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What is a SAAS HR System?

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A SaaS HR system is a cloud-based solution that offers companies online access to employee management functions. You may have heard of the term ‘SaaS’ at some point in the last few years – and you’ve perhaps thought, what is a SaaS system? And, why use a SaaS HR system?  

The term SaaS (Software as a Service) was coined back in the 90s, but the past fifteen years have seen significant developments in software, so use of the term is more widespread.  

SaaS applications are becoming increasingly popular among SMBs due to their flexibility and affordability, but how much do you know about SaaS software, and in particular, SaaS HR systems? Here at PeopleHR, we regularly have to explain the meaning behind jargon-filled terminology, and ‘SaaS’ just happens to be one of them.  

So, in this article, we’ll present a high-level definition and explore why you should consider using a SaaS HR system. 

What is SAAS?

SaaS is a cloud-based delivery model, whereby a provider develops and maintains cloud application software, provides automatic software updates, and makes software available to its customers via the internet on a pay-per-use basis. 

The SaaS software market is diverse. SaaS products are divided into groups based on the sector or industry they improve, such as online banking or communication.  

SaaS software categories: 

  • Customer Relationship Management (CRM) software 
  • Enterprise Resource Planning (ERP) software 
  • Accounting software 
  • Project management software 
  • CMS and e-commerce platforms 
  • Communication platforms 
  • HR/HRM solutions 
  • Payment gateways and billing solutions 

You may have heard of the likes of Salesforce, Microsoft Office 365 and Google Workspace. All are examples of SaaS. As Access PeopleHR is a cloud-based HR system, then it too is classed as SaaS.  

Why use a SAAS HR system?

There are many reasons why an SMB might want to use a SAAS HR system. Online human resource management is a powerful tool that can help small and mid-size businesses manage their employees more efficiently. In doing so, those responsible for HR can eliminate repetitive and error-prone manual tasks (like managing multiple spreadsheets), making workloads manageable, streamlined and efficient. 

The most effective HR SaaS solutions provide numerous tools and applications that help you oversee and manage the entire HR process. Core HR tasks that would have previously been handled by you (like employee verifications, updating records, benefits admin, for example) can now be effectively delivered via self-service in a cloud computing environment.  

Top-tier cloud-based HR systems can be customised, giving you plenty of options for making design or function changes – specific to your company. Let’s say you want to be reminded when a staff member’s birthday is coming up, workflow management software can allow you to do this with ease.  

Finally, HR software for SMBs can be a cost-effective solution – charged on a price per user, per month basis with little to no up-front fee. To find out more about the cost of HR software, check out our handy guide.  

What are the benefits of a cloud-based HR system?

Two key benefits of a cloud-based HR system: 

  1. Heightened productivity for both manager and employee 
  2. A saving in time, allowing you to focus more on strategic initiatives, rather than administrative tasks 

Automation of HR processes can relieve you of time-consuming burdens. You can also implement new features as your business changes and grows, since SaaS HR applications are scalable. For example, if your business hires more employees, you might find the need for a learning management system to help maintain team members' knowledge without involving HR. 

Benefits of a SAAS HR system:

  • Streamlines and automates your processes 
  • No need for regular upgrades and maintenance 
  • Access it anywhere, anytime  
  • A rich data source for all HR metrics 
  • Reduces error risk and maintains compliance 
  • A wide variety of features to help you stay on top of every aspect of HR management  

Although these characteristics can be found in all SaaS products, they differ depending on the targeted clients' preferences and the product's functionality.  

Having answered, what is SaaS and explored its respective benefits, now let’s uncover what businesses should look for when researching HR systems. 

What should a business look for in a SAAS HR system?

If you’re a business administrator or another employee within an SMB, you may want to build a case for the implementation of an could-based HR system. When researching and building your case, you can use the following list to illustrate how the right technology and expertise can yield significant productivity, cost, and employee engagement improvements. 

Top 3 features businesses should look for in a SaaS HR system: 

  1. Employee self-service - Employee self-service (ESS) helps reduce the burden on HR personnel by enabling employees to manage their own accounts. By using ESS, employees can enter, change, or update their own information, without involving you (or whoever’s responsible for HR).

  2. Talent management - A SaaS HR solution should also have features to help facilitate the recruitment process. This will involve applicant tracking system , pre-designed email templates for initial comms, interview scheduling features (that are connected to the company’s email) and an automated option to post jobs, collect CVs and screen applicants for interviews.

  3. Payroll services - One of the most important aspects of HR is payroll. It goes without saying – employees need to be paid on-time and correctly. For small business owners, this area presents one of the biggest challenges, and is often where mistakes are made and compliance issues occur.

    SMBs will opt to outsource their payroll as it’s less complex and more reliable than doing it in house. If your selected HR software has payroll integration, then this is a big thumbs up. Everything will be fed into the same system – for example, time and attendance will ‘communicate’ with payroll, fully ensuring your staff get paid correctly.

Next steps

Hopefully, you’ve come away with the answer to – what is SaaS? When you’re in the market for any type of software, you will occasionally be met with terminology that you’re not familiar with. Hopefully, this article has helped clarify your understanding of SaaS – and in particular – SaaS HR systems.  

Whilst we’re firm advocates of HR software here at Access PeopleHR, we understand that the decision to invest in any SaaS application is not something to be taken lightly – especially in today’s economic climate. And you might not be ready for HR software if you do not have the resources in place to accommodate this change.  

If you are at the stage where you’re researching and shortlisting HR software providers, you may find our recent post on how to compare HR software useful in your decision making.  

And if you’re interested in learning about how Access PeopleHR works, you can arrange a free demo any time. We’re always happy to provide helpful guidance – even if you decide we’re not a good fit for each other.  

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