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SaaS vs. On-Premises ERP: A CIO’s Strategic Decision Framework
Key Takeaways for the CIO
- Beyond CapEx vs. OpEx: The modern ERP deployment decision is a strategic choice affecting agility, security, control, and AI-readiness, not just a financial one. The true total cost of ownership (TCO) for SaaS can be 2.5x to 4x the subscription fee when accounting for integrations and customizations.
- The 5-Factor Decision Framework: A robust evaluation must go beyond simple cost and analyze: 1) Total Cost of Ownership & Financial Model, 2) Control, Customization & Security, 3) Scalability & Performance, 4) Integration & Ecosystem Readiness, and 5) AI & Future Technology Adoption.
- Control is the Core Tension: On-Premises offers maximum control over data, customization, and upgrade cycles, which is critical for highly regulated industries or businesses with unique processes. SaaS offers speed and convenience but requires relinquishing some control to the vendor, creating potential lock-in.
- Failure is Systemic, Not Technical: ERP deployment failures often stem from a strategic mismatch, not technical incompetence. Common failure patterns include mandating "cloud-first" without assessing specific operational needs and underestimating the hidden costs in both SaaS (integration fees) and On-Premises (personnel, maintenance) models.
- The Safest Choice is Flexibility: The optimal strategy may not be a single model but a hybrid approach or a platform that offers deployment flexibility.Choosing a modular ERP platform like ArionERP, which supports both SaaS and On-Premises deployments, de-risks the decision by allowing you to align the deployment model to specific business needs without being locked into a single vendor's architecture.
Why the Deployment Decision is More Critical Than Ever
The ERP deployment model, once a background technical detail, has been thrust into the strategic spotlight for CIOs. This shift is driven by a confluence of powerful market forces that have raised the stakes considerably. The decision is no longer about where software runs; it’s about how the business will operate, compete, and evolve for the next decade. The very definition of 'cloud ERP' has become so elastic that it's almost meaningless without deeper scrutiny, covering everything from multi-tenant SaaS to privately hosted instances, each with vastly different risk and cost profiles. This ambiguity makes a clear-eyed, first-principles approach essential for any IT leader.
First, the cybersecurity landscape has transformed risk calculations. On-Premises deployments offer maximum control over the security perimeter, a crucial factor for industries with stringent data sovereignty or compliance mandates like HIPAA or GDPR. However, this control comes with the immense responsibility of managing infrastructure security, patching, and threat detection. Conversely, SaaS vendors offer robust, specialized security teams and infrastructure, which can be a major advantage. Yet, this introduces a shared responsibility model where the CIO must trust the vendor's security posture while managing access controls and data governance within the application, recognizing that a single compromised account can expose the entire system.
Second, the pace of business transformation demands unprecedented agility. SaaS platforms, with their automatic updates and rapid feature rollout, promise to keep businesses on the cutting edge of innovation. This is a powerful lure for companies looking to accelerate digital initiatives. However, this forced-march innovation can disrupt highly customized or validated environments. On-Premises provides control over the upgrade cycle, allowing businesses to test and deploy changes on their own schedule, a critical capability for manufacturing or life sciences where system validation is paramount. The tension for the CIO is balancing the need for rapid innovation against the need for operational stability and control.
Finally, the rise of AI and composable architectures has fundamentally altered what a modern ERP should be. An ERP is no longer a monolithic system but an intelligent, data-centric platform that must integrate seamlessly with a vast ecosystem of other applications. The deployment model directly impacts this capability. SaaS platforms often come with pre-built API ecosystems, but they can also limit deep, server-level integrations. On-Premises allows for unbounded customization and integration but can create a complex, brittle architecture if not managed with discipline. For the CIO, the deployment choice is now a bet on which model will best support a future of AI-driven insights and modular, plug-and-play business capabilities.
The Traditional Approach (and Why It's Now Flawed)
For years, the ERP deployment decision was governed by a relatively simple set of criteria, often dominated by the CFO's preference for capital expenditures (CapEx) versus operating expenditures (OpEx). In this traditional model, an On-Premises solution was a major capital investment: servers were purchased, perpetual licenses were bought, and a team of internal IT staff was hired or trained to maintain it all. The decision was primarily financial and logistical. If the company had the capital and the IT resources, On-Premises was the default choice for control and ownership. If it preferred a predictable monthly cost and lacked a large IT team, the emerging SaaS model was an attractive alternative.
This old way of thinking was rooted in a world where business processes were more static and technology evolved at a slower pace. The CIO's role was often to 'keep the lights on,' ensuring the system was stable, backed up, and available. Customization was common but often led to 'brittle' systems where years of bespoke code made upgrades risky and expensive. The evaluation process focused heavily on feature-function comparisons and the initial implementation cost, with less emphasis on the long-term total cost of ownership (TCO) or the strategic implications of vendor lock-in. The assumption was that the ERP, once implemented, would be a stable fixture for a decade or more.
This traditional framework is now dangerously obsolete because it fails to account for the modern enterprise's most critical needs: agility, data fluidity, and ecosystem connectivity. It treats the ERP as a self-contained island rather than the central hub of a dynamic digital ecosystem. The old model dramatically underestimates the 'hidden costs' that now define ERP success or failure. For On-Premises, it’s not just the servers, but the constant cycle of hardware refreshes, security patching labor, disaster recovery testing, and the challenge of retaining talent skilled in aging technologies. For SaaS, the subscription fee is just the starting point; true TCO includes costs for integration, data migration, and premium support, which can multiply the headline price significantly. [23
Most critically, the traditional approach is blind to the strategic cost of lost opportunity. A rigid, On-Premises system that can't easily connect to a new AI forecasting tool or a partner's supply chain platform creates a competitive disadvantage that no CapEx/OpEx spreadsheet can capture. Likewise, a SaaS solution that locks your data into a proprietary format or has inflexible APIs can stifle innovation and prevent you from building unique business processes. [17 Today's CIO must think like a portfolio manager, weighing not just cost and control, but also risk, flexibility, and the long-term return on technology-enabled business capabilities. The old model is simply not equipped for this new reality.
Is Your ERP Decision Framework Stuck in the Past?
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Request a ConsultationA Unified ERP Deployment Framework: The 5-Factor Model for CIOs
To make a durable and defensible ERP deployment decision, CIOs need to move beyond a simple pro-and-con list and adopt a multi-dimensional framework. This 5-Factor Model provides a structured way to analyze the trade-offs between SaaS and On-Premises, forcing a conversation that is strategic, not just technical. It ensures all stakeholders, from the CFO to the Head of Operations, understand the full implications of the choice. By evaluating each option against these five pillars, you can create a clear, data-driven rationale that aligns with your specific business context and risk tolerance.
This framework serves as a powerful decision artifact, transforming subjective opinions into an objective comparison. It moves the discussion from 'which is better?' to 'which is better for us, given our priorities?' For example, a manufacturing firm with decades of customized machine integration and strict data residency requirements might weigh the 'Control & Customization' factor most heavily, leaning towards On-Premises. [5 In contrast, a rapidly scaling retail business might prioritize 'Scalability & Performance' and 'AI & Future Technology Adoption,' making a compelling case for SaaS. There is no universally correct answer, only the answer that is correct for your enterprise's unique fingerprint.
The practical application of this model is to score each factor for both deployment options based on your company's specific needs and strategic goals. This isn't a mere checklist; it's a diagnostic tool. A low score for SaaS in the 'Integration' category, for instance, might not disqualify it but instead highlight the need to budget for a dedicated Integration Platform as a Service (iPaaS). Similarly, a low score for On-Premises in 'AI Adoption' could signal the need for a parallel investment in a cloud-based data science environment. The framework illuminates the necessary secondary investments and operational commitments required to make either choice successful.
Ultimately, this model helps CIOs articulate the complex trade-offs to the board in clear business terms. Instead of presenting a technical choice, you present a business decision with quantifiable impacts on cost, risk, security, and agility. This elevates the CIO's role from a technology provider to a strategic business partner, ensuring the ERP platform becomes a catalyst for growth, not a barrier to it. The following table provides a high-level comparison to guide this evaluation.
Decision Artifact: SaaS vs. On-Premises ERP Comparison Matrix
| Factor | SaaS ERP (e.g., Multi-Tenant Cloud) | On-Premises ERP (Self-Hosted) | Key CIO Considerations |
|---|---|---|---|
| 1. Total Cost of Ownership (TCO) & Financial Model | Lower upfront cost, predictable OpEx (subscription). Hidden costs in integration, data egress, and premium support. TCO can be 2.5-4x subscription price over time. [23 | High upfront CapEx (licenses, hardware), lower long-term subscription costs. Hidden costs in IT personnel, hardware refresh cycles, security, and maintenance. [27 | Which model aligns with our capital allocation strategy? Have we modeled a realistic 5-10 year TCO, including all hidden costs? |
| 2. Control, Customization & Security | Vendor controls infrastructure, updates, and core code. Customization is limited to configuration or approved APIs. Security is a shared responsibility. [28 | Full control over hardware, software, data, and upgrade schedules. Unlimited customization potential. Full responsibility for security and compliance. [5 | Do our business processes provide a unique competitive advantage that requires deep customization? What are our data sovereignty and regulatory requirements? [22 |
| 3. Scalability & Performance | Excellent elasticity; scale users and resources on demand. Performance is dependent on the vendor's infrastructure and can be affected by other tenants. [29 | Scalability requires manual hardware procurement and capacity planning. Can provide superior performance for predictable workloads if architected correctly. [15 | How predictable is our growth? Do we need to handle sudden peaks in demand, or is our workload stable? |
| 4. Integration & Ecosystem Readiness | Often provides a marketplace of pre-built connectors. API-first design can simplify cloud-to-cloud integration but may limit deep legacy system access. | Complete freedom to build any integration. Can be complex and require specialized skills. Better for deep integration with on-site operational technology (e.g., manufacturing equipment). | Is our IT landscape primarily cloud-based or a mix of cloud and legacy systems? How critical is real-time integration with shop-floor or lab equipment? |
| 5. AI & Future Technology Adoption | Vendors often bundle AI/ML features and roll out innovations automatically. Provides faster access to new technology without internal R&D. [11 | Requires building or buying a separate AI/ML stack. Offers more control to develop proprietary algorithms using raw data. Can lag in adopting new vendor-led features. | Is our strategy to consume best-of-breed AI services or to build proprietary AI capabilities as a differentiator? |
SaaS ERP Deep Dive: The CIO's Perspective
From a CIO's viewpoint, the primary allure of SaaS ERP is the promise of simplification and speed. It abstracts away the complexities of infrastructure management—server provisioning, database tuning, and patching—allowing IT teams to refocus on higher-value activities. [17 The financial model, a predictable operating expense, is often easier to budget for and aligns with a broader enterprise shift away from owning depreciating assets. [29 For a company undergoing rapid expansion, launching a new subsidiary, or entering a new market, the ability to deploy a standardized ERP instance in weeks, not months, is a powerful competitive advantage. This speed-to-value is arguably the most significant driver of SaaS adoption.
However, a seasoned CIO must look past the marketing gloss to understand the inherent trade-offs. The convenience of SaaS comes at the cost of control. You are, in effect, ceding control of your core operational platform's upgrade schedule, patch management, and underlying infrastructure to a third party. While vendors provide SLAs, an unplanned outage or a mandatory update that conflicts with a critical custom integration is the vendor's problem to fix, but it's your business's problem to endure. This shared responsibility model requires a new skillset in vendor management, contract negotiation, and governance that is just as critical as technical expertise. [28
From a security and compliance perspective, SaaS is a double-edged sword. Reputable SaaS vendors invest far more in cybersecurity than most individual companies could afford, offering enterprise-grade physical security, threat detection, and disaster recovery. [16 This can significantly improve the security posture of many mid-market companies. The challenge, however, lies in data governance and compliance. For businesses in sectors with strict data residency laws, it's crucial to ensure the vendor can guarantee data will be stored in a specific geographic location. The CIO must conduct thorough due diligence on the vendor's certifications (e.g., SOC 2, ISO 27001) and understand exactly where the lines of responsibility are drawn. [22
The long-term strategic implication of choosing a SaaS ERP is the risk of vendor lock-in. As you build business processes, integrations, and historical data within a specific SaaS platform, the cost and complexity of migrating away from it grow exponentially. [17 This gives the vendor significant leverage in future contract negotiations. A savvy CIO mitigates this risk by ensuring data exportability is a contractual right, investing in an integration strategy that is not platform-dependent (using middleware or iPaaS), and avoiding over-customization that deepens the dependency. The decision to go with SaaS is not just a one-time purchase; it is the beginning of a long-term strategic partnership where the CIO must constantly manage risk and maintain leverage.
On-Premises ERP Deep Dive: The CIO's Perspective
For many CIOs, especially in manufacturing, defense, or other highly regulated industries, the case for On-Premises ERP remains compelling and is centered on one word: control. On-Premises deployment provides the ultimate authority over every aspect of the ERP environment, from the hardware it runs on to the specific version of the software being used. This level of control is not a matter of preference but a business necessity when dealing with unique, highly-customized processes that provide a competitive edge, or when regulatory bodies mandate that sensitive data cannot leave the physical confines of the organization. [5 It allows for deep, low-level integrations with legacy operational technology (OT) on the factory floor—systems that may not be cloud-compatible but are essential to production.
The financial profile of an On-Premises solution is fundamentally different, characterized by a large upfront capital expenditure for licenses and hardware, followed by ongoing costs for maintenance, support, and personnel. [27 While this model has fallen out of fashion in the 'as-a-service' era, it offers long-term predictability that can be attractive. Once the initial investment is amortized, the year-over-year costs can be significantly lower than a perpetually escalating SaaS subscription, especially for companies with a large but stable user base. [8 The CIO's challenge is to build a credible, multi-year TCO model that accurately accounts for all the 'hidden' costs: hardware refresh cycles (typically every 3-5 years), database and OS licensing, power and cooling, and the fully-loaded cost of the specialized IT staff required to manage the stack.
From an architectural standpoint, On-Premises offers unparalleled flexibility. There are no restrictions on customization; if you have the development resources, you can modify the system to match your business processes perfectly. This is both a blessing and a curse. While it allows for the creation of truly differentiating capabilities, it also carries the significant risk of creating a 'Frankenstein' system—a highly brittle, over-customized environment that is incredibly difficult and expensive to upgrade. [7 A strategic CIO manages this by enforcing strict governance over customizations, favoring configuration over code, and building modifications in a modular way that isolates them from the core ERP application, simplifying future upgrades.
Security in an On-Premises world is a fortress-building exercise where the CIO is the chief architect. You are solely responsible for defending your ERP system. This means managing firewalls, intrusion detection systems, physical data center security, and a disciplined patch management process. [21 While this is a heavy burden, it also means you are not exposed to risks from a multi-tenant environment and have complete visibility and control over your security posture. For a CIO with a mature security organization and a mandate to protect mission-critical or highly sensitive intellectual property, this direct control can be a non-negotiable requirement, making On-Premises the only viable choice despite the broader market trends.
Common Failure Patterns in the Deployment Decision
ERP modernization projects are notorious for their high failure rates, with Gartner estimating that 55% to 75% of projects do not meet their objectives. [30 These failures are rarely due to a single technical error. Instead, they often stem from flawed strategic decisions made at the very beginning of the process, particularly around the deployment model. Understanding these common failure patterns is the first step for a CIO to avoid them. The decision process itself, if not handled with discipline, can set a project on a path to failure long before the first line of code is written or the first subscription payment is made.
One of the most common failure patterns is the 'Cloud-First-as-Dogma' Trap. In many organizations, a top-down mandate is issued to move all systems to the cloud, often driven by a desire to appear modern or to shift IT spending from CapEx to OpEx. While well-intentioned, this rigid, one-size-fits-all approach ignores the nuanced realities of the business. A CIO, under pressure to comply, may be forced to select a SaaS ERP that is a poor fit for critical business units. For example, a manufacturing division with complex, validated shop-floor systems that require deep, real-time integration may be forced onto a generic SaaS platform. The result is a cascade of expensive and fragile workarounds, custom middleware, and broken processes, ultimately negating any of the hoped-for cloud benefits. The failure here isn't the cloud; it's the failure to allow for a hybrid approach where the deployment model matches the specific business need. [2
A second, equally pervasive failure pattern is Underestimating the 'Total' in Total Cost of Ownership (TCO). Teams on both sides of the debate fall into this trap. Proponents of SaaS often present a deceptively simple calculation based on the monthly subscription fee, ignoring the substantial costs of data migration, integration with other systems, and essential premium support tiers. Analysis shows the true TCO for SaaS can be 2.5x to 4x the headline price. [23 On the other side, advocates for On-Premises frequently underestimate the long-term operational burden. They may budget for the initial hardware and software licenses but fail to account for the recurring costs of skilled IT personnel, infrastructure refresh cycles, security software renewals, and the significant labor involved in planning and executing major version upgrades. [27 In both cases, the project's budget is unrealistic from day one, leading to budget overruns, cut corners, and an eventual failure to deliver the promised value.
A third failure pattern is Mistaking Deployment Model for Business Transformation. An ERP implementation is a make-or-break opportunity to redesign and streamline business processes. [11 However, many organizations treat it as a purely technical 'lift and shift' exercise. They either move their inefficient, legacy processes directly into a new SaaS system or re-implement them with heavy customization on an On-Premises platform. In both scenarios, the technology changes, but the business does not transform. [9 The project is deemed a failure because, despite the massive expense and effort, the business sees no improvement in efficiency or agility. A successful CIO understands that the ERP project is a Trojan horse for business process re-engineering and that the choice of deployment model should be made to support that transformation, not as an end in itself.
A Smarter Approach: The 'Choice-Enabled' ERP Platform
The persistent tension between SaaS and On-Premises highlights a fundamental flaw in the market: buyers are often forced to make an absolute, irreversible choice upfront. This binary decision forces CIOs to bet their company's operational future on a single architectural model, accepting a package of compromises that may not align with their diverse business needs. A rapidly growing e-commerce division needs the agility of SaaS, while the established manufacturing plant requires the control of On-Premises. Forcing both onto a single platform—either cloud or on-prem—guarantees that one (or both) will be ill-served. This is the dilemma that legacy ERP vendors create, and it's a primary source of project risk and value leakage. [12
A smarter, lower-risk approach is to reject this false dichotomy. Instead of choosing a deployment model, a forward-thinking CIO should choose a platform that offers deployment flexibility. This is the concept of a 'choice-enabled' or hybrid-ready ERP platform. The ideal platform, like ArionERP, is architected with a modular, AI-enhanced core that is functionally identical whether it is deployed in a multi-tenant SaaS environment, on a private cloud, or within a company's own data center. This architectural parity is the key to de-risking the entire ERP strategy, as it separates the decision about what the ERP does from where it runs.
This approach offers immense strategic advantages. A CIO can adopt a 'best-fit' deployment strategy on a case-by-case basis. The corporate finance and HR departments can leverage a standardized SaaS deployment for efficiency and rapid innovation. Meanwhile, the manufacturing division, with its unique operational technology and data sovereignty requirements, can run the exact same ERP modules on an On-Premises server, ensuring maximum control and performance. [3 Because the underlying platform is the same, data models and core processes remain consistent, dramatically simplifying integration and governance across the enterprise. This is the essence of a true hybrid ERP strategy, enabling a phased and strategic modernization. [2
Furthermore, a choice-enabled platform provides a crucial off-ramp if business conditions change. A company might start with a SaaS solution for its speed and low upfront cost. As the business matures and its needs for customization, control, or compliance evolve, it can migrate its operations to a private cloud or On-Premises instance of the same ERP without a painful, high-risk 'rip-and-replace' project. This flexibility eliminates vendor lock-in at the architectural level. [15 By choosing a platform like ArionERP, the CIO is no longer making a single, high-stakes bet. Instead, they are building an adaptable operational backbone that can evolve with the business, ensuring the ERP system remains an asset, not a liability, for years to come.
Conclusion: From Technical Choice to Strategic Enabler
The decision between SaaS and On-Premises ERP is one of the most consequential a CIO will make. Moving beyond the outdated CapEx vs. OpEx debate is the first critical step. The modern enterprise requires a decision-making framework grounded in a holistic view of total cost, control, security, scalability, and future-readiness. Using the 5-Factor Model presented here allows IT leaders to facilitate a strategic conversation, translating technical options into tangible business outcomes and risks. This ensures the final choice is not based on market hype or internal bias, but on a rigorous analysis of what best serves the organization's unique operational DNA and strategic ambitions.
Ultimately, the greatest risk lies not in choosing SaaS or On-Premises, but in choosing a rigid, monolithic platform that eliminates future options. The real-world failure patterns—from dogmatic cloud mandates to underestimated TCO—all stem from a lack of flexibility. The smartest path forward is to prioritize architectural choice. By selecting a modular, AI-enhanced platform like ArionERP that offers functional parity across both SaaS and On-Premises deployments, a CIO can effectively de-risk the decision. This 'choice-enabled' approach allows the organization to align the deployment model with the specific needs of each business unit, creating a truly hybrid environment that is both agile and controlled. It transforms the ERP system from a source of constraint into a flexible, powerful engine for sustained business transformation.
Your next steps should be focused on strategic alignment, not just technical evaluation:
- Conduct a TCO analysis for both models, using a 5-7 year horizon and including all 'hidden' costs like personnel, integration maintenance, and hardware refreshes.
- Map your critical business processes and identify which ones require deep customization versus which can adhere to standard best practices. This will clarify your true need for control.
- Assess your organization's security and compliance maturity. Be honest about whether you have the internal resources to manage an On-Premises fortress or if you would benefit from a vendor's specialized security posture.
- Challenge your team to think hybrid. Instead of a single answer for the entire enterprise, explore if a two-tier strategy—SaaS for some divisions, On-Premises for others—could be the optimal solution.
- Evaluate vendors on platform flexibility. Prioritize partners like ArionERP who don't force you into a one-size-fits-all deployment model, thereby preserving your strategic agility for the future.
This article has been reviewed by the ArionERP Expert Team, comprised of enterprise architects and former CIOs with decades of experience in rescuing and deploying mission-critical ERP systems. Our insights are drawn from real-world implementations across manufacturing, distribution, and service industries.
Frequently Asked Questions
Is SaaS ERP always cheaper than On-Premises ERP?
No, this is a common misconception. While SaaS ERP typically has lower upfront costs, the total cost of ownership (TCO) over a 5-10 year period can often be higher than On-Premises, especially for companies with a large or growing number of users. [18 SaaS subscription fees can escalate, and costs for integrations, customizations, and premium support can significantly increase the total spend. [23 An On-Premises solution has a high initial investment but can have more predictable, and sometimes lower, long-term operational costs once the initial hardware and licenses are paid for. [8 A thorough TCO analysis is essential.
Which deployment model is more secure, SaaS or On-Premises?
Neither is inherently more secure; they have different security models and responsibilities. On-Premises gives you full control over your security infrastructure, which is a major advantage if you have the expert staff and resources to manage it effectively. [5 You are responsible for everything from physical server security to application patching. SaaS security operates on a shared responsibility model. [28 The vendor secures the cloud infrastructure (a task they are highly specialized in), but you are responsible for securing access, configuring user roles correctly, and protecting your data within the application. For many companies, a reputable SaaS vendor's security posture is stronger than what they could achieve on their own. [16
Can I customize a SaaS ERP system?
Yes, but the level of customization is different from On-Premises. Most SaaS ERP platforms allow for extensive configuration, where you can change settings, workflows, and reports using built-in tools. However, they typically do not allow for deep customization, which involves changing the core source code of the application. [15 This is to ensure the vendor can push updates to all customers simultaneously. On-Premises systems offer unlimited customization potential, which is a key reason why companies with highly unique and strategic business processes may still choose this model. [7
What is a hybrid or two-tier ERP strategy, and why is it useful?
A hybrid or two-tier ERP strategy involves using different ERP solutions or deployment models for different parts of the business. For example, a corporation might run a large, legacy On-Premises ERP at its headquarters (Tier 1) while deploying more agile, cost-effective SaaS ERP solutions at its smaller subsidiaries (Tier 2). This approach allows organizations to get the best of both worlds: stability and control at the core, and speed and flexibility at the edges. A platform like ArionERP, which supports both deployment models with a consistent data structure, is ideal for implementing a seamless hybrid strategy.
How does the choice of deployment model affect AI and future innovation?
The deployment model has a significant impact on your ability to leverage AI. SaaS vendors are increasingly embedding AI and machine learning capabilities directly into their platforms and rolling them out via automatic updates, giving customers faster access to innovation. With an On-Premises system, you have more control to build your own proprietary AI models using direct access to the raw database, but you are also responsible for building and maintaining the entire AI technology stack. The choice depends on whether your strategy is to consume AI as a service or to build it as a core in-house competency.
Is your ERP decision locking you into yesterday's technology?
The future of your business depends on agility. A rigid ERP deployment model is a long-term liability. It's time to choose a platform that offers strategic flexibility, not architectural constraints.