even if you're going to continue to run some of their product on an on-premise basis it's
still subscription based and they're still saying hey in order to keep your subscription
going that platform is going to have to be updated or else it's going to go end the life
and it's not going to be supported right so they've moved pretty much their whole platform
to that model even if you're going to run it still on-premise which is great it's easier
to manage for us for sure.
Even the Windows OS itself is moving in that direction has moved with these feature updates
so that aside to that I mean they no longer want to have they don't want to revisit the
XP problem where people stayed on Windows XP for for 15 years it you know that that
stayed on so long they want to be able to move the operating system along from the
supportability and security of it so you know even the transition even though they call
it say Windows 11 it's still a it's still Windows 10 it's the same core just continuously
refreshed through there with a little different UI refresh on it but you know the the streaming
and operational side of that that's they're doing the same thing with the Windows OS at
this point too and they're bringing in the Windows licensing into their Microsoft 365
licensing so you get you know enterprise licensing as part of your subscription which gives you
all kinds of additional security and additional you know business-based access capabilities
and it's you know I think it's great it allows you to have consistency across that OS as
well it's been another another challenge.
What else Tara?
Well I was just getting ready to say let's kind of wrap that up you know if you guys
want to talk about some key takeaways about this discussion today we'll kind of kick that
off and wrap her up and we'll let everybody get back to their day.
Yeah I mean I think the key things we talked about it's really application driven you know
where are your prime business logic applications right are they cloud enabled already do you
have cloud access so look at the applications we know where is it best to be housed and
supported as we go forward right and then and then how do we deal with our legacy stuff
you know have a plan for that it is the migration path from the manufacturer that's moving to
cloud so and then understand supportability around it right how do we support you know
how do we support that hybrid environment we still have some premise based stuff but
we maybe don't need all of our you know IT support on the premise based stuff we need
to move that more to cloud-based support so I think look at the application understand
your current infrastructure and application and then have a good roadmap to you know what
does that cloud integration look how do we move workload to the cloud and does it make
sense yeah yeah I think I think that's start having the plan you know work with your application
vendors understand those know where know where they're going with their application base
or understand are they going to end a life your applications things like great planes
for example have you know approach end-of-life side of it so you know Microsoft has dynamics
in the cloud at their business central your customers look at net suite there's all kinds
of things you start to start having those planning processes and those will be your
be your your your leaders into making some of these transitions if you're still on prem
with exchange you know that may not necessarily be wrong but you know consider some of the
other benefits sides of it map those out you know if 365 is something you need to get through
we understand customers have made capital investment into infrastructure and systems
and licensing you want to be able to to maximize those investments but you know make the plan
so the next you know upgrade around make sure you do the assessment look at the at the full
value state where it's at before you just reinvest into it as well and then the Chris's
earlier comment you know invest in that infrastructure you know and continue to prep yourself for
you know things like redundant internet redundant firewalls you know build a robust infrastructure
if you're going to have those things in the cloud you know don't don't overlook those
those key variable sides with it and the only last point I you know we didn't I didn't get
into the conversation side with it one one other distinct benefit we've seen with the
accessibility of cloud applications has been the ability for people to work anywhere any
place which does open up hiring opportunities for companies to be able to open open up hiring
you know not they don't have to travel to your office they don't have to be within driving
distance of your office either so you know and then this tough job market it does provide
some other key benefits there too.
Yeah and we didn't spend a lot of time about the the capex opex and the budgeting and the
cost side of it I think there is still some confusion on you know total cost of of cloud
versus prem and I think and I think if you look at it from a holistic 50,000 foot view
I don't think either is any cheaper than the other it's understanding it's a different
cost model and I think there is efficiencies to moving workload to the cloud when you take
in total cost of operating that platform and I think that's one of those bigger benefits
but some of our clients will look at it say well I bought it I own it I can run it as
long as I want I don't have to pay subscription forever but when we start to walk through
total cost of all that and supportability it does really shift that conversation that
yeah it probably makes more sense to move to more cloud-based subscription based and
have a predictable cost versus this variable cost over time so I think understanding capex
opex and total cost operate are key pieces that we didn't spend a lot of time but it
doesn't need to be talked about and put into that budgeting process so.
Yeah we could probably talk about our on that one.
That might be a whole other podcast about that capex opex and total cost.
I would concur with Chris I think when it's all said and done when we run the comparison
I think when you take total cost in there you're going to find you know there isn't
much of a cost delta side of it and you can bring in so many other you know soft cost
components into the discussion side of it that you need to really take into account
that you know I wouldn't let that be the term there because it's just far more than the
initial this is why I pay for the license this is what I paid to purchase that's the
difference you need to take more into account there's far more there to take an account
I think you look at holistically there's that that's not enough to deter anybody from moving.
Yeah that could be a whole other podcast here talking about cost.
For sure.
I love that I know Kelsey and I are going to be like feverishly writing down we got
lots of podcasts coming here just out of this discussion today but thanks again Chris and Kyle
really do appreciate you taking time to talk through our subject on cloud versus from the
smackdown as always you know we love to talk about technology so please let us know of any feedback
or any additional topics you guys would like to hear us talk about you can visit our website
which is cit-net.com backslash podcast or you can send us an email at info at cit-net.com and we
certainly look forward to chatting with you guys more next week have a great day.
Thanks everyone.