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Considerations for Life after the HR Cloud Rolls In

julie fernandez
by Julie Fernandez

Software-as-a-service (SaaS) solutions for human resources (HR) are top of mind with leaders these days as the adoption of new technology from Workday, Oracle Fusion, SAP/SuccessFactors and others continue to take market share from traditional enterprise resource planning (ERP) platforms. Working through the business case and making an SaaS technology selection are obvious starting points, but many steps throughout the HR transformation journey need attention.

For those committed to an HR technology change now or in the near future, consider addressing the following Top 5 related concerns.

1. Extend portal and self-service technologies. Transitioning your human resource information system (HRIS) to the cloud is still just that – a systems transition. The success of Workday and other HR cloud systems is largely due to the appeal of the intuitive user interface and integrated reporting. But integration to systems and modules outside of the product suite remains a back office concern. Beyond self-service transactions, no cloud suite fully incorporates the communication and decision support tools, case management, imaging solutions, workflow tools and personalized portal content.

2. Consider shared services. SaaS is marketed as a pick-up-and-use tool, but it only works as such within the SaaS ecosystem. Some back office functionality, including interfaces to benefit providers and external learning/recruiting tools, is likely missing from your SaaS solution. Look for major human resource outsourcing providers to modify their offerings to provide fully functional shared services wrapped around the SaaS platforms to alleviate most of the administrative burden of HR delivery.

3. Solve for payroll. To date, the leading reason that payroll is excluded from the cloud suite is a lack of buyer interest in bringing any part of payroll administration back in-house. The market for stand-alone payroll outsourcing on the client SaaS module has been virtually non-existent until recently. What’s more, Workday’s payroll module has been limited to North America, but multi-nationals are showing a growing interest in global or regional payroll solutions in place of the many one-off country payroll providers and interfaces in place today. Expect new outsourcing solutions around these SaaS platforms to hit the market soon.

4. Revisit recruiting and learning. Workday and other SaaS HR systems lack a robust module for recruiting and learning. After delivering base functionality, including compensation and performance, it is quite natural to turn your attention to the fuller vision of integrated talent. Plan to evaluate Workday’s recruiting module to be released in the first half of 2014; consider recruitment process outsourcing for high volume or difficult hires; and determine how to incorporate formal and informal learning into the talent suite.

5. Establish governance early. Most companies are supported in transition by a systems integrator but fail to plan sufficiently for changes in the steady state. Many clients continue to rely on a systems integrator or high-cost consultant, while others struggle to confirm whether it is an HR or an IT role. Designate support responsibilities well in advance of go-live including internal staff responsible for ongoing configuration changes, upgrades and subscription volumes.

ISG is well positioned to support your company in evaluating cloud technologies tailored to your HR goals. For those ready to discuss your vision of a transformed HR, contact Julie Fernandez for strategic insight.

About the author

With more than 25 years of industry and consulting experience, Julie is an invaluable advisor for enterprises needing to evaluate and assess alternatives for multi-process HR service delivery, including workforce administration, payroll, benefits, compensation, recruiting, technology, learning, and talent management. Julie leads complex global HR assessments and transactions around the world. Prior to joining ISG, Julie worked for nearly a decade as an independent consultant, providing market research, vendor assessments, systems testing and implementation consulting to a broad community of benefits administration vendors and human resources departments. Julie started her career in human resources outsourcing, establishing shared service centers for a national benefits consulting and administration firm. She is a well-published thought leader in her field.