Benefit Solutions & “The Cloud” - Expert Advice on Risk Framework
But as the landscape continues to shift towards SaaS (Software as a Service) dependency, moving to “The Cloud” is becoming increasingly inevitable.
Luckily, BusinesSolver recently partnered up with Employee Benefits News & Employee Benefits Advisor to help answer that question. They assembled a brilliant panel of well-seasoned Benefits Administration and HR executives to give us their much-needed insight on what is takes to create this new, cloud-based risk framework.
Their just-under-an-hour webinar is well worth listening to (there are also great slides).
But meanwhile, here are our takeaways in 3 parts. Below is Part 1, which explains how the game is changing and why HR teams are ditching traditional ERP in favor of outsourcing. Stay tuned for Part II and Part III.
Ready or Not, Cloud, Here We Come
Traditional Employee Resource Planning (ERP) systems, is software that your company owns and operates “on-prem” (on your physical property). ERP has long been considered 'standard,' but as Benefits Administration and HR technology changes, it’s increasingly losing traction.
This 'hosted option' is the infamous SaaS (Software as a Service). Think of SaaS as anything you run but don’t actually install on your computer (you don’t have physical access to it). These SaaS providers use virtual data storage commonly known as 'The Cloud.'
So Why the Move to SaaS & The Cloud?
What's inspiring this crossover? Kaiser described 2 typical scenarios that incite companies to try SaaS:
#1 Need for Versatile type of infrastructure.
An average sized company needs an average sized “pipe” to handle their employee benefits needs (life events changes, new hires, etc.) But then the “crush of open-enrollment comes.” And instantly, "the size of the pipe needed to carry those transactions is suddenly bigger.”
That company has two options:
Not surprisingly, more and more Benefit Solutions providers are choosing SaaS for that additional flexibility, and shifting their application maintenance and security to a third party administrator (TPA).
#2 Need to Get Back to “Core Business.”
The second case Kaiser described is when HR & IT teams get pressure from higher-ups to “free up internal resources so we can get back to the core business.” Meaning: delegate the “non-value-add tasks.”
That's why one of SaaS biggest value proposition is less administration. Similar to renting a home, bug fixes and updates are the responsibility of the owner (provider).
“We walk into a lot of shops where the first thing they talk about is how out of date their ERP system is, how many updates they are behind. How the cost of keeping up is insurmountable to them,” says Kaiser.
The big downside is having to delegate a critical responsibility to someone else.
And because SaaS has such a low barrier to entry, it’s absolutely essential that you evaluate vendors effectively and make investing in those partnerships a top priority.
*Image Credits: Anna Spady (via Canva)