Leveraging AI for Smarter Hiring Decisions
Introduction
AI has been transforming the HR function significantly, and more is to come. It has complemented HR in organizations by automating specific workflows or use cases. AI tools can provide data on various aspects of employees and candidates such as performance data, patterns, qualifications, and experiences of applicants. It can perform with speed and accuracy manual and repetitive tasks like screening resumes and scheduling interviews. It can recommend learning and up skilling opportunities to employees based on their experience, aptitude, and goals. It can enable HR to conduct objective performance evaluations of employees by providing appropriate data and patterns. AI is also effective in identifying potential mental and physical health problems in employees so that HR can take proactive steps. AI has enabled HR to focus on its core offerings such as talent and career development, and performance counselling.
This post will evaluate the impact of AI on HR with comparisons, data, and a case study.
HR function before AI
It’s hard to trace when AI was first used in HR functions but the organizations can be grouped based on their use of AI in HR in the following categories:
- HR with extensive use of AI
- HR with limited but evolving use of AI
- HR with no AI
Usually, small, proprietary, or organizations with few processes tend to still rely more on manual processes and may be slow to adopt AI. Organizations with limited but evolving use of AI have just started to realize the potential of AI but may identify more use cases or try to find budgetary provisions for more AI deployment. Note that even with organizations with extensive use of AI, there will always be scope for more.
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Before AI, here is how the HR function looked:
Manual recruitment workflow
HR representatives would manually advertise positions and receive thousands of applications. They would manually sift through and shortlist and set up interviews. The whole process was cumbersome and error-prone, and there would be a loss of time and resources.
Manual employee engagement workflow
Surveys such as employee satisfaction, happiness, and engagement were driven by emailed forms or, worse, paper forms. It was again a tedious, error-prone, and ineffective method. Many times, HR would lose data that would result in an inaccurate or false representation of employee behavior.
One-size fits all training and development
An organization employs people having different skills and experiences. Naturally, they would need customized training and development programs. Without proper data, HR would often conduct, or worse, push all employees into the same training programs. That would result in poor employee satisfaction, attrition, and low employee morale.
Case study
This is a real-world case study of how AI massively improved the HR function of Unilever, a British multinational fast-moving consumer goods (FMCG) organization with its headquarters in London.
Unilever would use traditional ways in its HR function which resulted in the same problems, as described earlier in this article. So, Unilever partnered with an AI startup to develop an HR platform that would extensively use machine learning algorithms. The machine learning algorithm would guzzle down tonnes of employee and other data and answer various queries based on the prompts or inputs. The users of the platform could get the data they wanted and develop various patterns or conclusions that helped them strategize or plan various employee learning, development, and engagement initiatives.
Ever since the new recruitment platform kicked in, over time, there has been a significant improvement in the overall hiring and recruitment workflows. One important data that came out was that the platform was behind a 90% reduction in the time taken to hire a candidate. Earlier, recruiting a candidate would take almost 4 months and it has come down to 4 weeks. That was a significant improvement. Another significant achievement has been identifying the right candidate for the right job. The platform improved the selection accuracy by 90%.
Impact of AI on the HR function
AI has impacted the whole gamut of the HR function and the following data support the observation.
The hiring process has become faster
LinkedIn, in one of their studies, had 67% of the respondents conclude that AI had expedited the hiring process. Organizations like Unilever and Hilton Worldwide have reduced the hiring time by 90%.
Candidate matching is more accurate
Aberdeen Group, a market intelligence company, found in a study that companies using AI for identifying candidates had a 240% increase in matching efficiency. Companies like Intel and PwC have hugely benefitted from using AI for identifying suitable candidates.
Better employee experience
Oracle conducted a study to find that 64% of the leaders concluded that AI could positively influence employee experience. Organizations like Adobe and IBM have already implemented chatbots that manage inquiries from the employees which results in higher employee experience.
Lesser bias
AI is less likely to have a bias when it comes to recruitment, career growth, or compensation. Companies like Intel and Deloitte have already been using AI tools that can reduce or eliminate unconscious bias in selection or recruitment and foster more diversity in employee strength.
Cost-effective for organizations
Accenture conducted a study to find out that the use of AI could potentially save companies up to $30 billion annually in the HR function. Already, companies like Unilever and Hilton Worldwide have been reaping benefits in terms of costs and efficiency by deploying AI tools in HR functions.
Conclusion
Obviously, AI has been having a profound impact on how HR functions, across the world. And this is just starting to gain momentum. There is a debate though, just like in any other profession, whether AI will eat up the jobs in HR function. The answer to the question is not straightforward, but there are ample functions in HR that AI can’t yet do. As of now, it’s merely complementing the HR and enhancing their capabilities, and helping them do their jobs. As of now, it is quite a stretch of the imagination that AI will be taking HR jobs.
