What is the Effect of AI and Automation on HR?
There is a lot of hype around AI and HR, but what does it really mean for HR? How is the use of machine learning and other AI techniques impacting the vendor landscape and what are some of the main trends that HR will need to adopt to succeed in a world of digital transformation?
These were the topics that I discussed when I was invited recently to speak at the &NOW conference in Turkey in May. I have included the full video of my keynote presentation below, as well as some of the key points from my talk in the article beneath it.
The impact of consumer technology on workforce expectations
If we take a look at the world of consumer technology that we're using every day and think about how quickly that has changed, then you’ll see that platforms like LinkedIn, Facebook, YouTube and Twitter came around in very short succession all about 15 years ago and we got used to this idea of putting information out onto the web and using the web to get information back again. Then all of a sudden the iPhone launched in 2007 and the world changed again. We changed from thinking about this in terms of web-based platforms to thinking about the power of the mobile phone and how we could have a computer in our pocket. Then we suddenly discovered this new wave of technology which was app-based and mobile oriented and so suddenly you saw Airbnb, Instagram, Uber, Snapchat and many others explode very quickly onto the scene all in a very short timeframe. 15 years ago, none of these platforms existed. Five years ago most people didn't use half of them, and now billions of people are using them every single day.
So what does all of that mean and where's that leading us? The reality is that AI is now everywhere. Now some of it is not as advanced as sometimes we’re led to believe, and we will see this increase exponentially over time, but there are elements of machine learning, natural language processing and other components of AI that are prolific in our lives every single day. If you use platforms like Netflix or Amazon or listen to music on Spotify then the algorithms behind the scenes are creating a more personalised experience and that's the piece that is really important when we think about the impact of AI on HR. The shift in our experience in our consumer lives is changing the expectations of the workforce in your companies, because every day we are using these types of technologies and then we come to work and have a very different experience. We have the type of experience that we were having 15 years ago in our consumer lives.
Are HR professionals ready for AI?
There was a survey run by HR.com last year and there were three questions that they asked that really stood out:
The first interesting finding from this survey is that 79% of the surveyed respondents agreed that chatbots will be an important interface for employees to real-time answers. That's not really surprising because every day we are using some form of conversational interface whether it is WhatsApp, Slack or another service. We also might use a chatbot or voice assistant such as Alexa, Siri, or Google. Either way we are getting more and more familiar and comfortable with chatbots and conversational interfaces in our consumer lives. However, the second question found that less than half of people felt that they'd be using AI at work in 2023. So immediately you see a drop-off, where people can see AI is coming but they don't necessarily believe it's in the near future at work. Then in the last question, only 14% of people strongly agree that they're knowledgeable in the area of AI, and that's the biggest area that I think as an HR profession we need to tackle. Not only do we need to think about how we upskill our employees and our workforce and help them to deal with the future of work but we also need to think about how to upskill HR and what are the skills that HR needs to be successful in this new world of work. More on that later.
What are the main areas where the HR Technology landscape is changing?
When we look at all of the different types of HR technologies that are out there, and there's now hundreds of them that have some form of machine learning or AI at the core of their platform, and have an HR use case. One of the biggest areas that we're seeing an impact is in recruitment. Over a third of all of the vendors that are out there that are using some form of AI in their platform are doing so to try and disrupt recruitment and there are a few different ways that they’re doing that, these include:
Selection and Assessment
So I’m not talking about employee engagement or engagement surveys when I talk about Employee Experience. What I'm talking about is the experience that people have in your organisation using HR technology.
I don't think there are many employees out there that enjoy the experience of going into a typical HR system that's been around for 10-15 years. Many of the traditional HR systems feel very old-fashioned and what we're starting to see is tools like chatbots to help with this and to disrupt the way that we actually engage with technology, or the way that we get or provide information.
An example of this could be in the recruitment process and form part of the candidate experience, where as a candidate I can get immediate answers to my questions, or I can be guided through the onboarding experience by a chatbot. Or this can relate to some of the typical questions or tasks that employees have to complete at work. It could be getting information about the company pension policy, booking a day’s holiday/time off, or maybe even booking a flight.
The exciting part of using chatbots or conversational interfaces to help with these types of queries, is that we can meet people where they work. Instead of expecting them to log in to an intranet or a self-service interface that they find hard to navigate, we can embed these types of tools into the messaging apps that they’re already using, such as Slack or other similar tools, and people can use those apps to get answers to their questions in the same way that they would message their colleagues.
Learning and Development
When we think about platforms like Netflix and we think about a personalised experience and the millions of personas that they're now creating to really understand everything that you're doing, the different ways that you're clicking on the screen, when you pause, what you watch, what types of shows you like on the weekend versus during the week.. All of that can now be applied to the learning environment at work where we can start to track some of the interactions users are having in the new learning experience platforms and we can start to really understand the types of information that people are trying to consume and how they are consuming them.
We can also start to infer the skills that someone has and the skills that they're looking to grow and we can make sure that we're giving the user a personalised experience in return. These types of advancements in technology are really going to transform the way that people consume learning in the workplace, as will other technologies such as VR (Virtual Reality) where we are already seeing companies using VR for areas such as harassment training or to help train workers by simulating on-the-job activities in dangerous conditions.
People analytics is continuing to gain popularity with technology vendors and we're seeing a lot of maturity coming into this area. We hear a lot about predictive attrition models and that's certainly one way that we're seeing companies start to think about how to use machine learning and to be more predictive with the datasets that they have. However, the other area that I am seeing a lot of progress in is natural language processing (NLP). The tech vendors in this area focus on how to understand all of the text-based data that you have in your organisation, either coming through your engagement survey, through chat panels on your intranet, or wherever discussions might be happening, and then focus on how to understand the themes in that data and how to perform continuous listening across your organisation to surface new insights and take action to improve employee engagement. There are many great examples of companies now using NLP to really understand things that their engagement survey just hadn't told them in the past and by turning on more of a continuous listening program they were able to glean insights that they just hadn't had before.
Then the last trend under people analytics is around organisational network analysis or ONA. Again, this is an area that is definitely growing in the vendor landscape and some of the most common uses cases that people are exploring are to understand the activity that's going on across your organisation by looking at calendar data, email metadata and exploring how individuals are collaborating and interacting with each other. If you’re interested in learning more about how ONA is being used in people analytics, then this great article from David Green is worth reading to learn more.
What is the impact of AI on HR? What are the key trends?
So what does all of this mean and and how is this impacting the HR function? There are three main trends that are surfacing due to the changes in HR technology:
Personalisation - This is a theme that we as HR professionals need to really focus on and use technology to explore. There is a real opportunity to move away from the way that we've delivered HR programs in the past where it's been one size fits all and a lot of the technology that we've pushed out or the programs that we’ve pushed out have not been adopted as well as we might like. We can move beyond that and now create an environment of one size fits one where we create a personalised experience where people are encouraged to use platforms and to provide data just like they do in their consumer lives. It then ultimately means that the system learns about them and helps improve their experience and can personalise the experience in return.
Lifelong learning - Due to all of the disruption we are seeing from automation and advancements in technology, being able to support upskilling and lifelong learning will be critical to the future success of HR. This isn’t just about how HR supports the workforce when it comes to reskilling, but is also about ensuring that employees are constantly thinking about how the changes in technology and the changes in the world of work are affecting their jobs and the skills that they're going to need to be successful in the future. It is critical that organisations build an infrastructure that supports employees in their efforts to learn new skills and upskill to support continuous employability. To read more about the need for HR to support continuous reskilling, you can read this recent blog post on the topic.
User-centric design - There’s a lot of talk about how to apply design thinking to HR and creating a more user-centric approach to HR programs. By putting the user in the centre of our designs around HR platforms and new HR programs, it means that we don't create solutions in a bubble anymore and we don't just implement technology because the IT department thinks it’s a good idea. The goal of user-centric design is to work with our users (employees, candidates, managers etc) to understand what it is they need and then design it with them. It means we can prototype things with pilot groups and iterate as we go based on their feedback, so that when it is time to deploy something enterprise-wide, the adoption is so much higher because people have been involved in the process of designing it. If you’re interested in learning more about this process, then I suggest you read this article on using design thinking in HR.
Upskilling HR to have the skills of the future
So with all of the changes and trends that I’ve listed above, it is critical that we look inwards as a HR function and consider how we too reskill, upskill and adopt the concept of lifelong learning to ensure that we as HR professionals are prepared to support a much more digital and data-driven HR agenda. We ran a survey recently at myHRfuture to determine “what are the HR skills of the future?” that people felt they were most lacking or wanted to develop. You can read more about it by going here or by downloading our HR Skills of the Future report.
Our survey found that there were six skills that were most important to the future of HR, as shown in the image above. You can see the first two in green are around people analytics and strategic workforce planning. This is the need to understand how we can be more data-driven and put data at the heart of our decisions rather than relying on gut feel, and start to think about how we can create more agile organisations. The second column is around HR technology and design thinking. As I've just outlined, there are new skills that HR needs around using design thinking principles to influence how we design and deploy new technologies, and HR needs to become an expert in the HR technology that is available.
Lastly, the third column is on stakeholder management and influencing or consulting skills. None of the technical skills matter if HR professionals are unable to get buy-in from the senior leaders in the organisation or to bring people on the journey and support new programs. None of the new technology or analytics projects will be successful if HR can’t demonstrate strong skills in stakeholder management and consulting and influencing.
HR is definitely changing
There is clearly a lot that HR needs to consider when it comes to the impact of AI and automation on the function, and there is also a great impact that automation will have on the organisations that HR supports. It is critical that HR professionals are prepared to support the digital transformation within their companies or the HR function as a whole runs the risk of being left behind and seeing other departments (like IT or central analytics teams) step in to add value where HR is unable to. Howevever, there is a huge opportunity here for HR to partner with the business and add huge value by becoming more digital and data-driven, and I really hope that in a few years time, we will be able to look back and see how effective HR has become at transforming itself.
ABOUT THE AUTHOR
Ian Bailie is the Managing Director of myHRfuture.com and an advisor and consultant for start-ups focused on HR technology and People Analytics, including Adepto, Worklytics and CognitionX. In his previous role as the Senior Director of People Planning, Analytics and Tools at Cisco Systems, he was responsible for delivering the tools and insights to enable and transform the planning, attraction and management of talent across the organisation globally. Ian is passionate about HR technology and analytics and how to use both to transform the employee experience and prepare companies for the Future of Work.