Article
3 min read
Author
Gabriele Culot
Published
May 21, 2024
Last Update
June 27, 2024
Table of Contents
Understanding AI in human resources
Scaling the hiring process with AI
AI in talent management and employee engagement
AI-driven learning and development
Reducing human error in payroll and benefits admin with AI
Improving employee retention and satisfaction with AI
AI-backed decision-making in HR
Challenges and considerations when implementing AI into HR processes
Strike a balance between AI and human work
Discussions of artificial intelligence (AI) today typically divide human resources (HR) professionals into one of two camps: those embracing AI’s potential and those who are still reluctant. Somewhere in between, there’s a middle ground where many leaders are finding they need to land.
AI is continuously expanding its capabilities and becoming more sophisticated as new use cases arise. AI will magnify in importance as various teams find ways to leverage it. HR leaders are feeling the urgency, with 76% of them convinced that their organizations must adopt AI tech solutions within the next 12 to 24 months or risk lagging behind their competitors, according to Gartner.
AI simulates human intelligence using machines or systems programmed to think like people do. Over time, with more and more data input into AI tools, these technologies become adept at problem-solving, learning from past interactions, and making more sophisticated predictions.
In HR, AI can become a cost-effective sidekick—automating everyday tasks, analyzing vast datasets, and extracting insights for better decision-making within HR departments and small businesses. Using data analytics, natural language processing (NLP), and machine learning (ML), AI can assist with a wide range of tasks, from talent acquisition and onboarding to employee engagement and people management.
Here are four key applications of AI in HR operations:
Finding qualified job candidates can be a significant hurdle when you must sift through hundreds or even thousands of applicants. Here’s how AI in HR makes the hiring process more efficient:
AI-powered solutions can help HR leaders improve talent management and employee engagement programs—from identifying and hiring top talent to fostering employee development, engagement, and retention. Here’s how AI empowers HR leaders to deliver exceptional candidate and employee experiences:
AI-driven learning experiences and skill development are crucial in today’s workplaces, given employees’ desire for clear career paths and advancement opportunities. AI algorithms can analyze employee feedback, performance reviews, and previous learning engagements to assist with:
You will instantly see the positive impact once you incorporate AI into HR benefits and payroll administration. AI can automate many routine tasks, allowing HR professionals to focus on strategic activities requiring human expertise.
Moreover, AI enables enhanced accuracy, automating tasks such as payroll processing and benefits administration while reducing the likelihood of human error. This accuracy ensures accurate compensation and benefits for employees and minimizes errors. Additionally, AI systems can automate compliance checks, reducing the risk of errors, penalties, and legal issues.
And yes, when it comes to payroll, human errors happen — with the top mistakes being missing or incorrect time punches, according to EY research. There are direct and indirect costs involved with fixing each type of error — with an average cost per incident of $291. Some errors incur even higher costs; for example, mistakes related to employee onboarding average $635 per incident.
AI algorithms are adept at gathering and analyzing data, predicting employee turnover, and crafting retention strategies addressing workers’ needs. Key areas where AI can assist retention include:
Making faster, more accurate decisions is a superpower many HR leaders want to possess. With AI enabling better data and insights, HR professionals are tapping into that capability — saving time, increasing efficiency, improving recruitment, and reducing costs.
AI-powered recruitment platforms offer real-time insights on job postings, candidate sourcing, and hiring processes, allowing HR teams to refine strategies based on applicant feedback and improve the candidate experience and conversion rates. Meanwhile, AI algorithms can analyze workforce data and market trends to forecast future needs, allowing HR teams to adjust staffing levels and recruitment strategies in real-time.
According to SHRM research, AI in HR is growing by leaps and bounds, allowing greater agility in various aspects of HR:
While AI offers numerous benefits for HR teams, there are some challenges and other considerations to address when implementing AI in HR, such as:
If you're just using the technology to do all of the work, it can be a detriment to you and your team members, as there could be misinterpretations, work that goes against company policies, or errors as a result of bias within AI.
—Nadie Alaee,
Senior Director of HR, Deel
Embracing the future of HR means recognizing the dynamic interplay between AI tech advancements and regulatory frameworks, and committing to ongoing learning and adaptation. HR leaders are required to keep up with AI innovations and regulatory mandates.
Active engagement in industry forums, continuous professional development, and collaboration with regulatory bodies are vital for shaping the responsible and ethical integration of AI in human resources. Through this proactive approach, HR teams can adeptly navigate challenges and seize opportunities, ensuring compliance and positioning HR as a catalyst for innovative organizational change.
Deel is at the forefront of future-of-work technologies, including AI, offering globally compliant contracts, worker mobility solutions, and a comprehensive HR management suite. Now, both workers and employers can concentrate on their critical work while entrusting the intricacies of HR management to Deel.
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