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The New HCM : On-Premise or Cloud (Part 2)

Guest post by
Kirti Shridhar Joshi, Principal Consultant, Infosys


Click here to access the part 1 of the blog.

Given below is a comparison drawn between On-Premise and Cloud options for HCM.



SaaS/ Cloud


·    Matured & well developed best practices and greater depth & breadth of functionalities for wider geographies

·      Relatively young.

·      Not all HCM processes integrated or baked into SaaS


·   Flexible to modify, build bolt- ons

·      Restrict customizations/ Less flexible

Total Cost of Ownership

·   Involves large one- time upfront investment to procure licenses, recurring maintenance & support costs in addition to the hardware, infrastructure and IT costs

·      Requires minimal Capex as well as low cost for support & maintenance of systems

IT Administration

·   Complete ownership of the application including cost of maintenance, support and upgrade

·   New product version- result in additional cost due to redesign or retrofitting

·      No additional investments on maintenance, support or upgrade

·      Provide option to pick & choose functionalities

Control over information & processes

·   Allows full control over critical business data

·      Control over the application and business data resides with the SaaS vendor

Ease of Use

·   Rate lower on UI

·   Longer deployment cycles

·      Rate very high on UI

·      Fast deployment timelines


·   For additional capacity building, extra costs need to be incurred for procuring licenses

·      Pay per use allows to channelize spending in response to business requirement/ capacity


·   Delivers integration tools to connect HCM system with third party vendors

·      Integration needs to be done with vendor offered tool & often involves more cost than in-house


·   Only critical Security measures are implemented

·      Proactive & up- to- date Security

Lock in period

·   No lock-in period. Complete ownership with the buyer

·      Longer contractual agreements to reap benefits out of SaaS solution


The Way Ahead:

In order to decide on the Cloud or No Cloud roadmap, every organization will have to probe into their business needs & priorities and for convincing answers to the key questions noted in the above section. Below are some of the key considerations while deciding on the steps ahead:

  • Keep the big picture of your technological investments & goals in mind- your overall business drivers to adopt the new HCM Solution
  • Go for the solution that will help your people to be best at what they do- simple, easy to access, user friendly, generate reports & critical metrics at finger tips and great employee engagement & empowerment functionalities
  • Evaluate the product fitment based on the Size of your Organization- employee population, harmonized processes, data privacy issues, single system of employee record, ease of access/ ESS, global reporting requirements & compliance requirements
  • Requirements and Functionalities prioritization-
      o Outsourcing option- Organization's penchant for tight control over critical functions like Payroll
      o Best of Breed approach- Point solutions may offer more advanced functionalities that meet your organizations needs than those by popular Cloud or traditional On-Premise solutions
      o Product fitment needs may vary for each organization
           Ease of configuration
           Out-of-box vs Customizations
           Ease of integration with external products

Fashion, fad or gibberish? Or the brave new world, the cutting edge of technology? Points to ponder before we take the Pathway to the Cloud(s).


Meet Infosys experts at Oracle OpenWorld 2013, Booth No. 1411, Moscone South

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