How the cloud has made HR better

Gareth Cartman is a digital marketer with a particular passion for CRM, having worked with a number of CRM businesses.

You know the cloud has taken over when even the most reticent of industries – legal, financial – shift to the cloud, and even discuss Europe-wide private clouds specifically for their industry.

It seemed for a long time that the traditional reasons for moving to the cloud – i.e. reduced cost, increased flexibility – were the key drivers behind the shift towards cloud-delivered software, but some professions are seeing wider benefits. Let’s look at the example of Human Resources – another of those industries initially reluctant to move to the cloud, but one which has now embraced it.

The HR Cloud

It’s easy to see why Human Resources professionals were initially reluctant to move to the cloud – personal data (lots of it) – accessible through a username and password. Many were stuck in the era of paper and pen (coloured-coded paper, too, as I remember it).

Cost and flexibility, therefore, may have been drivers for a move to the cloud, yet were hardly compelling to those stuck in the ‘HR past’.

It’s a legal thing

Across both payroll and HR, legislation is forever changing. One government will enact legislation every 6 months, and the next government may repeal or enhance that legislation. In the past, those with HR or payroll software would have had to update their software manually – through CDs delivered by post – in order to stay compliant with the new legislation.

Failure to comply would mean potential fines from HMRC, or could mean overpayments or underpayments to employees, the latter of course resulting in disgruntlement and in many cases, departure to a more trustworthy employer.

Keeping up with legislation, therefore, was part and parcel of HR. It was, of course, a nightmare for those running the software.

This all changed with cloud-delivered HR software. The updates are just rolled out online, usually overnight, in time for the next pay run, meaning that the business could a) ensure that employees were paid the right amount and b) the company avoided fines.

It’s an engagement thing

I often go back to my days of colour-coded paper for holiday forms as an example, but it’s a good one (and it wasn’t so long ago). Forms would be lost, or worse, rejected because of the wrong colour paper. You were, of course, not informed of that rejection until the day before your holiday was due to start.

We tend to look back on the ‘paper’ days in a bad light, they weren’t all that bad, but they were prone to error. And that error would lead to serious disgruntlement. 

Marks & Spencer had similar problems in that each store had its own HR person, with their own HR rules. It was hard to manage hundreds of stores around the country when there was no centralised HR policy being applied. A HR system built to centralise these rules and regulations actually ended up solving another problem – engagement.

Getting holidays signed off quickly may sound like a small thing, but the culmination of small things being done correctly makes a big difference. Being able to apply for leave online, at home, and have it signed off within a guaranteed timeframe does a world of wonder for employee engagement.

And therefore, you might think, for sales of elasticated knickers.

The takeaway

We’ve (finally) reached a stage where the cloud is considered more or less default. On-premise has its place in some instances, but with CRM and the like shifting to near 100% cloud by 2020 (or 85%, according to some recent research), we’re nearly there.

To accelerate this, we need to take the HR angle and look at not just the cost savings and the flexibility, but the actual ROI and day-to-day business improvement. For HR, this was about avoiding fines, increasing compliance and boosting employee engagement. The cloud has done what on-premise (or paper) could not – it has actually made HR better. 

We can’t keep trotting out the same arguments about cost & flexibility, but we can start looking at tangible improvements. Who knows, we might actually be able to improve the cloud systems we’ve already got in place?

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