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HR needs to accelerate move to the cloud

In 2020, we saw HR organisations accelerate their adoption of cloud technology – they’re ahead of where they were projected to be, partly as a result of having to adapt to the pandemic.

But the pandemic has also caused a shift in how employees and businesses want to work. HR will need to accelerate its move to the cloud and consider what other new technologies could help it navigate these new ways of working.

For example, a recent survey by ISG found that more businesses are turning to software-as-a-service (SaaS) platforms to streamline their human resources workloads. A majority (64%) of companies said they saw a clear return on investment (in areas such as productivity and cost savings) as a result of using HR SaaS, with benefits felt throughout the organisation.

However, just 15% of organisations in the survey said they had been “very successful” in using emerging technologies – such as AI and robotic process automation – to support HR.

HR organisations are becoming increasingly aware of various emerging technologies, but it’s crucial to understand how beneficial these technologies are if the organisation is to overcome barriers to adoption.


Investment priorities for HR

Respondents to the ISG survey identified their highest priorities for HR spend over the next two years. Emerging technologies are not yet seen as top priorities, though interest is climbing. Robotic processing automation was identified as a priority by 36% and 30% would be focusing on AI and cognitive technologies.

The main priority for the organisations surveyed was on improving user experience: 40% of respondents said investing in experience suites is a key focus, while 38% were focusing on analytics and reporting functions, and 37% were looking into HCM SaaS solutions.

Businesses are still in the investigative stage of getting familiar with emerging technologies and understanding the best use cases for HR. To date, areas such as talent acquisition, onboarding and learning have seen some of the best examples of applying AI, RPA and chatbots. A better understanding about how these technologies can support HR priorities – such as an improved employee experience – can accelerate adoption.


How emerging technologies can support HR agility

Looking beyond the pandemic, many workplaces are adopting a more flexible working model. The future of the workplace will be, at least in some part, virtual. Businesses are also more likely to incorporate the gig economy model into their workforce.

Businesses will need to adapt to meet these changes, and they’ll need to remain agile to adjust to future workplace trends rapidly.

Emerging technologies such as AI, RPA, or chatbots can help HR teams create significant efficiencies at scale to existing processes and design flexible and efficient new processes as the need arises. They can help create an improved end-to-end user experience and provide data insight that leads to real-time decision-making.


Overcoming the barriers to adoption

Working with emerging technologies will always have an edge of uncertainty. Some high-profile headlines over the past year regarding unforeseen consequences of the use of AI/cognitive technology adds to the hesitancy. It requires expert talent to work with these technologies, understand the implications of the technology and get the most out of, what can often feel like, a risky investment.

Even if the HR organisation is keen to adopt emerging technology, these projects frequently go on the backburner. The first steps may be to define a roadmap, secure funding for a business case and define a pilot opportunity. 

There needs to be a top-down cultural shift towards embracing the potential of emerging technology. Often this is driven by an HR technology 'Centre of Excellence' (COE) that can play a critical role in driving the roadmap and adoption of emerging technology.

With the right framework in place, emerging technology is not a threat, it’s a real opportunity to move the organisation forward.


Stacey Cadigan is partner at ISG