The first concern most clients raise about AI is data security. It is the right concern. The good news is that safe designs are well understood, and the choice between hosted and self-hosted models is only one part of them.
Hosted AI models
Models from major AI providers, used through business APIs. They offer the strongest capabilities, need no hardware and are billed per use. Business API terms typically state that customer data is not used for training, and we review these terms with clients.
Self-hosted models
Open models running on your own servers or a private cloud, using tools such as Ollama. Data never leaves your environment, which suits strict policies. The trade-offs are hardware cost, maintenance and usually lower capability than the best hosted models.
Security that matters in either case
- Least access: the AI only reads the records the user is allowed to see.
- Minimal data: send only the fields needed for the task.
- Human approval: no messages sent or records changed without a person.
- Logging: every question, answer and action is recorded for review.
- Masking: sensitive values such as salaries or ID numbers can be hidden.
How we choose
For most ERP and CRM assistants, a hosted model with strict access controls is effective and affordable. For highly sensitive data, such as HR or patient records, we consider self-hosted models or a hybrid where sensitive steps stay in-house.
Frequently asked questions
Can we switch models later?
Yes. We design the integration so the model can be changed without rebuilding the agent.
Related reading
For the product view of this topic, read Hosted AI vs Self-Hosted AI Models for ERP Data on the Reckon ERP blog.
Planning a project? Book a free consultation with our team, or see our AI agent development service.
