AI Business Use Case in Human Resource - Administrative Overload

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Introduction

The Human Resources (HR) sector, traditionally encumbered by a myriad of administrative tasks, often grapples with the challenge of administrative overload. This overload not only detracts from the efficiency of HR professionals but also negatively impacts overall organizational performance. The advent of Artificial Intelligence (AI), with its capability to automate routine tasks and provide insightful analytics, emerges as a viable solution to this enduring issue, facilitating a more streamlined and efficient HR operation.

In recent years, especially 2023, AI's relevance in alleviating administrative overload within HR has been significantly highlighted. AI-enabled chatbots, for instance, efficiently handle routine queries from employees and job seekers, aiding in streamlining the recruitment process and other HR functions. Moreover, a variety of AI tools have been developed, capable of automating mundane tasks to advanced data analytics, thereby redefining employee management across organizations. These tools not only automate repetitive tasks, saving time and resources, but also provide a pathway for HR departments to focus on more strategic initiatives.

The broadening use of AI in HR, including recruiting, identifying skills gaps, and analyzing engagement data, has turned HR departments into strategic assets for organizations. Real-world applications of generative AI, like OpenAI's ChatGPT, are being explored for their potential to perform complex tasks, elevating the efficiency and strategic impact of HR functions. This burgeoning integration of AI propels HR towards a more strategic and data-driven function, painting a promising picture for the future of HR management.

###Historical Context

Historically, the Human Resources (HR) domain has been heavily burdened with a range of administrative tasks ranging from recruitment, employee onboarding, benefits administration, compliance management, to record-keeping, among others. The handling of these tasks manually or using basic software tools not only consumed a significant amount of time but also was prone to errors which could potentially lead to compliance issues. Before the advent of AI, Human Resource Information Systems (HRIS) played a crucial role in managing administrative tasks within HR departments. HRIS, being an interface between HR and computer technology, helped in somewhat streamlining HR processes, although it still required substantial manual intervention for data input, analysis, and reporting1. The challenge of information overload was a significant difficulty faced by HR professionals. The vast amount of data generated and managed within HR departments often led to information overload, making it challenging to derive actionable insights and ensure timely completion of administrative tasks2. The need to manage increasing amounts of information with limited resources was a continual challenge, and the manual handling of administrative tasks was often tedious, time-consuming, and susceptible to errors.

AI and automation have brought about a paradigm shift in managing administrative tasks within HR. The introduction of AI-powered systems, tools, and products has significantly outperformed traditional methods, providing enhanced efficiency, accuracy, and the ability to handle complex tasks with minimal human intervention3. Moreover, AI has eased administrative workloads by supporting compliance efforts and enhancing the employee experience through streamlined administrative processes.

Advent of AI

Artificial Intelligence (AI) has emerged as a significant player in alleviating the administrative overload within the Human Resource (HR) domain. Here’s how AI has contributed to overcoming the challenges associated with administrative tasks in HR:

1. Automation of Repetitive Tasks:

AI has proven to be instrumental in automating mundane and repetitive tasks such as data entry, scheduling, and basic employee queries. Automation significantly reduces the time and resources previously required for these tasks, freeing up HR personnel to focus on more strategic and impactful activities.

2. Enhanced Data Analytics:

AI facilitates advanced data analytics, enabling HR departments to derive actionable insights from the vast amount of data they manage. This includes identifying skills gaps, analyzing employee engagement, and even predictive analytics for talent retention and recruitment strategies.

3. Improved Recruitment Processes:

AI-powered tools aid in streamlining the recruitment process by automating candidate sourcing, screening, and initial interactions. This not only accelerates the recruitment timeline but also ensures a more objective and consistent evaluation of candidates.

4. Self-Service Platforms:

AI has enabled the development of self-service platforms where employees can access information and complete basic HR-related tasks independently. This self-service approach alleviates the administrative burden on HR staff and empowers employees.

5. Enhanced Employee Experience:

AI contributes to a better employee experience by providing quick responses to queries and personalized interactions through AI-powered chatbots and virtual assistants.

6. Compliance and Reporting:

AI aids in compliance management by automating the tracking and reporting of compliance-related data. This ensures accuracy and timeliness in compliance reporting, reducing the risk of legal issues.

7. Learning and Development:

AI supports personalized learning and development programs by analyzing individual performance and learning preferences. This leads to more effective upskilling and reskilling initiatives.

8. Resource Optimization:

By automating routine tasks and providing insightful analytics, AI helps in optimal resource allocation, ensuring that HR personnel are utilized in areas where they add the most value.

9. Real-Time Feedback and Performance Management:

AI-powered tools provide real-time feedback and performance analytics, facilitating continuous performance management and employee development.

10. Cost Efficiency:

The automation and efficiency brought about by AI result in cost savings, as fewer resources are required for administrative tasks, and decision-making is enhanced through data-driven insights.

AI's transformative impact extends from mundane task automation to strategic decision-making support, marking a significant stride in overcoming the historical challenges associated with administrative overload in the HR domain. Through continuous advancements in AI technology, the HR domain is poised to become more strategic, efficient, and data-driven, significantly alleviating administrative burdens and driving organizational success.

AI Application to Administrative Overload

1. PitchGrade: This company utilized an AI-powered Applicant Tracking System (ATS) to streamline its HR practices by scanning resumes and identifying suitable candidates for open positions, significantly reducing the time and effort required for sifting through numerous applications.
2. Fig Loans: Fig Loans employed AI to enhance its employee referral system by automating referrals, making it convenient for employees to submit referrals and speeding up the process1.
3. JustEat: JustEat adopted a skills-based hiring approach with the help of HireVue, using AI-powered chatbots for initial candidate screening, which reduced the recruitment time by 50% from 14 to 7 days.
4. A Leading Global Investment Firm: This firm collaborated with Pymetrics to improve diversity in its hiring process using an AI-driven tool, resulting in a 62% boost in female representation and a 9% increase in minority representation.
5. Roadsurfer: Roadsurfer used Zavvy to revamp its onboarding process across eight countries and 36 locations, benefiting from interactive quizzes, personal scorecards, training exercises, and auto-triggered reminders to stay on track.
6. Panasonic North America: Utilizing the Visier People Organization platform, Panasonic transformed its HR management, gaining better insights into employee engagement and learning that productivity improved when employees were encouraged to integrate their work and life.
7. Hypercontext: To foster a remote culture, Hypercontext employed Donut's AI-backed chatbot tool for setting up one-to-one coffee chats between team members, enabling stronger bonds and reinforcing a culture of connection.
8. Financer: The Administrative Manager at Financer shared how they depend on AI for anticipating future hiring needs by analyzing trends in business cycles, employee turnover rates, and growth projections, thus improving their recruitment efficiency

Future Trend

1. Hybrid Work Model

Many companies are adopting a hybrid work model to provide a balanced work environment for their employees, thus reducing administrative burdens regarding workspace management and scheduling.

2. People Analytics

Utilizing AI to analyze employee data to make informed decisions, thus reducing the time spent on manual data analysis.

3. Generative AI

Employing generative AI to enhance HR processes by automating routine tasks, thus significantly reducing administrative overload.

These trends highlight a shift towards a more technologically integrated and data-driven approach in managing HR administrative tasks, which is expected to continue evolving in the near future

Conclusion

As we traverse further into the digital era, the Human Resources (HR) domain continues to evolve, embracing the potent capabilities of Artificial Intelligence (AI) to alleviate the administrative overload. The journey from manual, time-consuming processes to AI-driven, streamlined operations underscores the transformative potential of technology. Real-world cases from diverse companies herald a promising trajectory, where AI not only optimizes administrative tasks but also catalyzes a more strategic, data-centric HR function.

Looking ahead, the fusion of AI with HR processes is poised to redefine the traditional HR landscape. The trends for 2023 underscore a shift towards a more agile, data-driven, and employee-centric HR ecosystem. As AI matures and integrates further, the horizon of possibilities in managing administrative tasks efficiently expands, painting a promising picture for the future of HR management. The narrative of AI empowering HR to transcend administrative hurdles resonates as a testament to the boundless potential of AI in revolutionizing the HR domain.

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