Is your organisation embracing the culture of the cloud?

Two thirds of large organisations are now using cloud applications for managing people information as HR and business leaders recognise the benefits of the technology. Are you in the minority that are being left behind?

PwC’s latest global HR Technology survey tells us that over 70% of organisations have some HR applications in the cloud. And there are no signs of cloud adoption slowing down - last year 23% of companies used SaaS (Software-as-a-Service) for core HR and another 26% planned to move within three years. Fast forward a year, 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.

So what’s behind this shift to the cloud? Organisations are dealing with the reality of a digital-native workforce and the increasing pace of change driven by changes in demographics, emerging markets and new technology. To be competitive, it’s essential to stay relevant and it’s expensive and time-consuming to do this in-house.

True competitive advantage from people has always come from focusing on the human aspects of the workplace, such as a strong culture, great people managers, positive employee experience and empowerment. However, historically, organisations have focused on deploying systems with highly-customised people processes (such as recruiting or performance management) in the belief that this would deliver significant value. While some benefits were realised, the legacy systems and processes that remain cannot keep pace with change – leaving a sort of organisational scar tissue.

The latest HR cloud applications bring simple and standard processes from the “outside in” while using the best of the consumer internet – social, mobile and analytics – to make it easy for managers and employees to quickly start using them. Rather than asking “How do we change the technology to make it work for us?” leading HR and IT professionals are now asking, “How do we change what we do to get the best out of the technology?” This commoditisation of people processes through the cloud is helping businesses focus on things that really make a difference – such as culture, innovation, customer experience and brand.

The benefits of this shift are significant. The cloud enables employees to have information at their fingertips, whenever and wherever they need it. This means that leaders can have people information 24/7, and direct access on mobile devices means that no-one has to wait to get tasks done on the move. Managers can collaborate more effectively to get the right people doing the right things for their customers. And because cloud applications are continuously improved without the need for large scale re-engineering, they stay relevant over time.

The shift to the “culture of the cloud” we are all experiencing in our personal lives enables people and organisations to work in a more effective and agile way. To fully reap the benefits, CHROs need to be considering these cultural and organisational implications and how the shift to the cloud can be a catalyst for driving real competitive advantage. The businesses who get this right will be poised to outperform their peers and for bigger returns in the years ahead.

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