Ask Alto: Will AI be the best HR employee you hire in 2024?

May 27, 2024 Share this article:

Ask Alto

Artificial intelligence has been around for a while and is now in the spotlight. How can human resources departments use it to their advantage? Read our AI terms every leader needs to know piece here to understand some of the terms used in discussions about AI

At IBM, there’s an annual process where people in the company’s consulting business get promoted and paid more (or not). That sounds simple – but the process is run in 170 countries and involves 100,000 people. As the company’s Chief Human Resources Officer Nickle LaMoreaux describes it, this used to be the number one bugbear for human resources (HR) professionals in the company.

Enter artificial intelligence (AI). A digital worker called HiRo now does a lot of the work: “HiRo will pull together all of the information automatically, then send lists to 10,000 different managers, customised in email… This is all happening without human intervention. The manager can… say, ‘I’d like to nominate these two people; this person’s performance isn’t where I’d expect it to be’. HiRo ingests all of that… then, based on criteria we’ve given it, will make compensation recommendations that the managers can accept or adjust, and then send it directly to payroll,” LaMoreaux says. She estimates that this has saved managers over 50,000 hours in the most recent payroll period.

AI isn’t just for promotion processes. It can also streamline the recruitment process. In 2018, cosmetics company L’Oreal created a chatbot called Mya to help people applying for jobs or internships. Given that the company at the time was reportedly receiving over one million applications a year, an automated filtering system made sense. At the time, Niilesh Bhoite, Chief Digital Officer for HR at the company, said that the results of the first 10,000 recruiting conversations showed that Mya had engaged with 92% of candidates efficiently and had achieved a near 100% satisfaction rate.

These real-life examples, with eye-watering numbers, are probably why, according to Gartner, three-quarters of HR leaders believe that if their organisation does not adopt and implement AI solutions, they will be less successful than organisations that do adopt AI. The same Gartner report says 38% of HR leaders have explored or implemented AI solutions to improve efficiency within their organisation.

It’s clear that the impact of artificial intelligence on human resources is huge and that the HR industry is taking this seriously. But where should HR practitioners start? We’ve surveyed the literature and summarised your “need to know”.

How can AI help in human resources work?

The right AI tools can increase efficiency, reduce costs, and enable HR leaders to focus more on strategic initiatives than on administrative tasks. They can provide data-driven insights gleaned by sifting through spreadsheets and other documents, automate repetitive tasks, and identify patterns in employee behaviours.

Specifically, AI can be used in the following areas:

Recruitment and candidate screening, including functions like writing job descriptions and job advertisements or screening resumes from a large number of applications. However, be aware of unconscious bias that can arise in this process.

• Automated systems can be used to find workers with a niche skill set or level of expertise. For example, AI can find candidates by reaching out to them with automated emails sent to job boards or to LinkedIn.

Employee onboarding and training — AI-powered chatbots can guide new employees through the onboarding process, answer questions, provide information and send reminders about key documents.

Offboarding — When an employee leaves, an AI-powered solution can send out an exit survey, email documents about the return of company assets, or send out emails to revoke the employee’s access to various systems. It can also analyse the answers to open-ended exit interview.

Performance management and feedback — AI can analyse data on employee experiences or what the leadership pipeline looks like.

• AI can also identify bottlenecks in worker productivity by keeping tabs on their online movements and can monitor employees’ performance, behaviour and engagement. This data can help HR teams to optimise workflows and identify areas for improvement, although it usually not very popular among staff.

Learning and development — By analysing data on each employee, such as their skills and preferences, AI could tailor training according to personal goals. AI could also help HR managers identify hidden talent or identify employees ready for promotion.

What are the downsides of using AI in human resources?

Outside of the hype about sentient robots taking over the planet, there are some real concerns about using AI. These include:

Potential job displacement or changes in job roles — More repetitive and less complex jobs are vulnerable to automation, with associated job losses that could draw the ire of labour unions and organised labour. Any move in this direction should be accompanied by upskilling and reskilling of affected employees.

Data privacy — Using AI to optimise processes and evaluate performance raises concerns about employee privacy. A data management strategy should govern the collection and analysis of personal data. The strategy must include letting employees know what data is being collected for AI systems and how it is being used.

Cybersecurity — AI is susceptible to hacking algorithms. Malicious code could be introduced into training sets, potentially infecting the company network. Business leaders should work alongside IT and security operation centres to create plans that will keep AI projects secure.

Potential bias in algorithms — AI systems are only as good as the data they are trained on. For example, an early resume screener tool used by Amazon was trained on resumes of mostly male employees (reflecting the hiring skew in the industry). Over time, the tool picked up on male preferences and systematically downgraded people with the word “women” in their resumes. The company discontinued the tool in 2018.

A Harvard Business School survey found that 88% of HR executives learned that their tools reject qualified candidates. For instance, the algorithm rejected applications based on work gaps in candidates’ resumes – which might represent legitimate life events, like pregnancy, military deployment, or illness.

Navigating AI challenges

According to a global study from the IBM Institute for Business Value (IBV), surveyed executives estimate that 40% of their workforce will need to reskill as a result of implementing AI and automation over the next three years. The human resources employees who work with new AI technologies are no exception to this massive reskilling need: they, too, will be required to upskill or reskill. In addition, their future functions will likely include supporting employees in the adoption of AI across the organisation.

Key to all these changes will be underlying attitudes. The Academy to Innovate HR suggests these soft skills are critical:

1. Business acumen: Understanding the business is the starting point for aligning HR solutions with business needs.

2. Active listening: Active listening goes hand in hand with empathy, the ability to see situations from the perspective of all stakeholders – an important skill when managing the complex change management process involved in integrating AI processes across the business.

3. Problem-solving and critical thinking skills: The adoption of AI will inevitably involve curveballs and unintended consequences. HR practitioners (and all executives) will need to employ agile leadership principles to help their organisations navigate these challenges.

4. Curiosity: Any new initiative starts with a growth mindset, which means asking questions and staying open-minded.

A roadmap for the integration AI into human resources

Whether you’re interested in an all-in-one solution (think IBM’s watsonx), or need to assess candidates faster (TestGorilla) or want a view on cultural fit (HireVue), there is a bewildering variety of applications out there. The right solution will depend on defining pain points within the HR department, and identifying the kind of tool that might help. Teamflect, which makes employee engagement and performance management software, suggests these steps:

1. Start small — A pilot programme will allow you to test the technology and identify any issues before rolling it out on a larger scale, and it will also give your team time to get comfortable with the new tools and processes.

2. Focus on ethics — Be transparent about the use of AI tools with employees and candidates and ensure that algorithms are not biased against any particular group.

3. Invest in training and encourage discussion — Implementing AI in HR requires significant investment in training for staff and employees who will interact with the technology. Encourage open discussion when it comes to the use of AI tools in human resources or any other department.

4. Stay human — Don’t let AI tools completely take over human jobs. Instead, use them to make the lives of your employees easier.

5. Continuously evaluate and improve — Collect feedback from employees and candidates, monitor the data, and use this information to make informed decisions about how to improve the use of artificial intelligence in human resources.

The role of top leadership in integrating AI in an organisation

The human resources department might be an obvious contender to start using AI tools, dealing as it does with data and administrative processes. But using AI, wherever it is first adopted, will have knock-on effects throughout an organisation. Top leadership can take charge of the process by thinking transformatively. In the context of AI that means that leaders should be seen to be learning the new skills and tools – but they should also be thinking and talking about the deep changes that these technologies may bring over the next few years.

Crucial areas for leadership to address include the impact of AI on jobs within the company and privacy and ethics. The C-Suite should be involved in establishing an AI policy for the organisation.

It’s also important to be clear about where the responsibility for AI rests. While a chief technology officer provides technical expertise, a chief human resources officer must ensure that AI aligns with HR goals and enhances the employee experience. Collaboration between the two is key to successful AI adoption.

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