On-Premise Or Cloud HR Technology

How to build an adaptable, open HR technology

As the events of the last two years have shown us, adaptability is key for organizations in all sectors. When things change, as they inevitably do, you need control over how you differentiate, integrate and pivot in response to market change. A big part of this revolves around whether your HR systems live on-premise or in the cloud.

HR systems are vital for managing and monitoring the people in your organization. External and internal factors impacting your organization will also directly affect your people, meaning you need maximum control over the systems you use every single day to keep your people productive, engaged and performing at a high level.

Hosting can be an intimidating topic, and it’s tempting to continue with the status quo regardless of the impact on your organization. However, for HR teams looking to adapt to the times, there is a growing need to find out whether or not your current approach is giving you the flexibility you need to keep up in the ever-changing world of work.

For most organizations, there are two key considerations when it comes to hosting an HR ecosystem:
 

Each approach has its benefits and drawbacks, so the way you choose to host your HR ecosystem depends on the needs of your organization, your resources, your budget, your technical expertise and your available time.

If you don’t want the hassle of hosting your HR systems in-house, you’ll want to go for an ecosystem hosted in the cloud by a third-party vendor. This option means you’ll have access to specialist site admins and developers who can tackle any issues and minimize downtime, and you will have provision for out-of-hours and emergency support. This is ideal for organizations delivering learning and HR services to a global audience, as employees worldwide won’t be left without services for hours if something goes wrong.

Additionally, opting for managed cloud hosting makes it easy to upscale as user numbers increase. In our unpredictable world, this is vital. If you were to merge with another company tomorrow, managed cloud hosting means you can upscale seamlessly without having to manage the process yourself. Your hosting partner will also support you with software upgrades, security patches and infrastructure updates, keeping your people’s data safe and your HR systems running smoothly.

However, bear in mind that managed cloud hosting comes at a cost - you will be paying an external team to manage your learning management system (LMS), performance management system, payroll system and more. Integrations with other systems may also come at an additional cost, and direct control of your site will be handed over to your hosting provider.

If you need exclusive control of your HR system hosting, an on-premise solution is the way to go. For instance, if you have extremely sensitive data stored on your systems and a robust internal hosting team, this may be your preferred approach.

On-premise hosting also removes the external costs associated with managed hosting, meaning you can redirect this budget into creating new learning content and improving the HR systems themselves. Also, you won’t need to pay an external hosting provider to manage any integrations. So if you have an especially complex HR ecosystem, it could save you a significant amount of money by hosting and managing it yourself.

The main barriers to on-premise hosting are the capabilities and capacity of your in-house IT team and the complexity of your HR ecosystem. Hosting issues can escalate quickly, and without the right expertise on hand you could face lengthy periods of downtime, while the problem is identified and solved. It’s also not, as you might think, completely free, as you will need to purchase the server and pay for ongoing maintenance, as well as the internal cost of software maintenance and applying updates.

St Helens Council made the switch from on-premise to managed hosting for their LMS, helping them remove the burden of hosting in-house so they could focus on creating powerful content for their employees while also maintaining over 99.9% platform uptime. 

Retailer Halfords opted for managed hosting as part of a three-stage plan with their new learning technology partner. Along with managed hosting, Halfords’ partner also took over the project management and support of their LMS to maximize return on investment without too much admin work for Halfords. The improvements in hosting stability led to a 20% increase in employees using the site, which in turn boosted employee engagement and learning outcomes.

New Zealand Customs opted for on-premise hosting to maximize their control over their site. They worked with a partner to help them implement their on-premise solution with single sign-on integration, and to migrate legacy HR records into their new LMS. The ability to manage their LMS in-house brought with it the freedom to customize the solution to their exact needs by giving employees the opportunity to manage their own learning and development.

Similarly, Child Care Resource Center chose to self-host their LMS. As a non-profit organization, they don’t have a large HR budget, so they needed a way to deliver learning for in-office and remote employees at the lowest possible cost. In the future, they may expand their learning content to an external audience, which would significantly increase their hosting needs. 

An HR ecosystem is an integral part of any organization’s overall IT infrastructure. HR teams will need to work closely with their IT team to make the right decision. In general, the larger and more experienced your IT team, the easier it will be to self-host, whereas smaller organizations will likely prefer the simplicity of managed hosting.

Whichever you choose, the most important factor is choosing adaptable, open HR technology to maximize your flexibility. Going forward, the vast majority of organizations will be digitally-led, so having control over how you differentiate, integrate and move in response to market change is a strategic imperative.