The Rush to the Cloud Is Putting HR In Charge of its Tech

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Mar 9, 2017
This article is part of a series called Editor's Pick.

It’s a good time to be in the HR technology industry. Last year over $1.96 billion was invested in HR tech startups across 13 categories, including recruitment, career development and automation. There’s also a dizzying number of mergers & acquisitions taking place, with analytics poised as the next big category.

But for the average HR professional, the current landscape is a minefield in trying to navigate the best possible tools and techniques for the business. So how can HR team stay on top of this massive boom in technology, to identify not only what’s relevant to the operation, but also what will deliver the greatest returns?

In the past, HR solutions were more monolithic with a handful of marquee players. However, this monopoly has eroded as smaller vendors have emerged filling niches in the ecosystem, acting as gap-fillers for those bigger systems.

HR becoming technically savvy

This shift means that HR leaders must now be the catalysts for technical change, recognizing what innovations are out there to support their organization. This is underscored by the fact that the relationship between HR and technology teams has changed. Previously, the HR team would approach the IT department to outline the problem, and IT would spearhead the process, typically referring to an analyst report to find out what the market leaders were doing.

Once IT decided on a system, it worked with HR to make sure it met their needs. Today this relationship is inverted, with HR able to take matters into its own hands. The IT group is now only brought into the evaluation process to make sure the new system or systems integrate with the broader corporate infrastructure.

Ironically, HR’s role as a technology catalyst means doing a lot of the work previously performed by the IT department. To be positioned and viewed as having a strategic role within the organization, savvy HR teams are reading industry reports and staying abreast of what rival companies are doing via social media and professional sites like

The move to the cloud

The advantage that the shift from IT to HR has created is that the majority of the niche applications that a business requires are cloud-based. This means it’s possible to trial, and even implement innovative new software with little of the opportunity cost that would have come from trying to rip-and-replace a monolithic, on-premises system in the past.

It also requires HR teams to become adept in participating in a cycle of constant learning. It’s not enough to be an expert user in any one system anymore – the cloud means those systems, even the most proprietary, are iterating at an increasing pace, bringing new features to the product on a weekly, or even daily basis.

With the emergence of more automated and sophisticated algorithms and applications — think analytics, machine learning and AI — the HR leader needs to think long-term. How will these new innovations be effectively integrated into the organization, deliver tangible value, and drive a competitive advantage?

In the next few years, these technologies will undoubtedly upend the traditional HR function even more dramatically. Imagine no longer needing to sit down with every new employee about the onboarding process, but have the system recognize the process he or she needs to undertake based on job title and responsibilities. Additionally, consider the far-reaching benefits that such innovations can bring to not only automatically remind people to complete their performance reviews, but also suggest specific goals to set in line with the organization’s objectives.

The benefits of the cloud and the availability of machine learning and sophisticated analytics means users can become experts in a relatively short time period.

When people are faced with assessing a flurry of functionalities with a limited number of working hours, it’s forcing HR operatives to think more about what data exist to reduce support costs, and increase the likelihood that the software will be used as intended by everyone in the organization. The emergence of AI will not only help HR professionals automate existing tasks — it will empower them to be more strategic players within the business as well.

This article is part of a series called Editor's Pick.
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