Solving your payroll and HR issues with insights, answers, and action.

  • Startup
  • Payroll/Taxes
  • Human Resources
  • Employee Benefits
  • Business Insurance
  • Compliance
  • Marketing
  • Funding
  • Accounting
  • Management
  • Finance
  • Payment Processing
  • Taxes
  • Overtime
  • Outsourcing
  • Time & Attendance
  • Analytics
  • PEO
  • Outsourcing
  • HCM
  • Hiring
  • Onboarding
  • Recruiting
  • Retirement
  • Group Health
  • Individual Insurance
  • Health Care
  • Employment Law
  • Tax Reform

HCM Means Business in the Cloud


By now you’ve heard about “the cloud” and perhaps your small business utilizes some aspect of its extensive network of software and servers. A metaphor for computing through the internet rather than in-house, the cloud can replace your own servers and software, so you can spend more time on your primary business.

You may be using or considering a cloud-based HCM solution for increased security protections and cost savings. But did you know there are different approaches to those solutions? Below, we outline different strategies for using the cloud and what it could mean for an HCM platform.

Public — To support the product delivered to clients, the HCM provider’s services and infrastructure are provided by another third party, off-site and over the internet.

Pros: They offer a high level of system efficiency.

Cons: They can be cost-prohibitive, moving capital expenditures to operational expense, and may be inflexible in the solutions they provide. Your IT staff needs to understand and be capable of supporting the products/services in the cloud. And there is a potential lack of control over personally identifiable information (PII) and other data subject to regulations.

Private — The resources used to provide the HCM service are deployed on servers and storage owned directly by the HCM company.

Pros: They give the HCM provider more control and security over the sensitive data handled by their products and services, while offering the same model of virtualization as with a public cloud, helping increase productivity and save on hardware and space requirements.

Cons: This may be costlier than a purely public cloud solution.

Hybrid — The HCM provider’s services and infrastructure use a mix of public and private options across multiple providers. Since the HCM provider’s products and services utilize a hybrid cloud, each aspect of their business lives in the most efficient environment possible.

Pros: By spreading things out over a hybrid cloud, the HCM company has flexibility and operates efficiently. It can also selectively protect and regulate sensitive processes and data while being able to scale less sensitive transactions.

Cons: The HCM company will need to be able to integrate and manage identities between public and private cloud components.

When considering a cloud-based HCM solution, your provider should have a strategy built for optimized performance, data security, and advanced capabilities for disaster recovery. Ideally, the company you choose should have implemented preventative measures to ensure that their mission-critical systems stay online, even in the event of an outage caused by external factors, such as inclement weather.

Hosting data privately in-house allows the provider more control, with the ability to also leverage public cloud computing technologies. Measures such as these can help you feel confident in your HCM provider’s infrastructure and the manner in which it is managed.

Paychex Flex®, our integrated, cloud-based HCM platform, offers secure technology and convenient, experienced support to help your business improve productivity, save money, stay aware of relevant regulations, and attract and develop employees.

For more about the cloud and how you can use it to your advantage, talk with one of our experts.


This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
View More in HCMView All Categories