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WP StateofArtificialIntelligenceinHR HarbingerSystems 112717 PDF
WP StateofArtificialIntelligenceinHR HarbingerSystems 112717 PDF
WP StateofArtificialIntelligenceinHR HarbingerSystems 112717 PDF
of Artificial
Intelligence
in HR
Getting up to speed
on AI in order to gain
maximum advantage
for the HR function
Sponsored by
NOVEMBER 2017
www.hr.com | 877-472-6648
The State of Artificial Intelligence in HR
Contents
Executive Summary 3
Key Takeaways 24
Executive Summary
Artificial intelligence will transform HR technologies over the next five
years, suggests new research conducted by HR.com. In the meantime, About the Survey
though, HR professionals have much to learn.
The State of Artificial
Below is an overview of some of the key findings from the study:
Intelligence in HR survey ran
• As a profession, HR is still toward the bottom of the AI learning curve. in August and September of
Very few (8%) respondents strongly agreed that they are knowledgeable 2017. It was conducted by
in this area, and only another 27% even moderately agreed. HR.com. We gathered 995
usable responses from HR
• Current usage rates are low but are expected to explode professionals and people
in coming years. Whereas only 7% of respondents say managers in virtually every
their organizations make use of AI to a high or very high degree industry vertical, with the largest
today, over five times as many (39%) say expect their organizations industry groups being services,
will be doing so in five years. That number is higher (57%) among manufacturing and computer/
respondents who consider themselves knowledgeable about AI. telecom. The participants
represent a broad cross-section
• AI has the greatest potential to enhance HR in five functional of employers by number of
areas: analytics and metrics, time and attendance, talent acquisition, employees, ranging from small
training and development (T&D), and compensation and payroll. businesses with under 50
employees to enterprises with
• The ability to analyze and predict are the AI features HR pros want
20,000+ employees.
most from AI-powered applications. The ability to personalize
is the third most desired feature.
• HR professionals expect that AI will be used more for automation than augmentation. Over
half (54%) agreed to a high or very high extent that using AI to automate various tasks will become
prevalent in their organizations over the next five years. Only 35% agreed that the augmentation
of employee abilities would become more prevalent, but AI-knowledgeablea respondents were
much more likely to foresee employee augmentation.
• HR will make use of automated AI interfaces to aid employees. Seventy-percent anticipate that
AI interfaces such as chatbots and virtual assistants will become an increasingly viable way for
employees to get real-time answers to their HR-related questions.
• Your next boss may be an AI. Employees will increasingly take direction from AIs, according to
53% of respondents, whereas only 13% said this wouldn’t happen.
• More respondents predict job losses than job gains as a result of AI in their organizations.
Although a majority of respondents do not think AI-related technologies will bring about a significant
gain or loss of jobs in their organizations, nearly twice as many say there will be a net loss of jobs
as say there will be a net gain.
• AI is widely viewed as a valuable talent acquisition tool. Most (70%) respondents agreed that
AI-based algorithms can be used to improve recruitment by scanning work samples, resumes and
other materials and then predicting which ones are most likely to lead to good hires.
• Most HR professionals have conflicted feelings about the potential power of AI to monitor
and report back on employees. Few respondents said they either love or detest the idea of using
AI to monitor employees. Most said they either “like the idea but have some reservations” (34%)
or “dislike the idea but it has some merits” (36%).
The modern concept of AI dates back at least as far as Alan Turing, the English
mathematician who proposed the universal Turing machine in 1937. It became
the basis for today’s programmable computer. He also introduced the famous
“Turing Test” as a way of gauging intelligent behavior in computers.
It was John McCarthy, however, who coined the term artificial intelligence in 1956.
In the 1950s, much progress was made in the field, including the development
of a checkers-playing program capable of challenging the world champion.
Since then, of course, a great deal of progress has made in many AI subfields
such as machine learning, case-based reasoning, data mining, natural language
processing, computer vision, robotics, game playing and more.
In recent years, investors have bet on the idea that AI will play an integral role in a
wide range of commercial applications. The research firm CB Insights reports that
“combined, the 10 largest tech companies have acquired 50 AI companies in the
last 5 years, targeting facial recognition startups, chatbots, chip makers, and more.”
But it isn’t only the largest tech companies that are investing in AI. In 2016, AI
attracted over $5 billion in venture capital (VC) funding, and some experts think
it’s likely AI will continue to attract a very large portion of VC funding in coming
years. CloudTweaks reports that “during the time of 2012 to 2016, the number
of deals rose from 160 to 658 each year while funding hit a record high of $5.02
billion last year as compared to just $589 million in 2012.”
These trends are already affecting the field of human resources. HR technology
leaders foresee AI’s growing role in a variety of areas such as aiding recruitment,
improving compliance, augmented training, streamlining onboarding and more.
To gain a more detailed picture of how HR is currently using AI—and will use it
in the near future—HR.com conducted “The State of Artificial Intelligence in HR”
survey in August/September 2017. Following are the primary findings and insights
from this large and detailed survey.
Most HR professionals still have much to learn about how to use AI to enhance the
HR function. Very few (8%) respondents strongly agreed that they are knowledgeable
in this area, and only another 27% even moderately agreed. This lack of knowledge
is natural, given AI’s technical nature and its rapid evolution in recent years. However,
the HR profession needs to “get up to speed” on AI technology because, as we will
see, its influence and importance are expected to grow quickly in the near future.
FIGURE 1
8%
12% STRONGLY AGREE
STRONGLY DISAGREE
30%
For the purpose of this paper, we will use the data from this section to separate
survey participants into two groups:
In some sections of this report, we will illustrate how these two cohorts view AI’s
future in the HR function in different ways.
Finding Two: Current usage rates are low but are expected to
explode in coming years
FIGURE 2
What accounts for that wide divide? Perhaps HR professionals with greater AI
knowledge have a more accurate insight into the future of AI in HR. If so, then
AI will soon become even more important to HR than the average response
would lead us to believe. On the other hand, perhaps the AI-knowledgeable
respondents are more passionate about this topic and so overestimate AI’s
future influence, even within the context of their own organizations.
FIGURE 3
Survey Question: For HR purposes, to what degree will your organization make
use of AI in five years?
Among AI-
Percent indicating high or very high degree unknowledgeable
participants,
AI-Knowledgeable 57% only about a
fifth said their
Average 39% organizations will
make use of AI
to a high or very
AI-Unknowledgeable 19%
high degree in
five years
0 10 20 30 40 50 60
As the Society for Human Resource Management recently reported, “Tools designed
to help HR leaders understand and predict the impact of talent decisions were among
the first to hit the market and now help forecast employee flight risk, identify high-
potential employees, unearth engagement issues, recommend learning courses and
more.” In other words, AI-based HR analytics can be applied across a wide range of
HR functions.
FIGURE 4
Survey Question: Select the features you would you most like to see in an AI-powered HR
application? (select up to four)
80
78%
70 HR professionals
are most interested
60 63%
in AI’s ability to
57%
50 54% analyze, predict
50% and personalize
40
39%
30
20 23%
10
10%
0
Ability to Ability to Ability to Ability to Ability to Ability to Ability to Ability to
analyze predict personalize diagnose organize augment simulate gauge
skills emotions
When we asked respondents about where they thought AI has the greatest
potential to improve HR in coming years, the most popular responses—by a wide
margin—was analytics and metrics. Again, we believe this is because analytics is IMAGE
a natural AI strength and because it can be applied across many HR functions.
The other top-rated response items are more well-defined by HR function. They include:
The vast majority of organizations, even smaller ones, need to track employee
“time and attendance” as well as “compensation and payroll,” so applying AI to AI is viewed as
these data-heavy areas makes sense, especially from an analytics point of view. having the highest
potential in the HR
FIGURE 5 analytics function
Survey Statement: Select the areas where you think AI has the greatest
potential to improve the HR function in the next five years. (select all that apply)
80
79%
70
60
56%
50 54%
52% 51%
48%
40 42%
40%
37%
35% 35%
30 31% 30% 28%
20 22%
16%
10 12%
3%
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Prediction is the second most widely preferred AI feature (see Figure Four). Why?
Because it is a major component of many HR professionals’ jobs. That is, they must
be able to anticipate a wide range of factors, such as:
This list, of course, could be much expanded, but one area worth focusing on
is talent acquisition. As Figure Five shows, talent acquisition was the third most
widely cited area where AI has the opportunity to improve the HR function. Even
more interesting, 59% of AI-knowledgeable respondents chose talent acquisition,
making it the second most widely chosen item among that cohort.
Successful talent acquisition largely hinges on predictive ability. AI-based algorithms Seventy percent
can be used to scan work samples, resumes and other materials (see Figure Six) believe that AI-
and then predict which ones are most likely to lead to good hires. Moreover, AI can based algorithms
potentially be used to analyze and predict based on a range of other types of data, can improve
from online candidate profiles to word choice and even facial expressions. recruitment
FIGURE 6
Survey Statement: Using AI-based algorithms to scan work samples, resumes, and
other materials presented by applicants improves the recruitment and selection process
3%
8% 19%
STRONGLY AGREE
AGREE
19%
NEITHER AGREE NOR DISAGREE
DISAGREE
STRONGLY DISAGREE
51%
It is true, however, that AI will become even more important. In fact, two-thirds
expect AI to be important to overall HR technologies in five years (see Figure
Seven). For the AI-knowledgeable cohort, the number rises to 79%.
Respondents predict huge jumps in importance for other areas as well. One In these six areas,
worth mentioning is learning and development. Not only do 63% expect AI HR professionals
to be important to T&D in five years, that number jumps to 72% for the predict massive
AI-knowledgeable cohort. increases in the
At a more general level, AI is expected to have a major impact on overall employee importance of AI
productivity as well as what we could call “cognitive productivity” in form of
better decision making and strategic planning.
FIGURE 7
Survey Question: How important is AI to this HR area and how important do you expect
it to be in five years? [percent important and very important]
70
67%
60 63%
40
30
20 23%
20% 21%
18% 18% 18%
10
interest in AI is “pushing established software vendors to introduce AI into their UPGRADING NOW.....
Things have happened quickly in this area over the last couple of years. Gartner.com
reports that in January 2016, the term “artificial intelligence” wasn’t among the top
100 search terms on its website but that by May 2017, it ranked as number 7.
Gartner isn’t the only source picking up on the increasing popularity of AI as a search
term. Google Trends, which is based on global Google searches, shows an increase
from 27 in 2014 to 100 as of July 2017 (see Figure Eight).*
FIGURE 8
100
80
60
40
20
0
7-20-2014
9-20-2014
11-20-2014
1-20-2015
3-20-2015
5-20-2015
7-20-2015
9-20-2015
11-20-2015
1-20-2016
3-20-2016
5-20-2016
7-20-2016
9-20-2016
11-20-2016
17-20-2016
3-20-2016
5-20-2016
7-20-2016
9-20-2016
*Note: Google indexes its data to 100, where 100 is the maximum search interest for the time selected.
Other figures are a proportion of that 100 number.
Amid all the general interest in AI—and the specific interest in AI within the HR
function—HR vendors become more likely to tout AI capabilities of their products.
As a result, HR professionals will need to hone their abilities to gauge the quality
of those offerings and discern hype from reality.
Some experts, however, do not agree that automation will trump augmentation
in coming years. When the MIT Sloan School of Management hosted the 14th
annual CIO Symposium in May 2017— “The CIO Adventure: Now, Next and…
Beyond”—it put together an expert panel that discussed the automation vs.
augmentation question. MIT Sloan Management Review reports the following:
[MIT Media Lab’s Joi Ito] argues that augmentation—that is, using
machine learning to improve industrial processes, workplace efficiency,
and customer experiences—is the more common way to leverage the
technology today, and the panel finds consensus around this idea.
Azarbayejani’s firm, Cogito Corporation Inc., for example, employs AI
to understand the nuances of how people use words in conversations,
using the knowledge to provide real-time feedback to frontline staff in
call center environments.
In another example, a Boston University study recently found that “people hated
talking to a machine during customer service encounters, even if it’s a supposedly
smart, Siri-like interactive voice response system,” according to the Forbes article
Why AI Should Augment, And Not Replace, Staff. But AI can help customer
service employees quickly locate answers to typical customer questions, thereby
enhancing the quality and productivity of such workers.
FIGURE 9
0 10 20 30 40 50 60
AI-knowledgeable respondents were also more likely to give the nod to automation
(69%) over augmentation (57%), but their responses differed in two ways. First, the
predicted gap between the two uses of AI was narrower. Second, they were much
more likely to believe augmentation would play a major role over the next five years.
FIGURE 10
0 10 20 30 40 50 60
As Figure Four shows, the “ability to augment skills” was chosen by only 39% of
respondents when they were asked about which features they’d most like to see in
an AI-powered HR application. It was ranked sixth out of eight possible features. It
seems most HR professionals are not focused on the topic of skills augmentation.
We must note, however, that many of the most desired features of AI-powered
HR applications—such as the ability to analyze, predict and diagnose—could
conceivably be used to augment rather than replace HR professional jobs. To a
degree, therefore, some of the distinctions between automation and augmentation
are a matter of semantics.
1%
6%
25%
STRONGLY AGREE
20%
AGREE
DISAGREE
STRONGLY DISAGREE
48%
Will AIs actually manage human beings? That depends on our definition of
“manage.” AI-capabilities may well continue to improve project management
software. Writing in Psychology Today, Ray Williams argues that “many routine
basic administrative coordination and control tasks such as resource allocation,
reporting and scheduling will be done by AI.”
AIs will not, however, soon be able to listen to employee concerns, make Nearly two-thirds of
judgements, facilitate teams, address personality conflicts and the like. For AI-knowledgeable
this, human managers and leaders will be needed. Managers will likely view AI
respondents say
software as a powerful management tool and perhaps even a kind of colleague.
employees will
increasingly take
FIGURE 12
direction from AIs
Survey Question: Over the next five years, employees will increasingly
take direction from AIs that allocate and assign tasks to them (for example,
by using automated project management software).
3% 8%
10%
STRONGLY AGREE
AGREE
45% DISAGREE
34%
STRONGLY DISAGREE
Finding Fifteen: More respondents predict job losses than job gains
as a result of AI
27%
58%
THERE WILL NOT BE A SIGNIFICANT GAIN OR LOSS
15%
But there are also areas related to talent acquitions where AI might play a role
as well. These areas are potentially more controversial uses of AI because
they go beyond just scanning materials presented by applicants. Following are
two more areas related specifically to recruitment and selection.
Well over half (59%) of respondents agreed or strongly agreed with the statement
that “using AI-based algorithms to scan and analyze social media posts, photos
and other candidate-related online materials improves the recruitment process.”
This type of usage of AI, however, raises a number of issues. Should a job
candidate’s online communications and images, which were often not intended
to be work related, be used to make recruitment decisions? After all, such
information was not typically available before the age of the social media and
might be perceived by some as an invasion of their virtual private space.
Another issue is that such communications could reveal much about a candidate’s
ethnicity, religion, gender, country of origin and other factors. This could potentially be
problematic because Title VII of the U.S. Civil Rights Act of 1964 prohibits workplace
discrimination based on religion, national origin, race, color, or sex characteristics.
Of course, it can be argued that AI does not change anything in this area. Using
social media for hiring is already perceived as a risk that must be managed.
“Social media profiles have become founts of information for recruiters vetting job
candidates, presenting a risk not only to applicants whose personal posts may
hurt their chances but also to employers who might discover details they don’t
want seeping into their hiring decisions,” reports the Chicago Tribune.
FIGURE 14
Survey Statement: Using AI-based algorithms to scan and analyze social media posts,
photos and other candidate-related online materials improves the recruitment process.
4%
13% Just 15% disagreed
11%
STRONGLY AGREE that recruitment
can be improved
AGREE
by scanning and
NEITHER AGREE NOR DISAGREE analyzing social
26%
DISAGREE
media posts,
photos and other
46% STRONGLY DISAGREE
candidate-related
online materials
FIGURE 15
6% 8%
STRONGLY AGREE
Most do not yet
22% trust AI to read
AGREE
candidate emotions
32% in a dependable way
NEITHER AGREE NOR DISAGREE
DISAGREE
STRONGLY DISAGREE
32%
Survey Question: How would you feel about AI software that tracks everything your employees
do on their digital devices (desktop, laptop, smartphone, etc.), analyzes those activities, and then
regularly reports back to their supervisors with a summary and recommendations? (check one)
40
35 37 %
34%
30
HR professionals
25 are of two minds
20 about using AI to
15
18% monitor employees
10
5 7% 2% 2%
0
I love the I like the idea I don’t care I dislike the idea I detest the Other - write in
idea but have some one way or but it has idea
reservations the other some merits
Key Takeaways
In light of these research findings, what steps should organizations take? Below
are eight key takeaways that may help.
1. Boost HR’s AI IQ. Few HR professionals believe they are very knowledgeable
about using AI to enhance HR, so the first order of business is for more HR
professionals to “get up to speed” in the area of AI. This means reading reports
(like this one) and articles, speaking with internal and external experts, attending
HR
conferences, tracking trends, and otherwise climbing the AI learning curve.
2. Prepare for both advances and marketing jargon. There have been, and will
continue to be, many amazing advances in the field of AI, and these advances
will soon be applied to HR technology products. However, as AI becomes more
integral to HR technologies, there will be a lot of hype from marketers. This
is one of the primary reasons HR pros need to boost their AI IQ. Unless they
do, they will not know how to separate the wheat from the chaff and so wind
up spending a lot of money on products that cannot perform as advertised.
3. Determine where AI can help your HR function most. This will vary accordingly
to organizational needs and the evolution of HR technology itself. For now,
at least, HR professionals see the greatest potential in the areas of analytics,
time and attendance, talent acquisition, T&D and compensation/payroll. However,
we must take this with a grain of salt, given the fact so many HR professionals
are still neophytes in this area. If your particular HR area is operating smoothly,
there’s no need to go out and purchase the latest AI-powered option. But if your
operations are clunky and inefficient, then it may well be worth seeking out an
AI-powered solution that boosts performance.
4. Leverage AI’s ability to analyze, predict and personalize. These are the features
that HR professionals want to see most in AI-powered HR applications, but
they will help in some HR jobs more than others. Personalization, for example,
is probably most applicable to areas such as learning and development and
career management. Before adopting a new technology, determine what you’d
like to see from it and how well it can deliver. Also, establish the degree to which
the new technology can actually boost performance, as opposed to just
seeming impressive.
used to automate a job or augment employees doing that job? This will become
a more common debate within organizations, and HR should be able to bring a
particular and well-informed point of view to the table.
6. Look for ways to augment employees. AI-based applications have the potential
to dramatically raise the productivity of employees. This is true both within
and outside of the HR function. For example, AIs may help healthcare workers
diagnose patients more easily or aid financial analysts in spotting important
patterns in recent sales data. Although HR professionals can’t possibly keep
up with every AI application in every job category, they can become knowledgeable
internal consultants on the topic of how to boost employee performance via
AI-related technologies and how to estimate potential productivity increases.
7. Investigate how the “AI bosses” will influence employees. As more projects
and workflows are “managed” by AIs, employees will be affected in multiple
ways, from the establishment of new work processes to the development of new
work attitudes. How will this change the need for human contact? Does it increase
or diminish social skills and emotional intelligence? Are some types of employees
more suited for AI-management than others? HR professionals will need to track
these issues and help human managers cope with challenges as they arise.
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