Exploring the rise of AI in HR

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HR is increasingly using AI-powered tools – but what are the benefits and challenges of this technology?

IF YOU search for ‘resume tips’ on Google, you’ll likely find some advice on how to avoid being screened out by an algorithm. As a candidate, you might receive an automated interview reminder or have your pre-interview questions answered by a chatbot. AI-powered tools are increasingly common in HR, and not just in the hiring process. AI helps to automate and streamline a variety of tasks, including onboarding and training, performance evaluation and employee engagement, with AI chatbots giving employees real-time feedback and support.

Established in 1983, Frontier Software is an acknowledged leader in the provision of a global HR & Payroll software solution. Its software – called ichris (International Comprehensive Human Resource Integrated Software) – sets the benchmark for human capital management software. Frontier Software provides HCM solutions and services to over 1,700 customers in 26 countries, from small to very large enterprises. Its software is used to provide an efficient payroll service from its global offices in Australia, India, Malaysia, New Zealand, the Philippines, Singapore and the UK. Frontier Software ensures proven long-term growth via prudent investment in its people and software products/services. A perfect solution.

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HR sees value of AI in Recruitment

“In the future, it’s possible that AI will be relied on more than it is today as AI technology becomes more advanced and capable”

Liviu Marciu, Frontier Software

To use AI tools effectively, it’s important to understand the benefits and challenges of this technology. HR leaders should also have a good grasp of when it’s appropriate to use AI and which decisions will need human oversight. According to Liviu Marciu, chief technology officer at Frontier Software, many companies are still figuring out how to get the balance right – and while some have been doing a great job of using AI to improve their processes, others are still “struggling to find the right approach”.

There’s no doubt that AI has taken a lot of administrative tasks off HR’s plate. AI tools have been used to automate candidate screening and sourcing, helping HR teams to find the right candidates more efficiently. Virtual assistants can also provide employees with on-demand support, which is directly linked to engagement and turnover. Marciu notes that AI-powered tools are also increasingly being used in onboarding, providing new hires with personalised information and training, and managers are using AI to analyse employee performance and data. This helps HR teams identify skills gaps and provide targeted training and development opportunities.

“Overall, AI tools can help HR teams to work more efficiently, reduce bias in the recruitment process, and improve the overall employee experience,” Marciu says. “However, there are several challenges that HR teams face when using AI.” Marciu explains that to operate effectively, AI needs large amounts of “accurate and relevant” data, which can be difficult to obtain when building a tool’s capabilities from scratch. He notes that there is also a risk of humans passing their biases on to AI through historical data or assumptions, which could increase the risk of discrimination. The privacy and security of your data also needs to be considered, and the initial implementation can be complicated and time-consuming. Working with new AI tools can also present challenges for employees, as it fundamentally changes the way they communicate with HR.

When it comes to finding the right balance, Marciu says the trick is in understanding that AI is very much a support tool, and not a replacement for the entire HR function. “The ‘right’ way to use AI in HR is to automate time-consuming and repetitive tasks, such as resume screening and candidate matching, which can help HR teams save time, and enable focus on higher-level tasks,” he says. “AI can also be used to identify patterns in employee data, such as turnover rates, to help HR teams identify areas for improvement and make data-driven decisions. “Another ‘right’ way to use AI in HR is to provide personalised learning and development opportunities to employees, based on their individual learning styles and preferences.” When it comes to the ‘wrong’ way, Marciu says HR professionals should not be handing over important decisions solely to algorithms. This includes making a final hiring decision without human input, which can lead to bias and discrimination. “Another ‘wrong’ way to use AI in HR is to use AI to monitor employee behaviour without their knowledge or consent, which can violate their privacy and lead to distrust and disengagement,” he adds. “The key to getting started with AI is to start small, involve employees, ensure data quality and privacy, and seek expert advice and support.”

“AI can be used to identify patterns in employee data, such as turnover rates, to help HR teams identify areas for improvement and make data-driven decisions”

Liviu Marciu, Frontier Software

AI technology is evolving very rapidly, and it’s bringing some exciting opportunities with it. As it becomes more advanced and accessible, HR teams will have more opportunities to automate administrative tasks, make more data-driven decisions, and provide personalised learning and development opportunities. “One area where AI is likely to have a significant impact is in recruitment,” Marciu says. “AI can help HR teams automate tasks such as resume screening, candidate matching and interview scheduling, which can save time and improve the efficiency of the recruitment process. AI can also help HR teams identify patterns in candidate data, such as their education, work experience and skills, to make more informed hiring decisions.”

AI is also promising to be a useful tool for employee engagement and retention. It can help identify patterns in data, such as turnover rates, job satisfaction and performance, and can identify very specific and personalised areas for improvement. Marciu says that overall, the future of AI in HR is very promising. We’re likely to see more companies adopting AI technology to improve their processes, and the data collected by AI will help HR leaders make more informed decisions across their businesses.

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Published 17 Apr 2023

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95%

of HR professionals think AI can help with the application process for candidates

68%

of recruiters agree that AI can help remove unintentional bias from the hiring process

Source: Tidio, 2023

Source: BusinessDIT, 2023

64%

of HR professionals say they use AI tools to automatically screen out unqualified candidates

85%

of employers say AI tools save time and improve efficiency

Use of AI in HR: the stats

92%

of HR leaders plan to use AI to acquire talent in the future

“In the future, it’s possible that AI will be relied on more than it is today as AI technology becomes more advanced and capable,” Marciu says. “However, it’s important to note that AI should never be used as a replacement for human judgment and decision-making. HR teams will still need to provide oversight and input into AI systems to ensure that they are making fair and ethical decisions.”

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“AI can be used to identify patterns in employee data, such as turnover rates, to help HR teams identify areas for improvement and make data-driven decisions”

Liviu Marciu, Frontier Software