AI and Automation Quick Wins that HR Teams Should Focus On
Is your HR department failing to embrace the digital transformation (especially AI) revolution? If so, you are not alone.
Human resources departments are notorious for lagging behind in adopting new technologies. It comes as no surprise that the use of automation and artificial intelligence in HR is still relatively rare compared to other departments in organizations across different industries.
A 2018 McKinsey survey confirms this. Looking at the results of the study, the adoption rate of HR automation and AI is highest in the high tech industry with adoption by 21% of the respondents surveyed. Among businesses in the travel, transport, and logistics industry, only 2% of HR teams are using AI and automation.
Even the high end of this range is low compared to other business areas such as service operation and product/service development.
AI and automation adoption in HR across different industries remains low compared to other business functions where these technologies are maximized more (Image Source).
The Cost of Not Using AI and Automation in HR
As with any endeavor involving automation and artificial intelligence, the goal of using these technologies in HR is to make both day-to-day routine tasks and complex processes free from human intervention. The ultimate objective is efficiency.
As explained by CareerBuilder HR officer Rosemary Haefner, “We always say, ‘I wish I had more time to plan, to think, to keep up on new trends, to strategize.’ To have 14 hours back in a week, the majority of that would be well spent planning for the future instead of reacting to the present. Time would also be spent connecting with the business, with employees. That may mean catchups with company leaders, educating yourself on the company’s products/services, learning the industry, and networking outside the walls of your office.”
Not taking advantage of existing AI and automation HR solutions can lead to negative repercussions. A poll commissioned by CareerBuilder revealed that lack of automation leads to the following losses and negative results:
- 41% lower productivity
- 40% more errors
- 35% higher HR costs
- 18% more instances of poor candidate experience
- 17% more instances of poor employee experience
- 17% decline in employee engagement
- 11% more instances of poor hiring manager experience
While AI and automation platforms can’t replace the “human aspect” of HR that shapes company culture and creates an overall positive work environment, these technologies free up a significant amount of time among HR managers so they can focus on more important tasks. It transforms your HR department from an administrative auxiliary to a department that helps an organization’s overall growth.
AI and automation are typically major initiatives that require a significant amount of resources. However, there are low-hanging fruits that businesses can focus on to jump-start the process. Here are a few of them:
1. Reduce Time Spent on Scheduling and Payroll Preparation
How many hours have you spent replying to emails from employees asking about their shift schedules? How many hours have you spent reviewing and correcting manually prepared time sheets?
As it turns out, a significant amount of time is spent on these things. For instance, according to the National Small Business Association, 24% of businesses spend more than 120 hours per year preparing payroll and other reports related to employee compensation. That’s roughly 6 days per year that could have been used for initiatives that directly support your company’s overall growth objectives.
A significant amount of time is wasted on payroll preparation and other related reports
Automating these processes doesn’t take a significant amount of monetary investment and a lot of time to implement. A number of digital time tracking and scheduling solutions are available. You can also choose one that fits your needs, budget, and internal processes. Most of these platforms are almost plug-and-play so you can hit the ground running and reap the benefits of automated time tracking and scheduling.
The benefits of payroll and scheduling automation, when implemented properly, can cut down payroll preparation time by 80%. This doesn’t include the amount of time that could be saved by your HR team answering queries about shift schedules as well as the time savings for your employees from manually filling out their time sheets.
2. Better HR Decisions with Data
Artificial intelligence has made data collection, organization, and analysis a hundred-fold faster. It has also made a positive dent on how businesses use data. AI has enabled retailers to better manage their inventories, made the identification of potential cybersecurity threats faster, and has made power grids smarter.
Recently, AI is making headway in helping HR teams make smarter decisions.
- AI-driven HR analytics makes testing of the effectiveness of HR policies and interventions possible
- It allows you to estimate the effect of employee engagement on your organization’s financial performance
- It allows you to efficiently identify potential leaders and high-impact employees that can add to your company’s bottom line
In summary, using AI in HR allows HR leaders to transform data into insights and insights into concrete actionable plans. It allows you to measure the business impact of HR, which makes it a profit center for your organization and not just an administrative hub.
3. Improve the Recruitment Process
The success of a business lives and dies with the quality of its people. Given the talent shortage that a number of industries are experiencing right now, there’s a huge responsibility resting on HR teams to find, hire, and retain top talent.
A post in HR Analytics posits: “Imagine that you can predict which new hires will become your highest performers in two years. Or that you can predict which new hires will leave your company in the first year. Having this information will change your hiring & selection procedures and decisions.”
With AI, you don’t have to imagine or guess. Artificial intelligence will revolutionize your hiring process by using a number of data points as key success indicators for how potential employees will perform in your organization.
Keep Up or Miss Out?
This is essentially the question you’re facing when making the decision of whether you should implement automation and AI in your HR or not. Sure, your HR team can continue functioning without these technologies, but this is saying “no” to the many benefits that HR automation and an AI-driven HR can bring to your business. Overall, the more efficient scheduling and payroll preparation, smarter data-driven decisions, and streamlined recruitment make AI and automation worthy HR investments.