Are HR Cloud Systems Delivering Value?

The Last Few Years Have Seen A Huge Shift In HR Services And Products To The Cloud.

The last few years have seen a huge shift in HR services and products to the cloud. Cloud computing platforms have been accepted wholeheartedly by most, and many vendors have come up with innovative solutions to many pressing HR problems.

As per Deloitte’s Global Human Capital Trends Report, 2019, cloud-based human capital management (HCM) systems are not placing enough emphasis on complementary transformational activities such as redesigning the operational model, data architecture and user experience. Which is why their full potential is not getting realized.

Adoption of subscription based cloud systems were intended to reduce the need for IT to maintain HR software, and also improve the experience for employees and management. There have been varying levels of success in each of these areas. Let’s look at the reasons that the report states for such scenarios to arise –

• Distributed HR systems

Organizations still do not have a unified HR system. It’s wither a mixed set or a combination of cloud and on premise software, or no systems at all. As per Deloitte’s report, only 5 percent of organizations have a fully integrated HR cloud platform. And 29 percent have no systems at all. Because of so many multiple systems, the quality of the user experience and the level of integration have not reached the desired levels.

• Fast paced innovation

Technology in the cloud space is getting innovated with new features each passing day. Solutions get obsolete in as less as six months in the times we live in. Keeping up with the latest technological advancements and business innovation is not something most cloud vendors have been able to keep up with. Several vendors are now offering artificial intelligence (AI) based solutions which has put tremendous pressure on traditional ERPs.

• Overselling

Because of the intense competition and desperation to stay in business, most cloud vendors have also made the mistake of overselling their system’s capabilities. Most of the respondents in Deloitte’s survey said there was a mismatch between what was promised and what was actually realized.

Is Digital HR Just An Unfulfilled Adventure?

While there have been several examples of benefits derived by companies with cloud HR solutions, the data reveals that there is still a long way to go. Only 5 percent of respondents believe that their HR technology is doing an excellent job meeting employee needs. Even when it comes to areas of general productivity and information tools, many organizations are behind. Only 35 percent of respondents in the survey said they were satisfied with their organizations’ abilities to deliver the tools and technologies they need to do their jobs.

With hundreds of more vendors getting added to the list, the explosion of new HR tools is on the rise. These tools range from pulse surveys, feedback, engagement measurement, performance measurement, well being, recruitment and so much more. Robotic process automation (RPA) and artificial intelligence (AI) tools have also made inroads into HR. Virtual reality, machine learning and social collaboration tools is opening several doors for reinvention, rather than just automation.

Such fast paced development has truly given HR professionals a wide range of options to choose from. While the cloud solutions are still not always successful, it has build a foundation for organizations to learn from and plan better. The future will be one where AI and cloud will come together to offer solutions that are actually sustainable.