10 Ways Cloud HR Software Changed the Way Human Resources Works

April 15th, 2020

Human Resources is no longer confined in the back-office attending to piles after piles of paperwork. Thanks to the Internet and modern technology, HR has completely transformed into a tech-savvy department that takes advantage of cloud-based HR Solutions to hire, manage time-off, conduct onboarding and offboarding activities, and so much more.

The human resources department is usually a place of frenzied activity. Thanks to the benefits of cloud HR software, HR professionals now have the tools to reduce and simplify administrative tasks like payroll and record keeping. They can instead focus on issues that can make or break a company in this era of fierce competition— like employee engagement.

A Look Into 90s HR

In 1995, when a manager at one of Hannaford Brothers Co.’s grocery stores wanted to check his 401(k), he needed to dial into a voice-activated telephone system.

Interactive phone systems were at the heart of the 90s HR ecosystem. For many workers, the 16-line touch-tone system they used for HR purposes at the time was state-of-the-art. HR processes were run on big mainframes hidden in an air-conditioned basement somewhere under the office, while employee training and onboarding were presented on laserdiscs.

When we asked Vincent Tuccillo, director of Workday Implementation at Pitney Bowes, about the challenges he faced as an HR professional during this time, he highlighted one particular pain point: 

“You had to be an HR professional to update an HR record. You could be terminating an employee before the new hire record got into the system!”

From today’s perspective, HR in the 90s may look old school, but it was a necessary step towards where we are today. The pain around HR resources becoming a bottleneck gave employees a window into what “self-service” could look like. Within the span of a few years, HR professionals remember innovations like this: 

“It was miraculous that you could do HR work on a computer and not paper.”

Josh Bersin | President, and CEO of Bersin & Associates

These 10 Benefits of Cloud Software Changed HR Forever 

The HR software that emerged in the late 90s favored small businesses that desperately needed simple automation. As functionality became stronger and more complex, innovation slowly spread into larger enterprises.

Since the early 2000s, there has been a significant shift from the early “one-size-fits-all” HR software that had emerged in favor of specialized systems that can manage recruiting, training, evaluation, and other HR-oriented tasks. Cloud-based HR systems give businesses the computing power and the ability to survive and thrive in the information era.

Below, we’ll examine how the following benefits of cloud HR software have improved the workplace:

  1. Less paperwork
  2. Real-time and accurate performance assessments
  3. Increased employee engagement
  4. 24/7 access to pay and benefit information
  5. Fast deployment
  6. Cheaper HR solutions
  7. New approach to security
  8. Easy access to innovation
  9. Bringing HR up to speed
  10. Predictive analytics

#1 Less Paperwork

Gone are the years of storing employee records in large file cabinets. With cloud-based HR software, all files can now be stored securely in the cloud and accessed instantly with apps like Box, Google Drive, and Dropbox. Because data is stored digitally, an HR employee can search and print a file from a cloud HR solution in a matter of seconds.

As one reviewer explains, cloud hr software helped cut their paperwork by half: 

“ADP Workforce Now is great for large or small businesses. We are able to keep up with time cards very easily through the app and the online system. With over 300 employees, ADP has cut down paperwork for the HR/Payroll department by half. Most of the information employees need is available in one of the many sections of ADP. It also made open enrollment paperless and much easier to track.”

Krystal H. | HR/Payroll | Automotive | 201-500 Employees

#2 Real-Time, Accurate Performance Assessments

One of the critical functions of Human Resources is to assess employee performance. Assessments previously involved endless paperwork and took a lot of time to gather data. 

With cloud HR software, employee performance is tracked automatically in real-time. Data analyses leverage built-in dashboards and reports and machine learning. Cloud HR solutions help the HR team put the right new systems in place or provide additional training in just a matter of hours.

Today, there are more than 70 products that fall into the Employee Performance Management software category—a subset of cloud HR software that helps HR professionals track and leverage performance data. Here’s what one reviewer had to say about running performance assessments with Ultipro, a Top Rated product in this category:

“With Ultipro, we have been able to automate multiple HR processes that has given the time back to our HR team to focus on more strategic initiatives. They no longer have to worry about status changes, benefit changes and updates, launching performance reviews and several other features that we have been able to automate through Ultipro.”

Patrick C. | HR Generalist | Individual & Family Services | 501-1000 employees

#3 Increased Employee Engagement

Cloud HR systems take advantage of big data and mobile technology to engage employees. For example, in just a matter of minutes with a tool like Ceridian Dayforce HCM, HR can send out a pulse survey to employees to collect feedback on how the company can serve them better. Cloud HR systems can also help track hours, and manage employee payroll.

Without question, HR teams have learned during the past decade that employee engagement is a crucial source of competitive advantage. Engagement drives high levels of customer satisfaction, knowledge sharing, interest from new applicants, business agility, and bottom-line profitability. When used effectively, HR software like Trinet or Oracle HCM Cloud can be used to help humanize the workplace and improve long term retention.

#4 24/7 Access to Pay and Benefit Information

Cloud HR software allows employees to access critical information about their pay and benefits anytime, anywhere. They can easily see how much of their salary goes to taxes, 401(k), and more. 

With more dated HR systems, employees usually accessed HR information via phone systems. These systems may not be available at all times, take up more space, and may not have the bandwidth that cloud HR systems have. Cloud HR systems allow constant access at any time.

Cloud HR systems also make it easier for employees to change pay and benefit settings. An employee using a cloud HR system can set up direct deposit, change their health insurance and more without help from an HR professional.

#5 Fast Deployment

HR software as a service is easy to deploy and manage. Based on end-user feedback in reviews, it’s also more straightforward compared to standalone or legacy HR systems. With HR software as a service, you don’t have to worry about any security updates or maintenance, as these tasks are managed by the SaaS provider.

One reviewer of the TriNet platform found that this software was particularly easy to implement and maintain because of the high-quality customer service they were provided:

“TriNet provides us with everything we need: an on-line HRIS system that is user-friendly for both HR and the employees, a cost effective benefit program, payroll administration and even a time and attendance solution. I work with the best customer support team I have ever experienced and can rely on them for great advice and guidance on issues that come up in a timely manner.”

Diane G.| Director of Human Resources | Hospitality IT | 51-200 employees

#6 Cheaper HR Solutions

Cloud-based HR systems offer more value for lower upfront costs than proprietary HR management software. Once deployed, cloud solutions immediately begin generating decent returns, including better data and time savings. This means that your company has more resources to improve products or to focus on employee satisfaction.

Cloud HR solutions provide self-service features for employees. These features allow employees to accept and make changes to their benefits on their own. Self-service features lowers the workload of HR professionals, meaning fewer HR staff will be needed to manage the HR system. With cloud HR systems staff can instead focus on other HR needs.

#7 New Approach to Security

Before cloud-based HR, security meant using durable padlocks and fireproofing archives. Because employee records are now stored digitally, companies need to rethink how to keep sensitive information safe. Data security is particularly relevant for international businesses because of the GDPR law across Europe. The GDPR redefines personal data and holds companies accountable for protecting the personal information of employees.

The good news is that most cloud HR software companies take security seriously. They conveniently have all the latest mechanisms in place to safeguard your company’s sensitive data. As a result, security is on them, not you, to maintain, even as regulations change. 

#8 Easy Access to Innovation

What happens if your proprietary HR management software gets outdated? Upgrades, deployment, and training can easily ramp up the total cost of ownership. Thanks to cloud computing, startups and big corporations now have equal access to innovation in cloud HR solutions. The cloud provides an easy way to update solutions. This means companies no longer need to invest extra in software or technology continually.

Access to innovation levels the playing field by allowing small companies to compete with big corporations by staying ahead of technology trends — adapting to changes and adopting new solutions as they move forward.

#9 Bringing HR Up to Speed as a Strategic Department

Perhaps the most significant impact of cloud-based HR systems is the ability to close the gap between the HR team and the rest of the organization. HR has traditionally always been at the back-office, suffering from delayed information and a severe communication gap.

Today, with the mandate to improve employee engagement and develop winning workplace cultures, the HR department has to be at the forefront — leading the way. Thanks to cloud computing, this is now possible. Data is centralized and more accessible, reporting is instant, and analyses of trends and information is much easier and faster. With these tools, HR can effectively lead the way in making better decisions to improve recruitment, retention, and performance of employees.

#10 Predictive Analytics

Once hired and working, AI in HR systems can help with employee retention and promotion issues. By looking at data across the company, AI can predict which employees are at risk of becoming dissatisfied and proactively address the issue. For example, it may surface a performance dip for lack of training, a workplace environment issue, or other matters. These HR solutions will detect and remedy employee issues before they lead to someone quitting or losing productivity. Though this is still emerging technology, experts explain why it’s so exciting and predict it will be key to HR’s strategic role in keeping businesses competitive:

Eva Wislow, writing on the Big Data Made Simple website explains:

“As much as it is difficult to hire talented employees, it is as difficult to keep them in your team. This is why almost 60% of organizations consider employee retention their biggest problem. However, AI has the ability to analyze and predict the needs of staff members.

It can determine individual affinities and reveal who should get a raise or who might be dissatisfied with the life-work balance. Such analysis gives room to HR professionals to be proactive and solve the problem even before it actually occurs.”

Or as Bill Carmody, the founder and CEO of the US marketing company Trepoint wrote about AI in HR for Inc.com:

“When you have thousands of employees, you have a wealth of data flowing inside your company. Predictive analytics decodes and deciphers that data in order to provide the kinds of insights you need to say predict when you’re going to need to hire more people in different regions of the world.

Or perhaps you’d like to be alerted when a key strategic hire may be looking to quit his or her job. With the right machine learning, you can start to capitalize on all the historical data and the predictive nature of how individuals come in, grow and eventually leave your company.”

The Future of Cloud-Based HR Software as a Service

According to a 2017 study by Deloitte, many HR programs are now leveraging digital and mobile tools. 41% of the HR teams surveyed were actively working to create mobile apps, while others leverage social media to deliver HR information. Additionally, 33% were using some form of artificial intelligence technology to deliver HR services and solutions. This continuous innovation and expansion of HR software can give you an idea of where cloud-based HR software is heading. There is now more of an effort to make services accessible and easy to use by all employees.

If you haven’t made the switch to cloud-based HR management already, you’re behind the curve. According to a survey by SelectHub, 100% of surveyed HR software buyers were open to cloud solutions, and access to the cloud was the number one sought after feature from surveyed buyers. SaaS HR tools consolidate HR functionalities into a single cloud-based app that can be more easily implemented than a traditional on premise solution.

Top requirements for HR Software Buyers graph
Source: SelectHub

Cloud based HR systems have also embraced automation, allowing HR staff to save time and employees to serve themselves. Using Saas HR software, organizations can leverage all in one, automated systems to reduce HR labor and enable employees to access payroll and benefits information with minimal training. 

13 Cloud HR Solutions to Help Your Company Succeed

The HR space has become an incredibly crowded market with literally hundreds of solutions to choose from, which can make it hard to differentiate between products and figure out which one meets your company’s needs.

One way to help narrow down your search is by using your network to see what software other HR pros recommend. TrustRadius’ community of HR professionals has generated over 5,000 software reviews to help make the product selection process a little less overwhelming.

Here is a shortlist of the most used cloud-based HR Management products on TrustRadius:

SoftwarePriceProsConsBest ForRatingsReviews
UltiproQuoted+Simple onboarding+Good Customer Support-System Processes can be slow-Limited Reporting optionsLarger companies with the resources to manage many features8.7Click Here
TrinetQuoted+User Friendly Interface+Thorough training available-Slow customer support response time-Limited support for government work regulationsBusinesses that don’t work with government contrats or contractors8.4Click Here
Ceridian DayforceQuoted+Strong Reporting Features+Easy to use navigation-Limited Training for users-Dashboards are difficult to customizeLarge enterprises with many employees8.1Click Here
ADP Workforce NowQuoted+Easy access to paperless information+Wide variety of prebuilt reports-Exporting information is slow-Custom reports are not user friendly to buildSuitable for small and large organizations7.8Click Here
Oracle HCM Cloud$13/mo/employee+Robust custom form options+Detailed documentation for all features
-Form customization requires a technical user-Implementation can be tricky and may require supportIdeal for businesses with many HR systems they want to consolidate7.7Click Here
Kronos Workforce Ready$6/mo/employee+Easy to use payroll processing+Easy to use Mobile Application
-Limited Dashboard Customization-Time management could be more streamlinedIdeal for businesses with large amounts of employees7.9Click Here
Workday HCMQuoted+Easy to create and review PTO requests+Clean user interface for administrators-Interface for users can be confusing at first-Limited training featuresIdeal for very big enterprises, can manage large amounts of employees8.2Click Here

Curious about how these products stack up against each other? Read reviews on TrustRadius to see what fellow HR professionals think of these 13 solutions. 

Next Steps in Cloud HR

Cloud HR has become the standard in HR technology, but it’s still making advancements to better meet the needs of users. According to SelectHub research, the biggest failings of HR systems are lack of features, lack of automation, and lack of centralization. 

Top failures by HR Software Vendors graph
Source: SelectHub

As a result, cloud-based HR platforms are beginning to package more features into single products rather than offering suites of different products, and are adding new features such as automated reporting. Vertical specific HR software developed to meet the specific needs of an industry are also becoming more common.

When considering what HR Management software is best for your business, there are a lot of factors to consider. Our Buyer’s Guide for HR Management Software covers all the major do’s, don’ts, and difficulties of buying HR software so that you can find the best product for your needs and trust your decision.