Cloud based Systems Vs Traditional Software

The whole paradigm of business and the environment around us is changing. You can’t deny the fact that we are living in a VUCA world (Volatile, Uncertain, Complex & Ambiguous) where rapid Technological advancements are paving the way for disruptions led by Social, mobile, Analytics and Cloud (SMACed).

Cloud computing, which was garnering $41B investment in 2011, is all set to cross $241B by 2020 as per Forrester estimates. Cloud computing enables users to store, access, manage, and share information via a network of remote servers that are hosted on the Internet, rather than on a local server. One example could be ‘Document Management’. Anyone with a Google account can store, access, manage and share documents uploaded to Google Drive by logging into their Google account online. Because all of the information sits on Google servers, you can manage them online using Google’s document management tools – with no need to download either the files or the tools. Isn’t that so much convenient?

The need for Cloud based solutions has arisen largely due to environmental, technological, and demographic changes happening around us. The 21st-century workforce is global, highly connected, technology-savvy and demanding. Its employees are youthful, ambitious, and filled with passion and purpose. The accessibility and connectedness of professionals online, through LinkedIn, Twitter and Facebook has made talent more accessible than ever. The SHRM Research on “Future HR Challenges and Talent Management Tactics lists “creating smooth and efficient HR processes that ensure a good employee experience” among the top challenges HR executives face in the current decade. Poorly thought out or poorly executed processes create a negative impression, hurt engagement and retention levels, besides unaffordable risks.

While accessibility is certainly a major benefit of cloud computing, there are two more reasons this trend is sweeping HCM: affordability and scalability. Most cloud solutions are offered as part of a subscription based software-as-a-service (SaaS) pricing model, which means Organisations aren’t required to make such significant capital investments up front. This has made modern HR systems far more affordable for even small organisations, many of which have been managing HCM process with homegrown systems or with no system at all. And because cloud-based systems are less customisable, they’re also easier to scale, easier to update, and easier to improve. This influx of HR tech users, combined with fast-paced innovation in cloud-based technologies, is powering a revolution in HCM, with demand only increasing for more advanced tools.

Second major trigger for Cloud-based HR systems is led by the “Consumerisation of IT”. HR Leaders and CXOs are realising the trend to move from “systems of record” to “systems of engagement”, since the end users of any HCM solution are not just HR folks but also the employees, who have completely different expectations from the technology they use. They want user-friendly interfaces and access to what they want and when they want via their device of choice. Traditional systems that don’t allow it, lead to their eventual disengagement. Companies are also stepping up their game in the push for mobile. The bar has been raised, and instead of mobile versions of a site or system, Organisations are rolling out mobile apps. Apps are easier on the eyes, simpler to navigate and generally more efficient.

I will like to conclude by saying that Cloud-based HCM solutions are the present and the future. The earlier we adopt, the better it is!

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Ajay Bhatia VP-Corporate HR & Global HR Head, Innodata Incorporation

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