Payroll in the Clouds: Stormy Weather or Silver Lining?

Posted by Vincent Fabello on March 20, 2015

Budgeting Architecture and Engineering Projects

In previous blog posts, HRsmart has touched on the cost savings companies can see by moving to cloud-based talent management software - "Cloud Computing for HR." While payroll services can benefit from the same accessibility and cost savings of cloud-based services, the nature of payroll may make some small and mid-sized business (SMBs) hesitant. Companies and employees these days are acutely aware how valuable their information is to hackers and thieves, and take additional precautions to safeguard their data. So beyond the fear, uncertainty and doubt, where do SMBs and payroll providers stand? What are their concerns and what the facts on the ground?

SMBs and individuals must be constantly vigilant to guard their information these days. Unlike talent management systems, payroll systems contain names, social security number, and detailed financial information. This information is a prime target for identity theft and fraud. Companies have a duty to their employees to keep their data safe. So how many companies use cloud-based payroll? According to HR Technology review company, Software Advice's 2014 HR Software BuyerView report, they found that only 24% of SMBs currently use cloud-based payroll software. 53% of SMBs said they use on-premise software.

Payroll in the Clouds: Stormy Weather or Silver Lining?

So, are cloud-based solutions secure or not? Do SMBs really need to be worried about their data when it comes to these solutions? Due to their nature, many times cloud-based solutions are actually just as secure if not more secure than on-premise solutions. In the same survey from Software Advice, only 36% of companies felt "very confident" in their internal security precautions when using on-premise solutions. IT teams are spread thin no only with internal application support, but also infrastructure, compliance and security of all the services.

Payroll in the Clouds: Stormy Weather or Silver Lining?

Cloud-based providers have the unique advantage of being able to narrow their focus to the security of the services they provide. These providers can focus solely on the security considerations of cloud-based applications and hardening their systems, while SMBs who use on-premise solutions simply don't have the resources or expertise to secure their systems sufficiently.

So in conclusion, cloud-based solutions are really the wave of the future, and the silver lining in data security that we've all been looking for! Security issues are no longer a major concern with these, and they have managed to become even more secure than the traditional on-premise options. Don't be afraid of the future but embrace it, and see where it can take you!