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Cloud Hosting (SaaS) VS On-Premise Hosting

cloud hosting vs SaaS

Different types of HRMS Models.  

Among other significant choices that directly impact the success of the businesses, it can be challenging to choose the right HRMS system for your company to run not only day-to-day operations smoothly but to effectively address the strategic facets of HR functions. Just like technology integration has redefined many old-school methods of organization and management ways, it has also increased the number of options when it comes to choosing an HR model for your company with ISO-27001 certified models that ensure cyber security and protect privacy, vital for both the employee and the employer.

Cloud and hosted software are the major choices for organizations in this regard. The decision to opt for cloud and hosting is a critical one that needs a thorough understanding of the pros and cons of the resources and constraints that may vary from organization to organization.  

Role of HRMS

Human Resource Management Systems (HRMS) are software applications that assist businesses in managing and organizing their human resource functions, as well as managing costs and streamlining business processes. Be it for a small, mid-size, large enterprise, or multinational organization, the right HR model is crucial to integrate all aspects of core human resource processes for enhanced efficiency.  

Ideally, an effective HRMS offers robust capabilities for the following administrative and talent management functions: 

What is a Cloud-based HRMS?

The Cloud Service Providers market has evolved considerably in the last two decades, More and more organizations that recognize the benefits of computing in the cloud, have adopted a flexible, scalable, and cost-effective way to access and use software and other computing resources. 


Software-as-a-Service (SaaS) HRMS refers to HR management systems that are delivered over the internet and accessed through a web browser, rather than being installed on a company’s own servers. SaaS has been around for a decade and is one of the most well-known types of cloud computing. It has been a widely used and reliable software distribution model for small and medium-sized businesses. 

With today’s rapid expansion of the IT industry, cloud technologies, particularly the SaaS model, have become the most widely used across all business verticals worldwide. According to Statista, revenue in the Software as a Service segment in Asia is expected to reach US$38.88 billion in 2023, with growth in Singapore expected to reach US$ 0.64 billion in 2023 to US$ 0.88 billion by 2027.

Benefits of SaaS HRMS

Some benefits of using a SaaS HRMS include:

  • Easy deployment:

SaaS HRMS can be up and running quickly, without the need for complex installation or configuration.

  • Low upfront cost:

SaaS HRMS typically have a lower upfront cost than on-premises systems, as there is no need to purchase and maintain hardware.

  • Scalability:

SaaS HRMS can easily scale up or down to meet the changing needs of the business.

  • Regular updates:

SaaS HRMS is updated regularly by the provider, ensuring that users always have access to the latest features and functionality.

  • Security:

SaaS HRMS providers generally have strong security measures in place to protect sensitive employee data.

  • Accessibility:

SaaS HRMS can be accessed from any device with an internet connection, making it easy for employees and HR staff to use the system from anywhere. SaaS is usually provided via subscription, with subscribers paying an annual or monthly fee to access the software. Customer relationship management (CRM) systems, enterprise resource planning (ERP) systems, and online office suites are examples of SaaS applications.

What is an On-premise HRMS?

On-premise HRMS (Human Resource Management System) refers to software that is installed and run on a company’s own servers or computers, rather than being delivered over the internet as a service. With on-premise HRMS, the company is responsible for maintaining the hardware and infrastructure needed to run the software, as well as for performing updates and backups.

On-premise HRMS systems typically include a range of tools and features to help organizations manage and track their human resources, including:

 On-premise HRMS systems can be customized to meet the specific needs of an organization, and may be integrated with other business systems, such as payroll and accounting software. However, they require a significant upfront investment in hardware and infrastructure, and the company is responsible for maintaining and updating the software.

With an on-premises HR system, organizations have complete control over the company’s data, making data security less of a concern. An on-premise system also means that maintenance and development are handled by your own staff, giving you complete control over any changes or updates.

What is a Hosting Service HRMS?

Hosted HRMS (Human Resource Management System) refers to software that is delivered as a service over the internet, rather than being installed on a company’s own servers or computers. In Hosting services, organizations purchase software licenses from a vendor, but rather than purchasing all of the hardware and infrastructure, they rent it from the vendor or another third-party provider. It is hosted remotely, and the software is managed and maintained by the service provider, who also handles updates and backups. 

Cloud Computing vs Hosting Service: What would be the most suitable HR solution for your company?

Cloud computing and hosting services are both types of computing services that allow organizations to store, process, and manage data and applications over the internet, rather than on local servers or computers. Each type of service comes with its own set of advantages and disadvantages. To elaborate further, we have highlighted some of the key differences between the two:

  • Ownership:

Cloud computing allows the user to rent access to resources from a cloud service provider, without owning the underlying infrastructure. With hosting, the user typically purchases a perpetual license and has it implemented on their servers.

  • Flexibility:

Cloud computing is more flexible than hosting because users can quickly and easily scale up or down the number of resources they use based on their needs. With perpetual licenses, flexibility can also be improved upon with additional checks and recommendations to help update existing software.

  • Cost: 

Cloud computing can often be more cost-effective than hosting, as the user only pays for the resources they use and does not need to invest in and maintain their own hardware. As for hosting, users are able to reduce such cost as it does not require a monthly maintenance cost apart from their own server software maintenance.

IQ Dynamics Being ISO 27001 Compliance 

IQ Dynamics HRMS Applications are ISO 27001 compliant, which is an international standard that specifies the requirements for an organization’s information security management system (ISMS). It specifies a management framework for ensuring information confidentiality, integrity, and availability, as well as ongoing assessment and improvement of the organization’s information security posture.

The HRMS models of IQ Dynamics have appropriate controls in place to protect sensitive employee data with data encryption, secure servers, strong passwords, and regular security updates are examples of such measures. The model also includes a documented ISMS, which details the policies, and procedures, to manage and protect the data. HRIQ also assesses and evaluates its information security posture on a regular basis, making necessary improvements as and when required.

What are the benefits of ISO 27001 for the HRMS cloud?

Implementing ISO 27001 for an HRMS cloud can provide several benefits, including:

  • Improved security: 

ISO 27001 helps ensure that appropriate controls are in place to protect sensitive employee data in the cloud. This can help reduce the risk of data breaches and other security incidents.

  • Enhanced compliance: 

Many organizations are required to comply with various laws and regulations related to data protection, and implementing ISO 27001 can help ensure compliance with these requirements.

  • Improved efficiency:

By implementing ISO 27001, an HRMS cloud can streamline its information security management processes and focus on continuous improvement.

  • Increased credibility:

Demonstrating compliance with ISO 27001 can help an HRMS cloud build credibility with customers and other stakeholders, as it shows a commitment to data protection and information security.

  • Competitive advantage: 

In a market where data security is a key concern for many organizations, implementing ISO 27001 can give an HRMS cloud a competitive advantage by differentiating it from other providers.

  • Pay-as-you-go model:

Users only pay for the resources they use by the month or hour. This setup differs from the flat rates of traditional hosting.

  • Reliability:

Hardware failures do not cause downtime because sites and applications are hosted on a network of servers. Traffic travels across separate network interfaces, where it is segregated and secured.

  • Security:

Clients should consider a provider with physical/operational, network and system, and application and data security options.

  • Sensitive data:

Enterprises that work with sensitive data may consider separating data at the hardware level, using dedicated servers or other options.

  • Support: 

Cloud hosting providers often offer tools, and some offer specialist services to help manage the cloud-hosted environment.

  • Performance: 

Latency can sometimes be an issue. Organizations should ensure that they have reliable, sturdy Internet connections.


The phrase “to each its own” fits right to conclude the discussion of choosing the right HR model for your company. While Cloud Computing allows companies to save time, money, and hassle, on-premise HRMS is still a better option for businesses that invest more in equipment and extra support.

Where most companies have now transitioned to Cloud Computing, IQ Dynamics continue catering to different companies with different requirements and unique needs. The decision to choose between on-premise and cloud computing HRMS depends on what’s best suited for your business. 

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