Last year 23% of companies used SaaS (Cloud Software-as-a-Service) for core HR and another 26% planned to move within three years. Fast forward just one year and the number using SaaS for core HR has climbed to 44% with an additional 30% planning to move in the next one to three years.
While a primary motivator for migration to the cloud is reduced dependency on IT, companies must not make the mistake of thinking that IT skills are no longer necessary. While cloud removes the need for IT around customization development and environment maintenance, IT still plays a key role. Other key motivators included driving down total cost of ownership and having more frequent access to software innovations.
Most organizations are happy with their decision to move to HR the cloud. Operating in a cloud environment, however, is an adjustment; 25% say the incorporation of frequent, new releases requires additional staff to support and 36% note that new releases that bring desired enhancements often destabilize their environment. Top barriers to implementation include the organization’s willingness to adapt to delivered cloud processes, products that often under-deliver, and maintenance schedules that can disrupt operations.
The use of cloud technologies for HR is broad and growing, and the number of available vendors and solutions is expanding. When selecting a vendor, communicate (while making every effort to limit) your non-negotiable requirements, understand the vendor’s longer-term product strategy, the other offerings in the product portfolio that may be deployed down the road, their approach to issue resolution, and their release and maintenance schedules. Many organizations are focused on consolidating their vendor portfolio; 40% of the respondents are planning to use fewer vendors. Top motivations for consolidation included easier vendor maintenance and product management (61%), better support (60%), and better integration (47%).
Leaders must push their organizations to be more bold and ambitious in mobile deployment. When deploying HR applications to employees and managers in the field, companies should adopt a “why not mobile?” mantra that encourages the constant expansion of tools and functionality. As an example of pent up demand, 59% of respondents felt it would be beneficial for employees and managers to be able to use their mobile device for performance feedback. Yet only 18% of companies leverage mobile for the performance management process.
HR Analytics is not getting the focus it deserves; 52% do not have a dedicated HR Analytics team and nearly 40% do not have an HR Analytics strategy.