IT & InfrastructureBeginner 2 to 3 hours

Cloud vs On-Premise Cost Comparison

Build a credible three-year TCO comparison for an SA SME considering moving to the cloud.

The Scenario

A 40-person SA logistics company has an aging on-premise server room running file shares, an ERP, and Exchange. The directors want to know whether moving to Microsoft 365 plus Azure is cheaper or more expensive over three years before signing a refresh quote.

The Brief

Produce a three-year total cost of ownership comparison covering on-premise refresh versus cloud migration. Make defensible assumptions about user counts, storage, and licensing, and document them.

Deliverables

  • A TCO summary table showing on-premise total, cloud total, and the delta over years 1, 2, and 3
  • A detailed breakdown for each option covering: hardware, software licensing, support contracts, electricity and cooling, internet connectivity, IT labour, and contingency
  • An assumptions log listing every assumption made (user count, storage growth, average labour rate) so the directors can challenge specific numbers
  • A recommendation paragraph stating which option you favour and the three biggest factors a director should weigh in deciding

Submission Guidance

Cloud is not always cheaper. Honest TCO comparisons surface the cost of bandwidth, the labour of migration, and the opex-versus-capex implications. Avoid the cloud-vendor sales-deck trap of comparing only year 1.

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