HR Big Data Continues to Float to the Cloud


PayScale’s 2015 Compensation Best Practices Report indicates that HR technology will become hugely important in the coming years. But, with all this use of technology, how well is the average human resource professional handling an increasing amount of organizational big data?Since PayScale last reported on this topic, many more companies have moved to cloud technology – as a way to create and manage complex compensation programs. We’ve come a long way in just a short period of time, with powerful cloud compensation applications that focus on results-driven campaigns.  

Cloud computing means big AND better business

Based on a 2015 Goldman Sachs report, over the next several years, money invested into managing business data using cloud technology is expected to reach $43 billion by the year 2018. But it’s still just a slice of the $300 billion pie that makes up the entire enterprise information technology market. Typically slow to adopt new technology and to outsource, HR and compensation managers are still learning how cloud technology supports streamlined human capital efforts. There are two clear benefits of this adoption that most compensation managers can get behind: the cost savings and improved quality of services that cloud computing offer.

In Modernizing Compensation Management, a white paper jointly conducted by PayScale and Ventana Research, indicated that,”more than 80 percent of organizations using big data said doing so has helped improve their results.” These areas of improvement include better communication, knowledge sharing, and performance management.

How does cloud computing create better quality and reduced costs?

Cloud computing has opened up the doors to many new ways of seeing business data. At one time, data was locked away in local servers, not used nearly enough, and only accessed during critical audits. Now, data is used on-demand and in multi-layer reports for making strategic business decisions.

CenturyLink, a provider of television, internet and voice services, predicted in their Global IT Trends whitepaper that, “Within five years, companies will have outsourced approximately 70 percent of their infrastructures.” And that, “36 percent of companies see improved quality of service upon outsourcing their IT to a service provider.” Things are certainly moving in this direction for many human resource departments, specifically those that want to compete for the best talent in a global market.

When data is outsourced, it removes the responsibility of managing all the technology, but retains ownership over that data. This is a major factor in the cost savings aspect of shifting data to the cloud. Data that is better managed and utilized by the business helps to spot trends that can support improved business practices that result in a higher quality of service. Both of these factors help companies to become more strategic in the way they use compensation data to recruit, retain, and create a workforce that rises to the top.

Cloud technology success depends on using the right application

Experts believe that to best make use of cloud computing, one must consider how data can be used and selecting the right application for the job. Any company regardless of size, number of employees, or growth strategy can take advantage of cloud data solutions. Data can and should be used to analyze, improve, and conduct business in real-time. Based on a report published by Nucleus Research, “cloud applications deliver 1.7 times more ROI [return on investment] than on-premise ones…because four out of five cloud deployments deliver increasing benefits over time.” Choosing the best cloud compensation application provider and then giving adequate time to get things optimized helps to improve these results.

The fact is, cloud computing is still adapting to the changing needs of the compensation and HR markets. Keep ahead of what’s happening by visiting the PayScale Compensation Today blog frequently, and by downloading the latest 2015 Compensation Best Practices Report. 

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