Have you outgrown your on-premises HCM system? Discover how Cloud-based HR systems are changing the game
In this podcast, Sven Elbert, Head of Analyst Services at the Fosway Group, and Rachel Jordan, Unit4’s VP of HCM, discussed the topic of Cloud migration and the benefits of a Cloud-based HCM solution.
Below, we summarize the key takeaways of this discussion including the alignment of technology and business needs and how to keep pace with modern HR requirements with digital innovation.
How do organizations know they have outgrown their on-premises HCM system?
Often, organizational growth can be slowed, or even reversed, by a lack of investment in operational efficiency. With new opportunities come new challenges and it’s important to be able to read the signs when new tools may be required to confidently address change and growth.
There aren’t any obvious signs that your systems have become defunct. Often systemic failure can strike before these signs are obvious and many learn only when it’s too late.
However, to quote Sven Elbert “Unfortunately, there is no button that you can just press and that says have I outgrown my HR system”. Yet, the larger an organization becomes the more complex its HR requirements, whether that’s the result of organic growth, mergers, or acquisitions – this can be the most obvious sign.
One clear example, as Sven explains, is international complexity. On-premises systems require serious investment to deal with increasing complexity, often with diminishing returns.
Naturally, growing organizations will face stricter compliance burdens. Legacy systems such as Excel will also create compliance issues especially where data security is concerned.
As Sven explains in the podcast, the best tonic here is prevention and anticipation, when growth occurs it is the perfect time to reassess your current systems to see what’s working, what’s not, and where obstacles may occur. This kind of assessment can provide signs that you will outgrow your system before it occurs.
What to consider when reassessing your on-premises HCM system
When change occurs, it needs to be managed so that it doesn’t lead to systemic failure in your organization. Sven points out a few key areas that HR professionals should consider when assessing their current on-premises systems.
- User Experience – It’s clear in the podcast that user experience is one of the major reasons to change your HR systems. When your employees are looking to book time off, or any other HR process, they want to do this efficiently – so it’s worth understanding this process. Equally, modern talent has modern expectations of digital capabilities so new talent can be attracted by easy-to-use and modern processes.
- Security and Compliance – Embracing a larger workforce also means more security risks that need mitigation. This can be a large consideration when dealing with mergers or acquisitions as you could gain international employees with different data requirements and compliance regulations.
- Globalization – When many companies grow, they may take on new employees from other countries, and there may be international requirements and compliance that need to be met. Remote work has become an expectation among modern, and specifically global, employees. An on-premises system may struggle with a global setup as well as meeting global data compliance needs.
- Integrations – In the Cloud, integrations with third-party apps, even the ability to create bespoke integrations itself. A huge benefit of Cloud architecture is having a large API library to create a seamless experience with adjacent products and interfaces. Cloud architecture is hyper-scalable in that it can satisfy even small needs easily, while on-premises legacy systems can be rigid and lack integration customizations.
Why transition to a Cloud-based HCM solution?
Software as a Service (SaaS) is becoming the predominant model for good reason. One reason is that compliance with data security regulations is much easier with a Cloud model as data is more secure thanks to public Cloud providers such as Microsoft Azure.
Maintenance costs are reduced as customer support can be 24/7 and remote. Similarly, updates are continuous with Cloud software meaning critical patches are deployed quickly, providing your organization with high levels of security and functionality.
With an ERP solution, HR data can also be accessed by other departments such as finance and procurement. A single source of truth means that these departments can deliver reports to each other efficiently and reduce data consolidation times greatly.
Automation and integrated data can combine to allow HR professionals to make changes to organizational structures with the push of a button, reducing time spent on admin tasks.
Cloud architecture is also hyper-scalable as Rachel Jordan identifies:
As a vendor, we can adjust as needed, throughout the year, to the varied needs of a customer in terms of operations at scale […] You might have peak periods [and troughs] and we have ways of using technology and tools in a Cloud environment that you won’t find in an on-premises system.
By moving to the Cloud, you can ensure that your HCM practices can adapt to growth. Thanks to hyper-scalability within Cloud architecture, your HR solution can scale with your business. And with the right flexible platform you can adapt your application solutions to modern HR practices as they occur.
Through low-code configuration, you can be sure that your Cloud solution is uniquely fit for your organization, and you can customize this as necessary, allowing great elasticity and adaptability.
With modern HR requirements increasing, such as environmental, social, and governance (ESG) reporting will soon be mandatory, as well as existing GDPR worries, Cloud-native architecture can adapt easily to evolving HR practices, allowing users to create bespoke app integrations to satisfy complexities as they occur.
With the Cloud you can generally build better relationships with employees through transparent systems, this can help retain current talent with better conversations about performance management and will in turn attract new talent.
Modern talent will have more experience with digital systems and expect a seamless digital experience. This requires a large API library so that interfacing with adjacent third-party applications is easy and seamless, something on-premises systems struggle with.
How Unit4 can implement the Cloud solution you need
With 40+ years of experience implementing Cloud-based ERP solutions, you can be sure that Unit4’s HCM product can meet your organization's unique needs. Our ERPx service helps place your people back in the driving seat while streamlining your tech stack and your people management.
If you want to learn more about Unit4’s HCM product and more about why you might have outgrown your on-premises solution, you can hear the full podcast for free.
