*This article has been updated on May 30th, 2019 based on new research conducted by the TrustRadius team*
Today, 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 software 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 technology, HR professionals now have the tools to reduce and simplify administrative tasks like payroll and record keeping. They can then focus on issues that can make or break a company in this era of fierce competition — employee engagement.
A Look Into 90s HR
In the 90s, 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 are at the heart of the 90s HR era. For the 15,000 workers of The Scarborough in Maine, the 16-line touch-tone system they used to check on their medical certificates was, at that time, 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.
“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!”
–Vincent Tuccillo on one of the challenges he faced as an HR professional in the 90s.
From today’s perspective, HR in the 90s may look very 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.
10 Ways Cloud HR Software is Changing the Workplace
We are living in a very fast-paced world. Any organization that still runs with 90s technology will surely get left behind — if they even still exist today. The HR software that emerged in the late 90s favored small businesses that needed simple automation. It slowly spread into larger enterprises, as functionality became stronger.
“It was miraculous that you could do it on a computer and not paper.”
–Josh Bersin, President, and CEO of Bersin & Associates.
Since the early 2000s, there has been a major shift from the early “one-size-fits-all” HR software that had emerged in favor of specialized systems that could host the 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.
Cloud HR software has changed the workplace for the better in several ways. And some of them are:
- Less paperwork
- Real-time and accurate performance assessments
- Increased employee engagement
- 24/7 access to pay and benefit information
- Fast deployment of HR systems
- Cheaper HR solutions
- Changing the way workplaces think of security
- Giving companies easy access to innovation
- Bringing the HR at the forefront of the competition
- Predictive analytics – AI that promotes employee retention and loyalty
Let’s dive in a little deeper to see how this type of software can greatly benefit your HR department.
#1 Less Paperwork
Gone are the years of storing employee records in large file cabinets. Not to mention the frantic search that comes with it every time a certain file is needed.
With cloud-based HR software, all files and paperwork can now be stored securely in the cloud with apps like Box, Google Drive, and Dropbox. And because it’s digital, an HR employee can search and print a file in a matter of seconds!
HR software with seamless cloud storage integrations can help you keep every record organized, secure, and easily accessible.
#2 Real-Time, Accurate Performance Assessments
One of the key functions of Human Resources is to assess employee performance. Assessments previously involved endless paperwork and took a lot of time to gather data. Data analyses and implementation of the necessary training or systems to address a concern took ages too!
With cloud HR software, employee performance is tracked real-time. Data analyses are done in a swoosh, often leveraging built-in dashboards and reports or even big data trends and machine learning. This helps the HR team put the right new systems in place or provide additional training in just a matter of hours.
#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, HR can send out a pulse survey to employees to collect feedback on how the company can serve them better.
Why is the lack of employee connection a concern? Without question, HR has learned during the past decade that employee engagement is a key source of competitive advantage. In fact, engagement drives high levels of customer satisfaction, knowledge sharing, interest from new applicants, business agility and bottom line profitability. Engaging employees and giving them a secure channel where they can give their feedback is a huge help with employee retention as well.
#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. And this is done in real time and without the hassles of traditional practices.
#5 Fast Deployment of HR Systems
Even with the latest technology, implementing a new management system in the workplace can take up a lot of time and money. With cloud-based HR systems, that should not be a problem.
SaaS HR software is easy to deploy and manage. It is also more straightforward and easier to understand compared to standalone or legacy HR systems, based on end-user feedback in reviews. Moreover, you don’t have to worry about any security updates or maintenance, as these tasks are managed by the SaaS provider.
“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 Gomez on TriNet, Director of Human Resources, DCI – Design Communications / Ethostream
#6 Cheaper HR Solutions
Proprietary HR management software is ridiculously expensive! Not to mention the installation and training costs. Cloud-based HR systems, on the other hand, offer more value for lower upfront costs. Once deployed, the software immediately begins generating decent returns, such as better data and time for more strategic tasks. More savings means that the company has more resources to improve its products or improve the welfare of its employees.
#7 New Approach to Workplace Security
Before cloud-based HR, security meant using durable padlocks and fireproofing archives. Today, security takes a different form — digital. Because employee records are now stored digitally, companies need to rethink how to keep sensitive information safe. This is particularly relevant because of the recent implementation of the GDPR law across Europe.
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. The cloud provides an easy way to update solutions. This means companies no longer need to invest extra in a software or technology on a continual basis.
This 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 biggest 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 – AI That Promotes Employee Retention and Loyalty
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
According to a 2017 study by Deloitte, many HR programs are now leveraging digital and mobile tools. In fact, 41% of the HR teams surveyed were actively working to create mobile apps. 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. I think nothing sums up the growing need for cloud HR software better than these words from Jason Averbook, Chief Innovation Officer of Knowledge Infusion, as published in Forbes:
“In this new era of the cloud computing when all we need to access these collaborative new technologies is a device we can purchase at a convenience store, and can begin to use without training of any kind, boundaries are eliminated and possibilities become endless.
If HR and business leaders resist this kind of thinking, the disadvantage they will find themselves at is much greater than that of legacy technology holding them back. Ignoring the cloud will truly limit the organization’s survival in this new world, in a very short period of time.”
13 Solutions to Help Your Company Capitalize on Cloud-Based HR
Now that we’ve walked through all the ways that cloud-based HR software can help your business save time and money, I bet you’re wondering – which product should I pick? 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 use the most and like the best. TrustRadius’ community of HR professionals has generated over 5,000 unbiased 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:
Ultipro (571 reviews)
TriNet (362 reviews)
Ceridian Dayforce (228 reviews)
ADP Workforce Now (222 reviews)
Oracle HCM Cloud (148 reviews)
Ascentis (112 reviews)
Paycom (77 reviews)
Paycor (71 reviews)
Kronos Workforce Ready (66 reviews)
Workday Human Capital Management (62 reviews)
Zenefits (47 reviews)
ADP Vantage HCM (38 reviews)
BambooHR (29 reviews)
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. You can also check out our free Buyer’s Guide for HR Management Software for an in-depth look at the do’s, don’ts, and difficulties of buying HR software.