By now, we all understand that AI is integrated into our lives and is here to stay. Most of us use some sort of AI daily in our personal and professional lives, whether it’s asking Alexa to set a timer, scrolling recommendations on Netflix or using ChatGPT to help us write our performance review.
For those of us employed in HR, implementing AI tools can support our work by streamlining the administrative aspects of processes such as recruitment, payroll and benefits, providing data-driven insights that we can use for workforce planning, training and retention, and creating drafts for policy documents, templates and personalised communications. And that’s just today. Who knows what the future holds when it comes to AI in HR? In this article, we’re doing a deep dive into how HR uses AI, the benefits, and what might happen in the future.
Don’t forget to download our eBook for an in-depth guide to how HR is transforming from AI.
Table of Contents
What is AI?
AI stands for artificial intelligence. It refers to technology that performs tasks that typically require human intelligence, such as learning, problem-solving, decision-making, responding to language and interpreting images and other sources of information.
Examples of AI include:
- Virtual assistants such as Siri and Alexa
- Language translation applications such as Google translate
- Email host filtering spam and blocking unwanted emails
- Systems that make recommendations, such as those on Amazon and Netflix
Types of AI
When discussing capability, there are three different types of AI that people refer to:
- Narrow AI, also known as Weak AI, includes systems designed for a specific task, so its capabilities are limited to that area. An example of Narrow AI would be recommendation engines or spam filters.
- In comparison, General AI (or AGI) is known as Strong AI because it has human-like intelligence that solves problems without training.
- People also talk about Super AI or Artificial Superintelligence (ASI). ASI does not yet exist but refers to the theoretical position where AI surpasses human intelligence across several areas.
The following specific types of AI support the work of HR teams:
- Conversational AI – natural language processing (NLP) powers chatbots and virtual assistants who provide instant support to employees and candidates.
- Voice technology – synthetic human-like speech generated by AI can respond to employee requests, read policy documents or books for those who need support and provide voice-overs for training and development content.
- Generative AI – large datasets of tools such as ChatGPT and Copilot that can create job descriptions and learning materials and conduct personalised outreach during recruitment drives.
- Machine learning – learns from existing data to identify trends and predict the workforce, for example, whether candidates are a good fit and if someone is likely to leave.
- Automation AI – outsources complex administrative tasks that traditional automation technology cannot fulfil, such as screening CVs for specific keywords and comparing candidates against particular criteria.
How can AI be used in HR?
AI can be used in HR in a variety of ways through the life cycle of an employee. We will focus on the following areas: recruitment, onboarding & offboarding, employee satisfaction & retention, learning & development, performance management, payroll & benefits, and compliance. Let’s dive into it!
Additional resources: Download this free AI eBook for an in-depth guide. It outlines how to leverage artificial intelligence at your workplace and kick starts you to start boosting efficiency in your organization with AI.
Recruitment
- Automatic screening CVs and removal of information that may lead to bias in decision-making (e.g. name, gender, age).
- Chatbots to answer queries from candidates.
- Analyse aspects of body language and vocabulary in video interviews.
Onboarding & Offboarding
- Chatbots answer employees’ questions.
- Automatic assistants guide recruits through the necessary paperwork and training requirements.
- Machine learning can suggest the best training and development programmes based on the employee’s needs.
Employee Satisfaction & Retention
- Machine learning can analyse feedback, absenteeism rates and employee productivity to understand trends in employee engagement and predict issues in retention.
- Chatbots provide immediate 24/7 support on HR policies, benefits and management queries.
Learning & Development
- Generative AI can personalise career development plans based on skills and career goals, making them more attractive to employees and increasing retention rates.
- Voice technology creates artificial coaches or trainers to provide training.
- Machine learning can help identify skills gaps within the workforce.
Performance Management
- Tracks performance and suggests feedback where appropriate.
- Facilities 360-degree feedback by automating the collection of insights from peers, managers and self-assessments.
- Data-driven analysis of productivity measures reduces manager bias.
Payroll & Benefits
- Automation supports accurate and timely payments.
- Machine learning can detect anomalies in payroll data.
- Generative AI can create personalised benefit plans for individual employees.
Compliance
- Automation can track changes to laws and ensure necessary changes to working practices are flagged.
- Machine learning detects language that may be discriminatory.
- Chatbots can provide real-time feedback on questions about compliance.
Related: See how these HR managers use AI to streamline their daily tasks and boost efficiency. *Spoiler* AI is a game-changer throughout their recruitment period.
The Benefits of AI in HR
It’s no exaggeration to say that implementing AI has significantly changed how the HR function works in many businesses. There are several ways that AI creates efficiencies in HR departments and enables a more strategic way of thinking about human resources.
- Using Automation AI means that intuitive and intelligent tools perform repetitive tasks, saving time without losing the personal touch that can elevate HR work to the next level. This work includes screening CVs, responding to common employee queries and scheduling interviews.
- Using automation tools for repetitive tasks also reduces the chance of human errors entering HR systems.
- Linked to this, using AI can help to eliminate bias in decision-making. The tools can remove names and personal details from applications and standardise the assessment and interview process so the focus is on skill-based hiring.
- Machine learning tools can analyse employee data to detect morale trends and allow HR teams to address issues early.
- Generative AI tools can help HR teams quickly create personalised learning and development programmes.
- AI tools can support HR teams by using the data available to track employee performance over different periods and understand skills gaps and issues in succession and talent pipelines so that there is a more detailed understanding of the workforce.
- The different AI tools can also help to identify patterns and flag anomalies, which can help ensure better compliance with employment law and company policies.
- Using AI tools can support high-quality remote and hybrid work by keeping track of productivity and engagement in teams wherever they are based.
- There may be cost-savings in terms of automated tasks, insights that improve spending on recruitment, retention and training, and in needing smaller HR teams.
Example of AI usage in HR
A great example of how HR companies are using AI is here at Factorial. We used AI to support HR teams in a variety of ways, including automating CV screening and candidate matching in recruitment, creating customised reports and summarising polices or documents to highlight the relevant details so HR teams can make informed, data-drive decisions. Read more about how AI is transforming how HR teams are working with our free ebook.
Future AI trends in HR
AI technology is developing so fast that it’s hard to accurately predict what the future will hold when it comes to AI in HR. However, we will likely see:
- Even greater personalisation and customisation of the employee experience using AI tools, including real-time performance data used to influence development plans, mental health and well-being support provided via personalised check-ins and real-time feedback used instead of annual performance reviews.
- A more emotional AI which can detect and understand sentiments and respond accordingly, for example, generating a mental health check-in when it detects low mood or burnout in an employee.
- Increasing use of VR simulations to create immersive environments for onboarding, training and company communications.
- An even greater focus is ensuring that AI tools are used ethically and do not cause harm to individuals or the environment.
