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SaaS versus traditional HR installed software

Short for Software as a Service, SaaS is a software delivery method that provides access to software and its functions remotely as a Web-based service. Simply put, it’s an externally hosted application which is made available to its subscribers via the internet. Depending on the supplier you choose SaaS HR software can offer a complete Human Resource Management System which can link directly with payroll providers and internal databases. Alternatively, if you’re looking for a stand-alone system, for example for performance management or recruitment, a SaaS application can be a very effective solution.

So what’s the difference between SaaS and traditional HR software?

There are a number of key differences:

• Payment for a SaaS system is on a pay per usage model – usually a monthly subscription based on the number of employees.  

• Having a SaaS HR system means that you don’t need to purchase the hardware and database software to run the system.

• With a SaaS HR system there is no HR software to install or maintain and you access it completely through a web browser.

• Access to a SaaS HR system is usually available from wherever you have internet access.

• Using SaaS, you don’t have to budget for costly upgrades as SaaS applications are automatically updated. With traditional HR software providers, if the installed software provider decides to improve their system or upgrade its product, the cost of the upgrade is paid by users in the form of new license fees. Over time, those users who elect not to upgrade might find that the services they expected on their system fail to remain available.

• With SaaS systems, there is usually a short minimum term usage contract, typically two or three years, which allows for a switch to another SaaS vendor at the end of the term.

• SaaS applications can be up and running in a fraction of the time required for installed systems. This rapid deployment is feasible because SaaS providers use their own systems to host the software, have the security protocols and architecture already established, and are set up to load, manage and maintain data every day.

• SaaS software has the ability to grow with a company as its needs evolve. It is not at all uncommon for a company to begin an HR relationship with an on-demand provider for HRMS data only, and then to add Talent Management modules such as Compensation Management, Succession Planning, etc. as the company grows.

Software as a Service (SaaS) is fast becoming the standard delivery model for HR software but are On-Demand Systems Secure?

The growth of on-demand, especially in the highly sensitive area of Human Resources could never have been achieved without the highest level of security. Depending on the provider, security is enhanced beyond what might normally be expected. In selecting a provider, you should make sure to ask questions about security of both data and facilities.

Not only should a company ask prospective providers about online and data security, but they should also ask about user access, filters, and controls. Every potential user should ask about the segregation of data from one company to another so that the separation of information meets the company’s standards.