Office 365是SaaS，它提供了MS Office套件的在線版本。而Office 2016是內部部署軟件，需要安裝和運行。
on-premise: the software runs on some hardware which is located in your own house, building, company, etc.
SaaS(= short for "Software as a Service*"): the software runs somewhere (typically in "the cloud"), where you as a user of the softwre don't really know (care?) where the hardware it's running on is located.
In the context of DevOps, let's assume you want to use GIT (and you know what GIT is used for): how are you going to make your GIT repositories available for other users to share your code. Are you going to use infrastructure (eg: some server) that you manage yourself, in your own building (= roll your own cookies), or do you rather want to "outsource" all that (e.g. because you do not have the skills or resources) and use something like GitHub?
Assume you want to start using "the Cloud" for sharing files, pictures, contact data, etc with other people. Are you going to use any of the available Cloud services (with all sorts of "strings attached" like fees, terms & conditions, etc.)? That would be the Saas version of it. Or do you rather want to be in full controle of it all (the server on which it is all stored/managed) and use something like (open source based) OwnCloud or NextCloud, running on a server in "your" house, building, etc. In this case "you" decide about what the terms and conditions are, and the only kind of fees you'll be facing is the cost to create and operate your own server (and manage the users allowed to access it). This is clearly the on-premise version.