Buying HR software as a service changes three things about the relationship: procurement becomes a contract rather than a project, updates arrive whether or not you are ready, and leaving is a data question rather than a decommissioning one. Each has a practical consequence worth planning for.
Updates you cannot defer
Continuous release means the product will change under you, occasionally in ways that affect a process you built around it. Ask how much notice is given, whether there is a preview environment, and whether any change can be deferred. The answer is usually limited, which is an argument for keeping your configuration simple and documented.
Procurement is the contract
There is no installation to get wrong and no server to size, so the diligence moves to the terms: security, sub processors, availability, price increases and data return. Employers used to buying software as a capital project frequently under invest in this part and discover it at the first renewal.
Plan the exit at the start
Know what an export contains, how long you have to take it, and whether it includes historical records rather than current state. Because employee records carry long retention duties, a service you can leave cleanly is materially different from one you cannot, and the difference is a clause you negotiate before signing.
Questions people ask about hr software as a service
Can we stay on an older version?
Almost never in a true subscription service. Keeping configuration simple is the practical mitigation.
What should a security review cover?
Access controls, sub processors, encryption, incident notification and deletion. Ask for the standard pack rather than writing your own questionnaire.
Does the vendor own our data?
No, and the contract should say so explicitly along with what happens to it on termination.