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Over the past four years, the identity of human resources has shifted from that of a back-office compliance center to a department focused on productivity enablement and employee experience. While the mass move to remote work and the Great Resignation of American employees first catalyzed that shift, the adoption of artificial intelligence technologies will see it fully come to fruition.
In 451 Research's Employee Life Cycle & HR 2024 survey, HR professionals shared their top AI use cases. The results point to a human resources function focused on maintaining its legacy outcomes while helping improve employee performance and recruitment.
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The accessibility of AI technologies has never been greater, and departments like HR are reaping the benefits. As HR practitioners have become more familiar with AI technologies, vendors in the space have begun baking them into their offerings and releasing GenAI tools, further easing the friction of adoption. This undoubtedly relieves some of the burden of manual tasks and can improve HR processes (the second-highest strategic focus according to our HR survey respondents).
However, its use also creates governance and compliance challenges. Complying with new laws and standards around the use of AI is the most important strategic focus HR expects over the next two years (38%), according to our survey. If the compliance issues can be adequately mitigated, HR can benefit from the technology across its core responsibilities, including driving employee productivity and engagement, improving recruitment efforts and standardizing employee data. These use cases highlight how AI can help HR deliver on its legacy goals (employee records management, writing job descriptions), in addition to more quickly adding value to talent-acquisition goals and gaining a deeper understanding of the employee experience HR is creating.
Context
We asked HR professionals currently using AI what their top use cases are for the technology. As illustrated below, the top five use cases fall into three categories: employee experience (especially productivity and engagement), recruitment and legacy HR information management.
Below, we discuss these use cases and examine how they align with a modern HR department's goals in the organization and how certain vendors are supporting these cases.
Employee performance monitoring and analysis
In the early days of the COVID-19 pandemic, monitoring software was sometimes used to ensure newly remote employees were seated at their PCs from 9-5 or clicking enough in a certain software. This kind of tracking, referred to as "bossware," has a variety of pitfalls that must be addressed. It is likely not the kind of performance monitoring that could benefit from AI-powered trend analysis. Instead, modern performance monitoring and analysis tools seek to provide insight into what tools are being used by top performers, what teams are generating what outcomes, which meetings are a waste of time, and more.
This use case aligns with one of HR's top primary roles selected in our survey, which is to "provide employees with the tools and environment they need to excel in their role (44%)." We refer to this as work execution culture, and it is a key aspect of the digital employee experience as a means of attracting new talent and retaining existing employees.
The use of these tools is broad. Sapience, for example, uses intelligence to help companies manage workforce capacity and cost across enterprise and contingent workforces. ActivTrak looks at workforce productivity, resource usage, distraction analysis and workforce planning. Other vendors, like we360.ai, intelligently monitor the workforce to improve productivity and keep projects on task.
Even some observability vendors have shifted in this direction, with firms like Nexthink and its Application Experience seeking to improve productivity by identifying friction points in endpoints, or analyzing user behavior within an application or sentiment about a certain tool. Riverbed offers a similar product in its Aternity End User Experience Monitoring product, which looks at productivity and the employee experience within apps.
Generating job descriptions and contracts
GenAI can quickly generate content based on a large corpus of related media. For HR, this typically means using the technology to create job descriptions and employee contracts, with 44% of HR respondents listing this as a current AI use case. The top way respondents said skill set requirements for HR professionals changed in their industry over the past three years was with a "stronger focus on winning the war for talent (50%)." GenAI offers a way to accelerate tedious tasks associated with recruitment and hiring.
Beyond the simple generation of content, many GenAI tools allow users to set parameters for the content to combat bias and bolster diversity, equity and inclusion efforts. Other GenAI tools can generate job descriptions based on certain requirements that align with the details of candidates the organization has had success with in the past. Talent intelligence platform provider Phenom comes to mind with its X+ offering, which can create bias-free job descriptions, write interview questions for managers and generate brand content for job sites.
Large human capital management (HCM) vendors have also looked to GenAI for job description creation. SAP Successfactors partnered with Microsoft Corp. to use its Azure OpenAI Service API and its own data to generate job descriptions. Oracle Corp. added generative AI functionality to its Fusion Cloud HCM, with one of the purported use cases being job description authoring. Workable and Genai Works both have AI tools for generating job descriptions.
Employee record management
One of the long-standing roles of HR is to collect, organize and manage employee records. This can be time-consuming and difficult, given the level of detail involved and compliance concerns associated with personally identifiable information. As such, it stands to reason that 38% of HR professionals would be looking to AI tools to help them manage these records.
In addition to enhancing efficiency through automation, AI can boost search and retrieval capabilities, assist in data governance and compliance, and help HR be better prepared for potential audits. This is where AI can really help improve HR processes. Automated employee document management from Leena AI helps HR collect and manage employee records and documents on a secure and compliant platform, while tools like Pipefy's HR Service Delivery centralize employee information to be used with an AI assistant.
On the pure record-keeping side, content management vendors like Hyland and Access have both touted their use of AI to optimize record-keeping efforts. Box Inc. also has an employee records management solution with intelligent detail extraction and automatic metadata generation.
Matching candidates to open roles
As HR grows its skill set and proficiency in recruitment, another major use case for AI has become matching job candidates to open roles at an organization (38%). It is a feature that could impact buying decisions as well, given 42% of HR pros say the availability of intelligence and automation (intelligent assessments, matching) is a missing feature they would like to see added to the candidate recruitment software used by their organization.
Talent intelligence platform vendor Eightfold has long used AI to match candidates to open roles at an organization, as well as offer intelligent skills planning and options for contract workers. Candidate relationship manager hireEZ offers AI-powered candidate matching, while sourcing software like Fetcher uses AI to seek out candidates that are a good match for a role. Paradox AI, SeekOut, Zoho and Jobvite also all leverage AI in the candidate search and matching processes.
Analyzing employee engagement and attrition risk
Following the mass exodus of employees in the Great Resignation, companies began looking for ways to understand the engagement of their workers and identify employees that may be at risk of leaving, to mitigate the departure or plan for its impact. In our survey, HR pros said their top role is to "keep employees engaged and build a supportive company culture (46%)," so it makes sense that they are throwing AI at the problem to solve it.
Vendors including Akkio and HRbrain offer AI employee churn analysis tools, while employee apps like Blink use AI to track engagement levels over time and understand turnover risks. The popularity of tools in this area has spurred M&A activity as well, with people analytics vendor Visier acquiring employee burnout and attrition risk prediction analysis vendor Yva.ai in May 2022, according to the 451 Research M&A KnowledgeBase.
This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.