What's the current state of implementing AI in HR? In this article, we will unravel the real applications, explore the benefits, and weigh potential risks. Let's explore the future of HR powered by AI.
As the HR landscape undergoes a digital transformation, implementing AI is becoming a pivotal strategy for organizations looking to streamline operations, enhance decision-making, and provide more personalized employee experiences.
Indeed, AI is revolutionizing HR by automating tasks. But is this for the better or the worse? Moreover, the looming question remains: could AI potentially replace the entire HR department?
In this article, we delve into the current state of AI in HR and explore its present and future impact on daily operations.
AI in HR statistics
- According to Eightfold AI’s report, HR leaders are already leveraging AI in various HR functions, such as employee management (78%), payroll (77%), recruitment (73%), performance management (72%), and onboarding (69%).
- IDC's Future of Work 2022 research predicts that in 2023, 60% of global 2000 businesses will deploy AI and machine learning tools to support the entire employee life cycle experience. Furthermore, in 2024, 80% of global 2000 organizations are expected to use AI/ML-enabled "managers" for tasks like hiring, firing, and employee training.
- An IBM survey found that a significant 66% of CEOs believe AI can deliver substantial benefits in HR.
- Price Waterhouse Cooper conducted a survey in which 72% of executives expressed their belief that AI will provide significant business advantages.
- SHRM’s AI in HR research reports that 85% of employers using automation or AI in HR claim that it saves time and improves efficiency in HR processes.
- According to ZoomInfo, 50% of HR executives agree that AI can transform HR functions, and 92% of HR leaders plan to harness AI for talent acquisition purposes.
7 most interesting applications of AI in HR
In this section, we will introduce the 7 most exciting roles of AI in HR that are reshaping the HR landscape.
1. Recruiting and hiring
AI helps discover suitable candidates for the job by analyzing resumes and aligning them with job requirements.
This technology significantly streamlines the hiring process, enhancing efficiency and accuracy to unprecedented levels.
2. Onboarding and offboarding
New hires often feel overwhelmed during the onboarding process, given the multitude of paperwork and procedures that need completion.
By applying an AI chatbot, it can guide them through necessary forms, acquaint them with company policies, and even set up their initial training sessions.
Similarly, in terms of offboarding, AI can manage exit surveys, facilitate the return of company property, and handle other offboarding tasks, ensuring a smooth transition for both the departing employee and the organization.
3. Employee engagement
HR teams often encounter difficulty in accurately assessing employee sentiment. However, an AI-driven employee survey tool can automate this task.
Through sentiment analysis, real-time data monitoring, and feedback mechanisms, AI helps HR professionals understand employee sentiments, identify potential issues, and implement proactive measures to enhance engagement and satisfaction.
4. Performance management
AI brings data-driven insights to performance management.
By analyzing performance metrics, AI provides actionable information for HR teams, facilitating accurate evaluations, targeted feedback, and personalized development plans.
This data-driven approach contributes to continuous improvement and employee growth.
5. Talent development and training
According to Research Gate, skill development ranks among the top 3 factors influencing employee motivation and job satisfaction.
It emphasizes the importance of employee training, and AI is revolutionizing talent development.
By analyzing employee skills, preferences, and learning styles, AI can tailor training courses, webinars, or workshops to individual needs.
It ensures personalized learning experiences that align with career goals, fostering a culture of continuous learning and skill development.
6. Workforce planning
In the domain of workforce planning, AI employs predictive analytics to analyze current and future talent needs.
This enables organizations to identify skill gaps, plan for succession, and understand workforce trends, empowering strategic decision-making for sustainable growth.
7. 24/7 HR support
An AI chatbot can serve as a 24/7 HR assistant, enabling employees to receive instant answers about leave policies, benefits, and more.
Moreover, it allows the HR team to redirect their focus towards strategic tasks.
How AI benefits HR departments
AI streamlines and automates routine tasks, from resume parsing to scheduling interviews.
This not only saves time but also allows HR professionals to focus on more strategic and value-driven aspects of their roles.
Enhanced employee experience
By utilizing AI-driven tools, HR departments can personalize employee experiences.
Whether it's onboarding processes, training modules, or support systems, AI ensures employees receive tailored, efficient, and engaging interactions.
According to McKinsey's Global AI Survey, 27% of HR respondents reported that the adoption of AI led to a cost reduction of less than 10 percent.
AI contributes to cost efficiency by automating repetitive tasks, reducing manual errors, and optimizing resource allocation.
This results in significant savings for HR departments, allowing them to allocate resources where they are most needed.
AI provides data-driven insights and eliminates biases and guesswork, empowering HR teams to make informed decisions.
Whether it's talent acquisition, performance management, or workforce planning, AI analyzes vast datasets to offer valuable trends and patterns, facilitating strategic decision-making.
Evaluate risks of AI implementation
Based on Harvard Business School's survey, 88% of HR executives discovered that their tools reject qualified candidates.
When the job descriptions have too many qualifications, the algorithm may reject some qualified job seekers who lack only a few skills from the list.
It shows that AI still has many limitations, and HR professionals must use their intuition and experience to make the right decisions.
Data privacy and cybersecurity
AI implementation involves the utilization of vast datasets, often comprising sensitive employee information. This raises concerns regarding data privacy and cybersecurity.
Mishandling or unauthorized access to this data can lead to severe consequences, including breaches of confidentiality and legal ramifications.
You must establish robust security protocols and encryption measures and comply with data protection regulations to protect sensitive HR information.
AI impacts the HR workforce
Shifting of HR roles
As AI automates specific HR tasks, the need for human intervention decreases.
However, AI cannot replicate human skills such as emotional intelligence, relationship-building, and complex interpersonal interactions.
In the future, HR professionals will be increasingly required to possess advanced skills to address employee issues that AI cannot resolve. This shift emphasizes the human touch in HR's evolving landscape.
Increase performance expectation
The integration of AI elevates performance expectations within HR.
As technology streamlines processes, HR professionals are expected to leverage data insights, strategic thinking, and adaptability to drive organizational success.
The demand for a higher skill set reshapes the landscape, challenging HR professionals to enhance their capabilities.
In conclusion, implementing AI in HR systems represents a fundamental transformation in how organizations manage their human capital.
From automating routine tasks to unlocking deep insights, AI streamlines processes, fostering efficiency and strategic HR practices.
Embracing this technological evolution not only ensures adaptability in the current landscape but positions businesses to thrive in the future of work.
Looking for an HR solution adopting AI, you may want to check out the below video: