Not all HR software is created equal.

There are two basic types for small business owners: software you purchase and install on a computer or software that lives in the cloud and is accessed through a website. Though the functionality is basically the same, cloud-based HR software offers significant advantages over its installed counterpart.

If you’re considering new HR software systems, this overview should help you better understand the cloud.
At a conference in 2006, Google’s Eric Schmidt made a reference to Google services as belonging “in a cloud somewhere.” Since then, Schmidt has widely received credit for coining the phrase “the cloud.”

What Is the Cloud and Why Do I Need It?

The cloud is just a new way of delivering software to you. Instead of purchasing software at a store, inserting a CD-ROM into your computer and loading the software onto a hard drive, cloud-based software allows you to purchase and access computing capability through a website. There’s no physical product to buy or installment hassles with cloud-based HR software; you just log in through a Web browser and start working.

Why is this such a big deal? Let’s look at a five ways cloud-based software can support your HR efforts.

Advantage #1: Instant Access from Anywhere

If you currently keep paper records for employees, moving to online HR software lets you empty those filing cabinets and manage information more efficiently. Desktop software is a consideration, but you only have access when sitting in front of the computer that hosts the software. You’re not tethered to a single computer with cloud-based HR software. Because the software runs through a website, you can review employee records from any computer in the world, as long as you have Internet access. No more waiting until you get back to the computer in your office to use the software.

Advantage #2: Employees Can Lend a Hand

Cloud-based HR software allows you to provide administrative rights to multiple people, if you desire, without having to purchase multiple copies of software and a local server. In addition to the ability to customize admin access and what admins have access to, you can provide employees access to enter or update personal information and manage such things directly through the website.

Another Advantage:

    Employees can access the website from a variety of web browsers on a Mac, PC, tablet or smartphone.

Advantage #3: Say Goodbye to the IT Guy

You never have to worry about updating software with cloud-based access. The software company consistently provides updates behind the scenes so you always have the latest version. With traditional desktop software, you need to purchase updates every few years, which can be costly if more than one employee needs access to employee records. And you don’t need to worry about adding storage space on your desktop or dedicated server. Everything is stored in the cloud — data and the software you use to manage it.

Advantage #4: Accident-Proof Your Data

For companies that still use paper systems, that information is at risk in the event of a fire or other natural disaster. The same holds true if you use traditional desktop software. If the information is hosted on one computer, and that computer is damaged in any way, you may lose everything or have to pay a lot to have it retrieved by experts. With cloud-based HR software, once you enter data into the system, that data is stored securely on remote servers managed by the software provider.

Advantage #5: Confidential Info Has Never Been More Secure

One of the biggest concerns business owners have when considering cloud-based software is data security. Can my information be hacked? Can it be lost if the host servers are compromised? To put you at ease, cloud-based HR software providers maintain the highest business standards and certifications for database hosting and backups, user access and data encryption. When you think about it, storing data on paper in filing cabinets or on a dedicated computer with a software program is a much greater risk.

WANT MORE INFO? Click here for more information on online security including specifics on what to look for in a provider.

Get Only What You Need

Another beneficial trend for small business owners: targeted apps for specific needs. Most traditional HR software is developed to serve a number of functions, whether or not you need them. This “all-in-one” approach carries a higher price tag, too. Now, HR software services can be provided as individual apps, such as hiring, onboarding or attendance. Instead of purchasing pricey software that includes all of these programs, you can purchase only what you need.

Is Cloud Software Right for Your Business?

Like many small business owners, you wear numerous hats — trainer, mediator, bookkeeper, team leader and HR coordinator. To help you navigate the HR software decision-making process, we developed this HR Software Quiz. In five minutes, you can learn if cloud-based HR software is right for you and your business.

KEY TAKEAWAYS:
  • Instead of purchasing software at a store, cloud-based software allows you to purchase and access computing capability through a website.
  • Cloud-based software gives you access from any computer, anywhere.
  • You never have to worry about updating cloud-based software. The software company consistently provides updates behind the scenes so you always access the latest version.
  • With cloud-based software, once you enter data into the system, that data is stored securely on remote servers managed by the software provider.
  • An upcoming trend is targeted apps developed to meet very specific needs. This allows employers to get exactly what they want without paying for functionality they won’t use.
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