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AI in HR: A Powerful Ally in Achieving Organizational Excellence

By Ashley Litzenberger
8 minute read
Updated on May 17, 2024

AI in HR is not just a tool of the future — it’s revolutionizing the way we think about talent today.

The implications for AI adoption extend far beyond HR, too. “It is going to profoundly change the way that people work and the way that they innovate,” Betterworks CEO Doug Dennerline shared on a People Fundamentals webinar on Debunking 7 Myths About AI in Performance Management.

HR leaders play a pivotal role in leading the strategic adoption of AI tools to drive positive business impact. And most of your peers are feeling that pressure: Three-quarters (76%) of HR leaders surveyed by Gartner believe that implementing an AI strategy, particularly one focused on generative AI, must happen within the next two years to ‌remain competitive. 

Let’s explore some of the top applications of AI in HR and how AI-powered technology can benefit your organization.

The evolving role of AI in HR

The initial focus for AI in HR was automating simple tasks such as resume screening and basic employee queries. 

However, over the past year, we’ve seen a notable shift towards more sophisticated applications. AI is no longer just a backend processor; it’s become a strategic copilot in HR functions. This transformation has been driven by advancements in AI capabilities, including natural language processing, machine learning, predictive analytics, and generative AI — all tailored to support complex HR practices.

AI adoption use cases vary, with 43% of HR leaders aiming to use generative AI on HR service delivery solutions (employee-facing chatbots) and 42% on HR operations (admin tasks, policies), among other use cases, the Gartner report noted. 

Increasing rates of AI adoption in HR not only highlight AI’s growing capabilities but also reflect a broader shift in how organizations view their talent. With AI, HR can automate rote administrative tasks and apply advanced analytics and insights to strategic decision-making, shaping future trends in work with data-driven insights and foresight.

5 AI in HR examples

Let’s look at some practical, real-world applications of AI technology that significantly impact HR departments across industries.

Automating administrative tasks

AI can handle many aspects of payroll processing, benefits administration, and compliance reporting with precision and minimal oversight. By automating these tasks, you can free up your team’s time to focus on more strategic initiatives that require creativity and a human touch. In our research report, HR’s Guide to How the Workforce is Responding to Generative AI Challenges and Opportunities, we found that 36% of employees use generative AI for rote tasks to be more efficient at work.

Transforming recruitment and hiring processes

AI is transforming recruitment and hiring by optimizing job postings for better reach and fit, screening resumes with greater accuracy, and using predictive analytics to forecast candidate success. For example, AI-driven interviewing platforms can assess the content of candidate responses, ensuring you find the best fit for your organization.

More HR leaders are relying on predictive analytics to drive their talent acquisition strategies. By examining past hiring data, performance outcomes, and employee lifecycles, AI models can predict the success of potential candidates, identify the qualities of high performers, and help your HR team make data-driven decisions.

Improving employee experience

AI also plays a significant role in personalizing the employee experience. From a customized onboarding process that adapts to an individual’s learning style to career development tools that suggest paths based on performance and preferences, AI helps tailor the working environment to meet the unique needs of each employee.

Some organizations also use AI-powered HR technology to gauge employee morale and well-being through sentiment analysis of communication platforms and employee feedback mechanisms. These tools can detect recent changes in employee sentiment, providing HR with real-time data to proactively address concerns, adjust workloads, or modify policies to improve workplace culture.

Personalizing employee learning and development

You can personalize employee development with AI, and scale your program to help each person find the resources and tools they need to grow within your business. Using AI, HR departments can now offer customized learning experiences that adapt to an individual’s learning pace, preferred content type, and career aspirations. This not only enhances learning outcomes but also boosts employee satisfaction and retention.

Empowering real-time employee performance feedback

Most managers aren’t trained to give good feedback, but intelligent performance management systems equipped with generative AI help fill that skills gap. Betterworks’ Feedback Assist tool, for example, provides managers with personalized, constructive, and unbiased feedback for employees, leading to greater trust, focused career planning, and better outcomes. AI helps ease the burden on managers so they can provide their teams with better feedback more often.

Using AI to generate feedback appeals to employees as much as to managers. Our AI report found that 75% of employees are okay with AI writing their performance reviews as long as their manager reviews the content and adjusts it as needed for accuracy. 

Narrow AI versus strong AI: What’s the difference?

Understanding the difference between narrow AI and strong AI is crucial in recognizing the current and future trends in AI for HR.

Narrow AI

Tools we use daily, like ChatGPT, Gemini, Alexa, and other smart tools, are classified as narrow AI because they operate within a narrow scope and under limited constraints.

All AI solutions in HR today are forms of narrow AI. These systems are designed to perform specific tasks — such as parsing resumes or managing employee inquiries — and aren’t capable of performing outside their set parameters.

Strong AI

Strong AI refers to theoretical AI systems that could perform any intellectual task that a human being can. They would understand and reason through problems while possessing awareness and consciousness. Strong AI doesn’t exist today, although rapid technological advancements could bring it about in our lifetimes.

3 benefits of AI in HR for your organization

AI tools can optimize your processes in ways that humans alone simply can’t. Here are some of the primary benefits of introducing AI into your HR processes.

Better decisions

AI’s ability to rapidly analyze large sets of data can support better-informed decisions about everything from talent management to succession planning. 

Predictive analytics tools, for example, can extract and provide insights based on your existing employee data. AI can use trends in data to generate suggestions to support your talent strategy. These insights can help you make better decisions, enabling your team to work alongside leaders to fulfill your company’s business needs.

Better data benefits not just HR. Managers make many decisions affecting talent strategy and operational performance, and hiring managers make decisions every day that affect larger initiatives, like diversity and inclusion.

“When they are actually given rational data to make an informed choice, they do rise to the occasion,” said Paul Rubenstein, chief customer officer at Visier, on an episode of the People Fundamentals podcast. “And if you can give them that data … persistently, that’s how you start to change behaviors.” 

Enhanced skill management

AI tools enable HR and direct managers to better support employees, empowering employees to contribute their best and pursue skill development opportunities. For example, AI software can recommend career moves to employees and project a route to achieving their goals by integrating learning resources, potential career paths, and employee assessment data. 

“Employees constantly want career growth and development,” said Sabrina Park, senior director of global talent management at Rivian, on an episode of the People Fundamentals podcast. “And so if you have technology to help accelerate that or make it more transparent, I think that’s all the better.”

An intelligent performance management system can track skills as employees develop them in the flow of work, giving you a better view of workforce capabilities. An AI-powered skills architecture helps employees see opportunities for growth. 

“If we understand the skills that people have, we’ll be able to understand how they might be able to move in the organization,” said Stacia Garr, co-founder and principal analyst at RedThread Research, in a 2024 EmpowerHR session, “and thus enable them to have better careers and create more flexibility.” 

Improved efficiency

AI tools have the power to free up a lot of HR professionals’ time, which you can now devote to more strategic work. Many critical HR tasks are transactional and highly time-consuming, such as payroll administration and data management. AI-powered software can optimize these so you and your team can spend more quality time on high-impact projects.

How to mitigate risks of using AI in HR

While AI’s benefits are significant, it’s also crucial to address the challenges and risks associated with its use in HR. From protecting sensitive data to ensuring fairness and maintaining trust with employees, here are some ways to minimize the risks of using AI in HR.

Protecting data privacy

Given the sensitive nature of employee data, it’s imperative to prioritize data privacy and security. Advanced security measures, such as encryption, secure data storage solutions, and regular security audits, can help protect data against unauthorized access and cyber threats.

Ensure that access to sensitive data is restricted to authorized personnel only. Employing role-based access control and continuously monitoring access logs can help prevent internal data breaches.

Reducing bias in AI systems

AI systems are only as unbiased as the data they’re trained on. One generative AI challenge, for instance, might include feeding the right information into your performance management system to generate a fair and unbiased performance review. 

To minimize the risk of perpetuating existing biases, use a wide range of data sources to train AI models. This helps prevent the system from developing biased algorithms based on limited or skewed data sets. Additionally, conduct periodic reviews and updates of AI algorithms to identify and mitigate against any biases that may have crept in. Employing third-party auditors can provide an unbiased assessment.

Managing employee perceptions

Transparency is key in managing employee perceptions of AI. Regularly inform employees about what AI tools are being implemented, the rationale behind their use, and how they’ll impact the work environment. 

“Be careful when applying AI, but don’t let an overabundance of caution prevent your organization from realizing its benefits,” Andrea Lagan, chief operating officer at Betterworks, writes in a Betterworks blog post. “Frequent, transparent communication with employees can quell their fears, especially when you’re upfront with how the organization is using AI and how you’re addressing risk.”

As part of your communication plan, demonstrate how AI systems benefit employees, such as through personalized training programs, more efficient HR services, or fairer, unbiased evaluations.

Engage with employees to get their input and feedback on AI tools. This can help ensure that the tools are implemented in a way that meets employees’ needs and makes them feel involved in the process.

Empowering progress through AI in HR 

Embracing AI in HR not only enhances your department’s efficiency and effectiveness but also sets the stage for broader organizational transformation. As you consider integrating AI into your HR practices, focus on strategic implementation and ongoing evaluation to harness its full potential. With careful planning and thoughtful application, AI can indeed be a powerful ally in achieving HR excellence and fostering a more engaging, productive workplace environment.

Want to learn more? Discover 10 of the biggest challenges for HR.