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What is cloud HR technology?

After months of heroically keeping their teams equipped, connected, and motivated amid huge challenges many HR leaders are rethinking their strategies and tech options. But is cloud HR the right direction to travel – and what benefits can you expect?

In many areas of the organization, the advantages of the cloud are widely accepted. The move away from on-premise tech typically helps organizations increase scalability, strengthen continuity, boost security and compliance, and improve overall manageability. Added to that, there's the speed of implementation, rapid updates, and new subscription models.

But what about HR? Which challenges could the cloud solve if your HR suite and services were hosted and managed in the cloud? And if the speed of change continues world-wide, how might cloud HR technology improve the role of HR leaders, support employees, and lead to greater performance?

For the answers, we need to examine today's HR legacy systems – and whether their drawbacks could be overcome by switching to cloud HR. But it's also important to look beyond today's issues and imagine how you could adapt quickly to tomorrow's rapid changes. Here are three areas to consider:

1) Outstanding employee experiences

Many organizations have been constricted by their legacy HR systems — or alarming gaps in capability have appeared – just at the time when remote working and collaboration was needed most. Keeping everyone engaged and working as one has been a strain for many teams.

For employees especially, this has created huge frustration. From using their own consumer tech, they know what kind of experiences are possible – from secure remote access to empowering self-service. In the consumer world, they'd simply switch providers whenever shortcomings appear. The danger is that top talent adopts the same mindset at work – and people quit.

So, it's no wonder that many organizations are now increasing their focus on the employee experience. In fact, 64% of HR leaders are prioritizing employee experience more highly now than before the coronavirus outbreak, according to Gartner.

Many executives have realized that a great people experience boosts employee engagement, improves employee retention, and impacts performance.

Innovative cloud HR technology can match and sometimes exceed consumer-like experiences – bringing the best from people, wherever they work. Put simply, a cloud HR platform serves as a springboard for success.

2) The ability to adapt quickly with cloud HR

As many HR leaders will know, the complexity and speed of change has increased exponentially – and there's no sign of any slowdown. Antiquated HR systems have failed on many fronts. Problems around secure remote working, access and collaboration are the obvious instances. But as organizations have adjusted their own objectives and ways of operating, more cracks have appeared in legacy workforce solutions.

In a recent global survey of financial leaders across most industries, 71% of CFOs surveyed believe that digital transformation investments are key to their organization’s  success. Interestingly, one of their primary considerations for IT spending was to prioritize projects that yield positive outcomes.

For HR teams, this is an area where cloud HR technology can deliver significant, tangible benefits. Very quickly, your HR services can prove nimble, easy-to-use, and adaptable – supporting and enabling your improvement strategies, thanks to widespread digital engagement. Using cloud HR, leaders can create, roll out, and configure services that empower employees rather than holding them back. You can demonstrate engagement too.

3) Immediate insights and better decisions

Modern organizations rely heavily on relevant, real-time data to power their decisions. But typically, legacy HR systems hold important data in silos. Useful insights are inaccessible, buried, and disconnected. This can lead to poor decision-making around HR resourcing, performance, and a host of other areas that will have a direct impact on budgets.

Executives recognize the problem. In one of its Global Human Capital Trends reports, Deloitte noted that only 11% of organizations said they were able to produce information on their workforce in real time.

However, the best cloud HR systems work as part of a unified cloud platform that shares real-time information, so your HR leaders have better insight and can become more effective. By relying on a common data source, you can better understand and support the employee experience across a national or global workforce.

Taking this approach with HR yields remarkable benefits. But even more insights are available when organizations go further – by creating a people experience suite that also includes your ERP and financial planning and analysis (FP&A) software. Data then gives you the greatest insights for better decision-making across your enterprise.

What does cloud HR look like in practice?

It's easy to see cloud HR as an abstract concept alongside a strategic vision and headline benefits. But how does it feel on the ground? Here are some practical examples of what you might expect from leading HR software, delivered via the cloud.

Expense management: This becomes far easier for staff, who can submit details via the cloud-based system using their mobile phones. The registration, approval, processing, and payment of travel expenses can be automated in many ways. Using the cloud platform, data can be fed directly into your financials and linked with projects.

Absence management: People can submit their holiday requests, while managers log any absences. Using cloud HR technology, you can go beyond basic functionality to identify trends and costs. You can link your insights with work plans, projects, and payroll.

Payroll: The best cloud HR will fit your organization, even if you have multiple departments or manage a multi-authority shared service with different legal implications. The tech can deal with the complexity for you. Everything can be synchronized, while changes to positions, pay grades, and pension schemes can be reflected automatically.

Talent management: Recruitment tools can be integrated so you can maintain a seamless flow of applicants through the recruitment process and then into your HR and payroll systems. That way, new hires can have a great experience from the start.

Performance and engagement: With more data on each employee via the cloud HR platform, managers can improve their feedback and development, so employees feel better understood and supported. You can use mini surveys to glean immediate, anonymous feedback at key moments in your organization’s journey or during the development of a team or project.

Skills and learning: With cloud HR technology, you get a more complete understanding of your people's skills and competencies. HR and managers can build job competency frameworks and provide training to fill gaps. People can access online learning more easily and take it at their own pace. Self-service tools mean they can build and manage courses in a way that's personalized – and all from the same dashboard.

Insights: The right cloud HR platform can give you access to hundreds of reports from across your organization on everything from wellbeing to workforce costs. This helps you to steer your strategy and make your organization more resilient and successful, no matter what change is around the corner.