Strategic Impact of Cloud Computing on HR Transformation

Abstract

Over the years, cloud computing has become a transformative force in human resource management (HRM), enabling organizations to enhance efficiency, reduce costs, and improve workforce engagement. This study investigates how cloud computing influences HR transformation, focusing on the adoption of cloud HR, its drivers and challenges, and its long-term effects on HR efficiency, employee satisfaction, and decision-making. Data was collected from 200 HR professionals across various industries through a survey, which was analyzed using SPSS. The findings reveal that cloud HR functions such as payroll automation, talent acquisition, HR analytics, and employee engagement are widely adopted. Regression analysis confirms that HR analytics, cost reduction, and payroll automation are key predictors of cloud HR adoption and its strategic value in optimizing HR processes. However, challenges like data security, implementation costs, system integration, and employee resistance were identified. ANOVA and t-tests show that organizations using cloud HR for three or more years’ experience significant improvements in HR efficiency, employee satisfaction, and cost savings. Larger organizations benefit more from financial efficiencies. This study contributes to HR digital transformation literature and offers insights for HR leaders and policymakers. Future research should explore the intersection of cloud HR with emerging technologies like AI and blockchain.