A Tussle of the Muscle While Selecting HRMS: On-Cloud vs. On-Premise Setup

by Aarushi Sharma Human Resource Executive

For companies who plan to automate their HRMS for process smoothening, choosing between On-Cloud and On-Premise is a never-ending debate. But you have to weigh both these options and pit them against each other. While integrating your employees’ recruitment, payroll, leave & attendance, performance management, trainings, etc. and bring them all on a single-screen platform, it becomes imperative to be sure of the format the organization will benefit the most from. Automation in HRMS is so important that Robert Bolton, Head of People and Change Center of Excellence, Partner, KPMG in the UK, believes that “One or two years in this digital age might compare to a decade or two in the analog era. You can fall perilously behind before you realize what’s happening”, as mentioned in the Future of the HR Survey 2019. This blog is aimed at helping you to decide which format fits your bill.

Also Read: Time to Move to Cloud-based HRMS! Know Why

On-Cloud Versus On-Premise HRMS Software: To be or not to be

Deployment Speed

Since software deployed on Cloud platform is created and maintained by the vendor, the service support and maintenance is also taken well care of by them and from outside the company premises. The company does not have to hire a new one or train any their employees to simultaneously care for the software integration with their system. Vendors while deploying software on-cloud also provide dedicated backend support to streamline your processes. This makes cloud, cost-effective, quick to implement and easy to operate and give a rich experience to the end user. Deployment speed is however slow in the on-premise setup as it requires costly high-end costly servers; their setting-up along with providing a proper support and maintenance structure.



The adoption rate for on-premise format tends to be lower than the cloud platform as the high level of customization in the on-premise creates a learning gap which the employee force must bridge to achieve work optimization. Workforce training on the customization hence becomes essential. Adoption on Cloud platform is relatively easier and the success rate is considerably higher since the original software is designed keeping best practices in mind.



With a one-time fixed cost, on-premise setup tends to get on the heavier side on the budget whereas Cloud comes with a much lower one-time fixed cost with a recurring subscription fee. For on-premise setups, support and maintenance charges are levied as overhead charges. SHRMpro offers an expert HRMS solution with every feature specifically designed to impress your HR team in streamlining their work while proving to be cost-effective measure to automate your management processes and rid you off your worries offering both on-Cloud and on-premise setups.



Upgrading on-premise setup requires an overwhelming amount of maintenance services for the entire platform. The upgrade of the physical servers might also lead to a process shutdown for the company, ergo slow progress with more consumption of time.


Data security is a unanimous concern of software users across industries. With Human Resource Management System database security is even more important as it entails of sensitive information like financial details for payroll management, company ongoing project status and much more. Many companies prefer to work with on-premise model for the reason of data integrity. You shouldn’t however raise eyebrows at the credibility of Cloud platform; it offers a high level of data security and contingency measures, whereas the in-house solution lets you to deal with the data yourself and the end user is held responsible for the data integrity. The user will have to take all the measures to prevent data loss and security breach since the system will be internally operated. It becomes a matter of choice for the users in the end.


A recent survey led by KPMG had found that companies who had adopted HRMS solutions ended up with modest gains in the workflow improvement and access to information. This is a direct indicator of a progressive company moving forth on the path of great financial success. While there is an increasing demand in the on-Cloud setup due to it agility and constant innovation in the operative ways without having to undergo specialized trainings to operate the system, adoption of HRMS is catching up rapidly with the companies of all pursuits and the trend is here to stay. Verdict is– to have the HRMS solution is the first step towards progress, having to decide the format is however a personal choice although most practioners root for Cloud.


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About Aarushi Sharma Senior     Human Resource Executive

212 connections, 11 recommendations, 640 honor points.
Joined APSense since, June 6th, 2019, From New Delhi, India.

Created on Jul 4th 2019 00:35. Viewed 212 times.


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