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More and more companies are turning to cloud-based solutions for their software needs in order to eliminate the need for hardware such as servers and to reduce the dependency on IT the need for manual installation of updates.

With many cloud solutions, the provider aims to offer a suite of products for process automation and data management. While these providers have come a long way in consolidating multiple enterprise processes into one solution, few provide everything a company needs.

For example, in Human Resources, companies like WorkDay®, SAP Success Factors®, and Oracle® are aiming to automate many HR processes to become complete Human Capital Management (HCM) systems. While record keeping of employee positions, salary and performance are well established in these solutions, strategic performance management and compensation management are still lacking. The same holds true for sales force management solutions such as Salesforce®. 

 

The HCM gap of compensation and performance management

For both Human Resources and Sales, the common gap in today’s cloud solutions is the ability to strategically manage employee compensation and performance. Companies are finding compensation management in HCM solutions to be too restrictive and lacking in strategic features. Additionally, the lack of strategic capabilities in the compensation module of HCM offerings can increase compensation risk as companies aim to ensure transparency, fair pay and regulatory compliance. Often this means that companies are purchasing a separate IT application to fill this gap.

Since most compensation and performance management systems do not connect with HR and sales management systems and sometimes require installation on a physical server, the additional workload to support an additional system and its associated hardware falls on the IT staff… a team which is often highly constrained by a lack of resources.

 

Establishing a fully-connected solution suite

Niche players in the HR and Sales technology industry have been focusing on providing the missing link to close the gap of strategic compensation and performance management. Fully-integrated solutions not only read information from products like WorkDay®, SAP Success Factors®, Oracle® and Saleforce® into their own applications but also provide a two-way connection to write back into these applications, providing a truly consolidated solution suite. Two-way communication is currently rare in strategic compensation solutions, so any company seeking to create a unified HR suite should add this feature to their requirements list.

 

The benefits for IT staff

Combining a strategic compensation suite with the most popular HR and Sales software offerings reduces costs for IT. Since these combined solutions reside in the cloud, no physical servers are required, the software is always up-to-date and requires no IT intervention for upgrades. Additionally, the cloud makes the solution easily scalable as a company grows.

Compensation and performance management solutions that have been built on Azure, a Microsoft offering, are backed by the highest levels of data security to protect your workforce information. Poor software performance that would result from a growing company using a physical server is not an issue for cloud-based solutions. The computing resources needed as a company grows are always available in the cloud.

Cloud-based solutions that are constructed with an open architecture and web API integrate seamlessly into existing HR suites and sales force management technologies. This helps make platforms completely flexible and configurable to match a variety of business processes while requiring little to no IT administrative assistance. At the current time, there are few unified total compensation platforms, so it is important to ask questions about the architecture of a solution before making a purchase. Companies need a system which easily addresses compensation complexity and variance not addressed by HCM suites while minimizing the requirement for IT resources to support the application.

 

No custom workarounds required

For most business processes, purchasing a software solution means that a company’s processes must follow the workflow of processes coded into the software. Historically, this lack of flexibility has meant that IT teams were burdened with creating custom programs as workarounds to hard-coded processes that were incompatible with how a company conducted business. Those seeking a unified HR suite by combining a strategic compensation system with existing HRIS technology should ensure that the purchased solution does not force a company’s compensation strategy into pre-defined modules or templates. A flexible solution will eliminate the need for IT resources to code custom workarounds.

 

Relief for IT and business resources

Human Capital Management systems have provided substantial improvements in recent years in terms of better workforce management and visibility. With most HCMs having moved to the cloud, the burden of IT resources to support these systems has been dramatically reduced. IT no longer needs to support hardware for these applications, conduct software upgrades or worry about exceeding the capacity of current file storage or processor limits. IT will never be tasked with having to code custom workarounds to inflexible processes.

Combining a cloud-based, bi-directional compensation solution with the most popular offerings in HCM suites will simplify IT by providing the missing link that companies require.