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How AI Is Changing HR

AI is automating HR’s administrative tasks and, for the first time, giving HR leaders the tools...

John Zappe
Tech researcher and journalist
October 4, 2021
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Artificial intelligence and machine learning are transforming human resources management in subtle and sometimes dramatic ways. With increasing speed, artificial intelligence is becoming a part of HR technology.

The largest employers are leading the way, investing in HR technology and tools to automate time-consuming HR functions, but small organizations are leveraging the power of artificial intelligence in ways they may not even realize.

In This Article

Chatbots and Candidate Selection

Recruiters rely on machine learning-enabled applicant tracking systems to analyze and rank job applicants. Each time a candidate is selected for an interview or is hired, the algorithms incorporate that information and improve the quality of the system’s ranking.

Smart chatbots spare HR departments from endless employee calls about benefits, work schedules, and vacation time updates. Powered by artificial intelligence, these chatbots understand and respond to questions that previously required a human to understand.

These are just two of the most visible ways artificial intelligence is being used in human resources. Indeed, in a survey before the COVID pandemic, three-quarters of HR leaders said artificial intelligence would play an essential role in their industry in the future. In another, earlier survey conducted by Oracle and Future Workplace, 38% of the HR respondents were optimistic about AI, more than any other group.

That’s not a surprise since AI technology automation was already freeing up HR professionals from some of the routine administrative tasks that once consumed so much of their time. Payroll automation was one of the earliest HR functions to be handled by HR technology. Today, AI technology integrates payroll with other HR systems to automate the process of updating individual compensation when their status changes or raises are awarded.

AI chatbots in HR shared service centers or deployed on company intranets not only handle the employee questions that used to require human intelligence, they collect metrics about employee concerns, making for better HR decision making. At the same time, because these bots operate even when HR departments are closed, they lead to higher employee engagement and improve the employee experience.

That extends to talent acquisition where natural language chatbots improve the candidate experience. Interacting with candidates in real time, they answer routine questions, handle the pre-qualification, and can take candidates through completing an application and any required assessments.

These bots can be used in sourcing candidates. The job description and other parameters set by a recruiter, or previous hires for the position, provide the data for the artificial intelligence behind these bots to know what to look for and where. The results are then further analyzed to provide a candidate ranking, just the same way the algorithms do for candidates applying through the career center.

A desktop screen with a collage of AI images

The Future of AI in HR

Automating the workflow and freeing up the HR team from routine and repetitive administrative tasks enables HR professionals to plan and develop HR strategies that lead to better performance management. Algorithms here can’t yet do what human intelligence can. What artificial intelligence and machine learning can do, and where human resources is heading, is to analyze the huge amount of data every HR department collects to detect trends and discern patterns.

More than automation, this is likely to be the most significant way AI is changing how HR works. AI analytics are making it possible to improve retention by predicting which employees are likely flight risks. Algorithms today are analyzing employee engagement surveys to provide an early and quick read on a company’s or a department’s strengths and weaknesses. This makes it possible to develop or shift HR strategy.

Automation of HR processes and workflows is the first wave of artificial intelligence. The second wave is enabling HR departments to become a full partner in their organization by using AI analytics to develop strategies to improve overall talent management.

Artificial intelligence holds so much promise that venture capitalists are pouring billions into HR technology. The first six months of 2021 saw $7.6 billion invested, more than ever before. Nine new HR unicorns were created, all of them with artificial intelligence and machine learning products.

The HR information site PeopleMatters summarized its update on artificial intelligence this way:

“AI can re-imagine the way HR function works. The automation, operational analysis, and predictive analysis provided by AI techniques can definitely help to increase productivity and performance of HR function, and contribute to enhancing its role as a strategic partner in an organization.”

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John Zappe

John is a former newspaper journalist, digital media and tech researcher, and the former editor at ERE Media, a leading information hub for HR and TA professionals. He has over 20 years of experience in developing whitepapers, research reports, and informative articles. John is an alumnus of the Syracuse University College of Law and holds a bachelor's degree in political science from Marist College.

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