Workforce dynamics are increasingly complex and the regulatory environment gets ever more challenging. Relying on outdated IT systems and hoping for the best has become a risky business.

Hence the growing appeal of modern, cloud-based HCM (human capital management) systems. By 2025, three of five mid-to-large organisations globally are expected to have deployed one (Gartner).

Cloud HCM software tackles core HR activities, such as personnel and benefits administration, payroll, and employee self-service. But depending on organisational needs, it’s also possible to deploy modules that support workforce management. This includes workforce planning, time and attendance. It also covers reward and recognition, and compensation and talent management. The latter includes recruitment, onboarding and performance management.

Here are three reasons why it makes sense to invest in cloud HCM software:

1. Cut costs and boost efficiency

Many organisations are coming under increased pressure to prune costs and increase efficiency. Cloud HCM systems can support this goal by streamlining and automating key HR processes. This reduces the costly errors and compliance breaches that all too often result from manually undertaking tasks, such as data entry.

Introducing this kind of software also means fewer HR staff have to undertake routine tasks. That makes it possible to redeploy them on more strategic, higher value activities. And during periods of organisational change, like mergers and acquisitions, HCM applications allow cost-effective scaling user access up and down quickly, as required.

2. Manage increasingly complex workforce needs more effectively

Workforces now are more complex than they have ever been. Some employees prefer to work in the office full-time. Others opt for a hybrid approach, or even fully remote, whether they are based at home or abroad. But many employers also have more temporary, interim, or freelance workers on their books than ever before. This situation often means less predictable staffing patterns.

The advantage of cloud-based HCM systems in this context is that they make it easy to support workers on whichever device they choose, no matter their status or place of work. In-built compliance tools ensure that key functions, such as payroll, conform to evolving regulations, from minimum wage to pensions and employment benefits.

3. Become more data-driven to improve decision-making capabilities

Payroll and HR functions create a wealth of people data. But all too often it is locked in disparate, siloed systems, making it impossible to use effectively.

Cloud HCM systems enable employers to secure and store their people data in one place for an accurate ‘single source of truth’. This makes it easier to analyse and draw out useful insights. Doing so helps to inform leaders’ decision-making and forecasting activities by providing valuable insight into workforce patterns and trends.

Learn more about how Zellis HCM Cloud works.