Yaniv Ben Hemo explains what event-driven architecture is:
First things first, Event-driven architecture. EDA and serverless functions are two powerful software patterns and concepts that have become popular in recent years with the rise of cloud-native computing. While one is more of an architecture pattern and the other a deployment or implementation detail, when combined, they provide a scalable and efficient solution for modern applications.
Click through for a primer on event-driven architecture. This is a pattern that I find quite useful for optimizing cloud pricing, assuming your normal business processes can run asynchronously—that is, people are not expecting near-real-time performance and you can start and stop processes periodically in order to “re-use” the same compute for multiple services. The alternative use of EDA is that your services need to be running all the time, but you also have multiple teams working together on the solution and you want to decouple team efforts. In that case, you define queues or Kafka-style topics and let those act as the mechanism for service integration.
This is definitely an architecture that works better for cloud-based systems than on-premises systems.