On demand will meet both an increase in employees and an increase in revenue, so there is no imperative need to switch to the on-premise solution to meet those increases. SAP on demand is a single tenancy model, as opposed to a multiple tenancy model. That means that SAP's on demand template for each customer is maintained on a separate database. This prevents across the board outages that may occur with a multi-tenancy model, where...
all customers are on the same server. The single tenancy model also provides an easy upgrade from on demand to on premise, should the customer decide to customize the application to meet their specific business requirements. Also, SAP CRM On-Demand software uses the same code as SAP CRM on premise. Hence the switch should be relatively easy.
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