Table of Contents
AI (Artificial Intelligence) has been predicted to transform almost all industries, including Human Resources. Some major companies, such as Google and IBM's HR and talent acquisition teams, have begun using AI in their daily workflows to enhance efficiency and productivity and stay on top of the constantly evolving digital landscape.
It has been reported that 76% of HR leaders believe that if they don't adopt HR practices in the next 1-2 years, they will not be as successful as the companies that have already incorporated AI technology.
Employees are the backbone of every company, and AI plays a huge role in enhancing the employee experience. AI has already been used in various aspects of employee management by supporting employees in learning and development and creating personalised upskilling programs based on their unique needs and preferences.
AI tools can also aid in the employee's well-being, with different tools offering valuable insights regarding workload and the overall well-being of employees.
AI significantly impacts HR and can help reshape many aspects of the industry. Incorporating AI into HR practices has various benefits for both companies and employees.
As artificial intelligence is integrated into HR, stakeholders expect it to be used efficiently. With many industries embracing AI for faster and more efficient work, companies must adapt and stay ahead of the competition.
Understanding Artificial Intelligence in human resouce
AI in HR refers to implementing Machine Learning (ML), Natural Language Processing (NLP), and other AI technologies to automate human resources tasks and aid decision-making. It allows for a data-based approach to talent acquisition, employee advancement, and retention that aims to reduce biases and enhance job seekers' and employees' experiences.
AI tools can assist HR teams in diverse areas, including employee records management, payroll processing, recruitment, onboarding, and performance management.
Until recently, human resources was viewed as a purely administrative department. HR analytics (which sprung up ever since the rise of the digital era) introduced a more evidence-based approach to managing people, including a data-driven model instead of intuition-based decision-making.
The data-driven model involved collecting and analyzing HR data like employee turnover rates, absenteeism, and staff demographics to understand patterns and aid essential decision-making in human resources.
However, with the gradual passing of time and the introduction of advanced data analytics and AI tools, the role of HR has evolved. HR departments today use data more strategically to make better decisions, predict future trends, and contribute to organizational performance and growth. Because of this, organizations now acknowledge HR as an effective strategic partner that can help shape business strategy and gain a competitive edge.
Interestingly, 81% of HR leaders are exploring AI to improve organizational efficiency, and 93% use AI tools to reduce organizational costs. One of the top barriers for 37% of HR Managers implementing AI is the lack of integration into the existing systems.
Benefits of AI in enhancing employee experience
There are various benefits that HR teams can achieve from using AI to enhance the employee experience. Some of the significant benefits include:
1. Streamlining recruitment processes
AI algorithms can effectively analyze vast candidate data, enhancing the recruitment process's speed and accuracy. AI can also provide more objective candidate evaluation, which can help reduce unconscious biases and ensure a fair selection process. It removes human error and subjective decision-making, which fosters fairer hiring practices.
AI also has the potential to assess the candidate's workplace behaviors through advanced analysis techniques, which can help to identify the best fit for the organization. AI can also help forecast future workforce needs by analyzing the organizational strategy, market trends, and performance data.
2. Improving onboarding
AI can help automate the daily onboarding tasks and allows HR teams to focus on the strategic side of things. AI can also help create a personalized onboarding experience, as it will be tailored to each employee's individual needs, enhancing their initial engagement and allowing them to integrate seamlessly into the company's culture. By quickly setting up your accounts and offering personalized training programs, AI-driven systems help speed up the recruitment and onboarding process.
3. Enhancing employee engagement
AI tools can continuously track employees' goals and performance and provide prompt feedback. By establishing clear and measurable goals, AI also promotes unbiased performance evaluations.
AI can also analyze performance data to help predict future performance trends, which supports successful planning and talent management. AI-automated performance management can also lead to enhanced productivity and better results.
AI tools and technologies in HR
AI tools and technologies are now incorporated into HR practices for enhanced efficiency, employee engagement, and desirable business outcomes. Some essential AI tools and technologies included in HR include:
1. Chatbots and virtual assistants
AI chatbots are virtual assistants that use artificial intelligence to support and assist employees. These chatbots can answer frequently asked questions, provide insights about the company's policies, and assist with basic HR tasks and inquiries. AI chatbots can help streamline employee support processes, lessen response times, and enhance employee satisfaction.
Virtual Assistants powered by AI can help HR departments with various tasks, like making their jobs more efficient and effective. They can also help automate repetitive HR tasks like onboarding, leaves, and benefits administration.
They can also offer personalized recommendations to employees regarding career development, performance management, and other training opportunities. Virtual assistants can also allow HR specialists to focus on more strategic tasks and enhance employee engagement.
2. Predictive Analytics
Predictive analytics solutions use AI algorithms to examine employee data and observe people with a higher potential for success in their roles. These methods can also predict future success by considering previous performance and career trajectory variables.
By identifying high-potential candidates, companies can focus their development efforts and offer progress in the company. Predictive analytics can aid succession planning by identifying prospective talent within the organization.
Leveraging predictive analytics can lead to better workforce planning. AI can identify patterns and trends by analyzing a vast amount of data, allowing businesses to make smarter decisions regarding hiring and succession planning. Predictive analytics can also identify potential flight risks, allowing HR departments to develop strategies to help retain top talent effectively.
3. Natural language processing (NLP)
HR professionals use NLP techniques to analyze employee and candidate data, emails, resumes, and feedback. NLP algorithms analyze unstructured text data to utilize valuable information, including sentiment analysis, personality traits, and competency.
This can aid HR teams in making hiring and talent retention decisions and improving employee motivation. NLP can also automate HR processes like resume screening, employee feedback analysis, and candidate ranking.
HR professionals can use NLP to scan resumes and find the right candidate for the job. NLP algorithms extract keywords and phrases, match them to the job description, and rank the candidates based on their qualifications.
NLP can also be used for sentiment analysis, which can be used to identify how well the candidates will fit into the company culture. NLP algorithms can also identify biases in job postings and use inclusive language to enhance diversity in the candidate pool.
Real-life case studies and examples of AI in HR
Let's review some real-life examples of how some of the world's top companies have incorporated AI into their HR practices and how this strategy has set them up for success.
1. Unilever's AI-powered Recruitment
Unilever's HR department has replaced conventional hiring with digital interviews and AI-powered online assessments. This unique approach also expands the talent pool by enhancing diversity and inclusivity. It also reduces unconscious biases, which ensures a fair and objective selection process. This has resulted in a more efficient hiring process that aligns with the demands and expectations of the modern talent pool.
2. Hilton's AI-driven employee engagement
Hilton has implemented AI-driven strategies to enhance employee engagement. These strategies aim to improve the employee experience, increase productivity, and reduce turnover rates. By implementing AI, Hilton saw an opportunity to enhance human connection and responsiveness in the application and interview process.
The HR leaders saw the power of AI to reduce the time needed to fill job openings, enhance and improve the candidate experience, and reduce the recruiter's administrative workload. This led to the creation of Ally, a chatbot for inbound candidates, which was found on the Hilton career site.
Hilton also used AI for video interviews and assessments, which yielded a Net Promoter Score of 85 and improved interview hiring rates. Using Ally, the job you're applying for is sent to your phone with a link to complete your Hilton job application in less than one minute, which is quite impressive.
3. IBM's Watson analytics in HR
IBM Watson Orchestrate is an AI-powered tool that allows HR professionals to automate routine HR tasks, analyze data, and make better business decisions. It uses Natural Language Processing (NLP) to draw from prebuilt and custom skills to implement functions specific to human resources processes by integrating with applications that your HR department already relies on.
TA professionals can use Orchestrate to automate time-consuming tasks like candidate sourcing and recruiting, allowing them to focus their time and energy on the more strategic aspects of recruitment. This has enhanced productivity for HR professionals, leading to better hires for exceptional candidates.
Orchestrate also helps automate manual procurement tasks, which saves the team at IBM precious time to plan strategic initiatives and meet the client's needs and requirements. Onboarding needs human attention and a lot of paperwork. IBM's Watson automates this time-consuming process and seamlessly introduces new candidates to the company.
By offloading these tasks to Orchestrate, HR teams can focus on and deliver a more impactful human-centric approach for the company and the employees.
Challenges and ethical considerations
Although there are many benefits that artificial intelligence offers to HR teams, there are still some challenges and ethical considerations that you need to be aware of when incorporating AI in HR practices. Some critical factors to consider include:
1. Data privacy and security
With the increasing need and use of AI in HR practices, especially when handling sensitive employee and candidate data, there have been growing concerns regarding data privacy and cybersecurity. Companies must hold their employees' data sensitively and carefully and comply with data protection regulations like GDPR and CCPA.
Although the use of AI in HR is gaining momentum, many HR leaders have concerns regarding its accuracy. They are also concerned with the guarantee that the sensitive data offered by employees and candidates isn't used for further training of the AI model, ultimately compromising their privacy and security.
HR departments need to implement robust cybersecurity measures, like investing in a Remote access VPN, using reliable antivirus software, and using multi-factor authentication to maintain trust, protect employees' confidential information, and ensure they're protected from potential data breaches.
2. Bias and fairness in AI
One of the most significant drawbacks of using AI is the bias during the hiring process. The US Equal Opportunity Employment Commission announced in May last year that employers using AI tools can be liable for discriminatory hiring practices. HR leaders need to ask specific questions during the software purchasing process and ensure they are aware of any potential biases.
AI algorithms can perpetuate social biases in the data they're trained on. Be careful of potential discriminatory output based on gender, race, age, and other sensitive characteristics.
If the data used to train AI models has biases, then these biases can be perpetuated in the decision-making process. This can lead to discriminatory hiring practices and unequal opportunities for employees from diverse backgrounds.
3. One-size-fits-all solutions
AI-driven HR systems can offer standard solutions for the most common HR department issues. While this can help improve efficiency, it also leads to a lack of individualized support for the employee's personal needs and requirements.
Every employee brings their own strengths, weaknesses, and experiences to the workplace. Only relying on AI to manage employee performance and development can prevent the human touch and connection required to understand and nurture top talent.
The future of AI in HR
The future of HR and its progress are closely tied to artificial intelligence. AI will help transform HR practices, allowing recruitment, talent acquisition, and employee management to become more efficient. HR professionals can now experience streamlined processes and focus on data-driven outputs.
However, it is essential to note that AI will not replace the need for HR professionals. The human perspective and experience play a crucial role in human resources, allowing companies to thrive and grow. That's why companies must strike the right balance between technology and human interaction to reap the benefits.
Conclusion
AI tools and solutions can enhance the employee experience and increase retention. Employees can offload their repetitive admin tasks, streamline workflows, and gain new tech skills.
Using AI to enhance the employee experience aids in the employee's well-being and also helps the organization build a good reputation. AI tools can create personalized training programs and automate manual and repetitive tasks, allowing for a seamless workflow, employee motivation, and productivity.
