A beginner’s guide to cloud HR software



Read time
10 mins


The right HR software presents organisations with a unique opportunity to optimise their HR operations, improving efficiency, security, and flexibility while providing valuable insights into their workforce

In this article:

What is cloud-based HR software?

So what is HR software? Cloud-based software for HR is a type of HR system that is hosted and delivered over the internet, rather than being installed locally on an organisation’s own computer servers. The software can be accessed and used through a web browser or mobile app, and typically offers a range of HR functions such as employee data management, storage of job and pay information to transmit to payroll software, benefits administration, and performance management. The key advantage of cloud-based HR software is that it allows companies to manage HR operations from anywhere and on any device with an internet connection.

What are the benefits of cloud HR software?

1. Accessibility

By leveraging cloud technology, cloud HR software (sometimes referred to as ‘SaaS HR software’) makes data easily accessible for anyone who needs it. This is especially important for those in HR, who must frequently make decisions based on this data. They can quickly access whatever information they need, no matter where they are located or what device they use. As a result, tasks such as payroll processing, recruiting, and onboarding new employees can all be handled more efficiently and accurately. Cloud HR software also helps ensure that everyone across an organisation has access to the same information, eliminating confusion caused by outdated or conflicting data held in disparate locations.

2. Scalability

Cloud HR software is designed to handle a large amount of data and can be easily scaled to meet the needs of growing organisations. This is especially useful for companies experiencing rapid growth, because it eliminates the need to continually upgrade or replace human resource management systems.

Cloud-based HR software can quickly adjust to changes in the number of employees, geographical reach, and other infrastructure and resource requirements. This allows businesses to experience improved efficiency, backed up by reliable data security – without needing extra IT resources or facing costly disruptions related to system upgrades. Thanks to its scalability, cloud HR software offers flexibility and agility while taking advantage of powerful workforce insights.

3. Time savings

One major advantage of cloud HR software is the automation of routine HR tasks, such as onboarding, time tracking, and performance reviews. This eliminates the need for manual, time-consuming processes and frees up HR professionals to focus on higher-level tasks. Additionally, cloud HR software provides a centralised platform for storing and managing employee information, making it easy to access information anywhere. This can be particularly useful for employees who need to access HR information on the go, as the software can be accessed through a mobile device.

Cloud HR software enables HR teams and employees to communicate and work together in real-time, reducing the time it takes to resolve HR issues and make decisions. Using cloud-based HR software streamlines HR processes and provides a more efficient and effective way of managing HR tasks, saving valuable time for HR professionals and the organisation as a whole.

4. Cost savings

Using cloud HR software is often more cost-effective for businesses than using an on-premise system because of the reduced infrastructure costs and scalability that it provides. With cloud HR software, businesses do not need to invest in expensive hardware, software, and maintenance costs, because the HR software vendor takes care of these expenses and maintains the infrastructure. This means that businesses only need to pay for what they use and can avoid the HR software pricing associated with an on-premise system.

As we’ve mentioned, cloud HR software can be easily scaled up or down as needed, allowing businesses to adjust their HR technology as their needs change. This is especially useful for growing organisations, which can add users and features as they expand – something that’s harder to do with on-premise HR software.

5. Increased security

Cloud HR software providers invest heavily in security infrastructure and employ security experts to ensure that their systems are secure. This includes implementing strong data encryption, regular security audits, and multi-factor authentication, among other security measures. In contrast, on-premise HR systems may not have the same level of security measures in place, as it can be difficult for businesses to keep up with the latest security developments and maintain the necessary infrastructure and staff.

Cloud HR software providers are required to comply with strict security and privacy regulations, such as the General Data Protection Regulation (GDPR). This provides an added layer of security for businesses, as they can be confident that their employee data is being protected in accordance with regulations.

Cloud HR software enables businesses to have access to their HR data from anywhere, at any time, through secure, encrypted connections. This is particularly useful for organisations with remote and hybrid workers, as they can access HR data from anywhere, without having to worry about the security of their data.

6. Improved data accuracy

Using cloud HR software can greatly improve data accuracy compared to traditional on-premise HR systems. One of the key advantages of cloud HR software is its centralisation of HR data, which makes it easier to manage, access, and update employee information. This eliminates the need for manual data entry and reduces the risk of errors or inconsistencies, leading to more accurate data.

Another factor that contributes to improved data accuracy with cloud HR software is the ability for HR professionals and employees to collaborate in real time. Self-service HR software empowers and enables employees to keep their own data, improving the quality of HR information held in your system.

Cloud HR software also includes automated workflows and approval processes, which help to ensure that HR data is accurate and up to date. For example, automated onboarding workflows can ensure that all necessary employee information is collected before the new starter’s first day, and transmitted securely and accurately into the central HR system.

Want to learn more about digital onboarding platforms? Discover if new hire onboarding software is right for you

7. Better reporting and analysis

Using cloud HR software delivers better reporting and analysis compared to traditional on-premise HR systems, due to its advanced data analytics capabilities (and more accurate data, which we discussed above).

As well as providing real-time data and insights into various HR metrics such as employee turnover, headcount, and performance metrics, the best cloud HR software – such as Ciphr HR – features advanced reporting tools that enables HR teams to create custom reports, dashboards, and charts to visualise HR data in a way that is meaningful for their organisation. And, integrating cloud-based HR and payroll software, for example, gives HR teams even greater insight into key trends, helping them to make data-driven decisions to improve HR processes and outcomes.

8. Improved employee experience and higher employee engagement

Using cloud HR software can increase employee engagement by providing employees with a more efficient, convenient, and accessible HR experience. Cloud HR software includes features such as self-service portals, where employees can easily access their personal HR information, request time off, and submit feedback. This empowers employees to take control of their HR experiences and reduces the need for HR professionals to handle routine HR tasks, freeing up time for more strategic HR initiatives.

Cloud HR software also provides employees with access to HR information and resources, such as company policies, benefits information, and training materials, which can help to increase employee engagement. By having access to this information, employees can become more informed about HR policies and procedures, leading to a better understanding of how HR affects their day-to-day experiences.

Cloud HR software enables HR professionals to communicate more effectively with employees, through features such as employee surveys and feedback forms. This provides employees with a voice in the HR process and helps HR professionals to understand and address employee needs and concerns, leading to increased employee engagement.

9. Better collaboration

Using cloud HR software enables better workforce collaboration by providing a centralised platform for HR information and communication. It allows HR professionals and employees to access HR information, such as employee records, company policies, and benefits information, from anywhere, at any time, using any device. This makes it easier for employees to collaborate with HR and with each other, regardless of location, leading to a more connected and engaged workforce.

Additionally, cloud HR software allows HR professionals to automate HR processes and workflows, such as onboarding, performance management, and offboarding, which can help to improve collaboration between HR and other departments. Automated workflows ensure that all stakeholders are informed and involved in any particular process, reducing the risk of misunderstandings and improving collaboration.

Selecting and implementing the best cloud HR software

Selecting and implementing HR systems can be a complex and time-consuming process, but it is important to get it right. Here are some steps that will help your organisation choose the best cloud HR software for you:

  1. Define requirements: start by defining the business’s HR needs and requirements, such as the number of employees, HR processes, and reporting requirements. This will help you build a business case for investment
  2. Research options: research and compare various cloud HR software options, including features, pricing, and vendor reputation. Consider conducting product demonstrations and reading customer reviews to get a better understanding of the product and vendor. Take a look at our list of essential questions to ask any prospective HR system vendor
  3. Create a shortlist: based on your research, create a shortlist of cloud HR software options that best meet your requirements. Consider factors such as the software’s scalability, security, and ease of use
  4. Select a vendor: choose a vendor that provides excellent customer support, has a proven track record, and whose product meets your needs
  5. Plan and prepare for implementation: plan the implementation process, including data migration, training, and testing, and prepare the necessary resources, such as IT staff, budget, and a project timeline
  6. Implement and train: work with the vendor to implement the cloud HRMS software, including data migration and testing, and provide training for HR professionals and employees
  7. Monitor and evaluate: continuously monitor and evaluate the performance of your new cloud HR software, and seek feedback from HR professionals and employees to make improvements

If you’re currently scouting the market for a new cloud HR systems provider, we hosted a free webinar that guides you through all the key steps necessary to build a process and identify features that are tailored perfectly for your organisation’s needs – allowing you to make an informed decision on this essential purchase.

Whether you need assistance selecting and implementing an HR system, or have already created your business case and are now ready to review the HR software market, we’re here to help. Get in touch today to request your personalised HR software demonstration.