Natasha Serafimovska
Career Coach, Professional Resume Writer, Freelance Writer
It’s safe to say that the last two years have brought fundamental changes to the way we work and do business. Companies have relied on technology in the workplace to digitize their services and build a remote-friendly infrastructure that could prepare them for the future.
HR, in particular, has been put under the spotlight with the rise of remote work and people’s need for better, more fulfilling work. Now HR professionals don’t just have to attract the best talent. They also have to prepare the workforce for whatever challenges lay ahead. From measuring employee performance, identifying any skills gap and offering adequate training, HR plays a key role in helping companies overcome challenges and grow as a business.
In this context, artificial intelligence (AI) has emerged as a solution that can help HR teams. AI shows its ability to streamline operations and improve outcomes, while aligning their work with the overall strategy of the business. While this technology in the workplace is still in its nascent phase, its application has the power to transform the overall value HR brings to their organization.
Still, digitizing your HR department is not a small task, especially if you’re just starting the process of digital transformation. Digitizing any function requires in-depth understanding of how those changes will affect other parts of the business, your employees and, ultimately, your customers. Here we look at how artificial intelligence is changing HR. We will also talk about some of its applications and limitations you need to be aware of.
Benefits of Artificial Intelligence (AI) in HR
First, let’s look at what artificial intelligence actually means. IBM Cloud Education defines AI as leveraging
computers and machines to mimic the problem-solving and decision-making capabilities of the human mind.”
IBM
When used correctly, AI can help HR departments streamline a lot of the processes related to hiring and managing employees. There are also opportunities to gain key insights on employee engagement, performance and workforce development.
L’Oreal, for instance, used AI to improve their recruitment efforts by implementing a SeedLink algorithm. This used computational linguistics to both manage candidate’s expectations from the company and recognize their potential during the hiring process. The results were nothing short of staggering. The company noticed a ten-fold increase in the speed of hiring candidates. Additionally, the job offer ratio for interviewed candidates grew to 82% and their retention improved by 25%.
That said, the application of AI technology in the workplace is still limited:
- In 2022, researchers expect that 30% of organizations will implement AI solutions in their HR function;
- Its biggest application at the moment, at 41%, is in recruitment and identifying the best-fit candidates based on publicly available information;
- Only 34% of those who’ve implemented AI, use it for performance management, onboarding or training;
How Is Artificial Intelligence Changing the Recruiting Process?
Talent is by far the biggest expense for any business, so getting and retaining the right people is key. Still, recruitment is a lengthy, paper-heavy process. Hiring managers sift through piles of resumes and cover letters and launch labor-intensive assessments.
AI is disrupting this space by using historical data and relevant keywords to put only the best candidates forward. Here are the three major applications of AI in recruitment:
- Application Tracking System (ATS): seventy five percent of recruiters and talent managers say they use application tracking system (ATS) in the hiring process. 94% say the tools have had a positive impact on their work. ATSs help hiring managers by scanning a candidate’s profile for key skills and experience. This saves recruiters a significant amount of time in the process.
- Job Ad Text Analyzers – the quality of the talent you attract depends on the quality of the job ads you post. AI can scan job ads for exclusionary language and suggest more inclusive alternatives instead. Johnson & Johnson, for example, reported additional 90,000 female applicants (a 9% increase) after using Textio, a writing-enhancement service, for creating inclusive job ads.
- Candidate Assessments – businesses are already using AI to gamify the screening process and assess candidates across several parameters. This includes their risk-taking capabilities, learning agility and different aptitudes relevant for the job.
AI in Performance Management
Traditionally, performance management has been fraught with bias and inefficiencies. Why? Because both managers and employees often rely on their memory and inconsistent data to perform annual reviews and appraisals.
AI changes this. It removes the bias and inconsistency in data-tracking and helps maintain continuity in the assessment process throughout the year. In this context, the true benefit of AI in performance management is seen once there’s a sufficient amount of historical data. AI, then, uses this data to analyze past behavior and offer models of how an employee will perform in the future. An advanced tool can also offer suggestions on what skills a specific employee needs to work on or what behaviors they need to change in order to reach a certain level.
Still, AI in appraisals needs to be used with caution. A study has found that Gen Z employees, for instance, dislike the use of AI and big data in their appraisals and prefer more personal, relationship-based interactions. There are also concerns regarding data security which employers need to consider when capturing and using it in performance reviews.
AI In Workforce Development
The need for skills development is accelerating as new technologies emerge on the market. As a result, the very nature of jobs are evolving along the way. In fact, 82% of jobs had one third of their required skills disappear between 2016-2019. Members of the World Economic Forum estimate that by 2025, 44% of the skills employees have would need to change.
This puts a lot of pressure on HR and talent managers to properly assess the existing skillset. They must anticipate future business needs and offer adequate training to bridge the gap. For example, Pluralsight, a tech workforce development company, already uses AI and machine learning to deliver adaptive assessments. From there, they offer personalized skill-specific and job-specific training. This shaves off a lot of unnecessary time spent in traditional assessments and delivers a more targeted learning program for each employee.
AI doesn’t just help assess existing job-related competencies. It also uses digital badges, internal assessment scores, and past performance markers to give employers a well-rounded picture of their employee’s overall skillset.
A Word of Caution
There’s no doubt that using AI technology in the workplace has had a positive impact on business performance. Starting from task automation and data analysis, AI has removed a lot of the repetitive, transactional tasks. That way, both HR managers and employees can focus on more quality work.
However, the value of AI can be as good as the data you feed it. Anyone using AI runs the risk of perpetuating existing biases if the technology isn’t properly implemented. Amazon is a good example of this. The e-commerce giant has shared a cautionary example when their AI-based recruitment tool turned out to be biased against women due to the use of male-dominant historical data.
The Bottom Line
Technology has permeated every aspect of our life and its use is only expected to grow. As the rate of innovation accelerates and industries evolve, HR professionals need to come up with better and more efficient ways to attract, retain and upskill its talent.
AI technology in the workplace, provided it’s used with caution, can be a powerful tool that HR departments can harness to streamline their processes and gain key insights about their workforce and the business at large.
HR Opportunities
As technology infiltrates the workplace, upskilling remains an important aspect of staying relevant. If you become familiar with artificial intelligence and how it affects your role in the industry, you’ll have access to a broader range of opportunities. This means more job titles, as well as bigger companies. So as you develop those skills, here are a few companies to keep an eye on for internship, entry-level, and management- level opportunities.
