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Understanding the Power of Generative AI for People Analytics – Accelerating HR’s Metamorphosis

The past 3 years have brought about massive change for the working world. Every industry, role, and organization has pivoted more than once. Now, I may be biased, but I’m willing to bet no other function evolved more during this time than Human Resources. From The Great Resignation, to adopting hybrid working models, return to work and more; the seismic shifts (and the buzzwords 😉) were plentiful.  

It’s why we’re seeing the introduction of new roles and titles such as “Chief People Officer”, “HR Data Scientist”, and “Chief Heart Officer” – among others.  

Today, HR grapples with the next stage of its metamorphosis 🦋: embracing Artificial Intelligence (AI).  

While it may be early days for AI and analytics, the potential to radically transform the global workforce as we know it is more tangible than any buzzword that’s come before. In fact (#facts), the latest Mckinsey Global Survey found that Generative AI (gen AI) is already widespread, with one-third of respondents reporting its use in at least one business function. 

As we step into an era dominated by technological advancements, AI emerges as a game changer. It simultaneously holds the potential to revolutionize how businesses perceive and manage their workforce. But there are serious implications to consider, which is why some are hesitant to jump at the chance to add AI tools to their growing tech stack.  

Whether you’ve opted to embrace AI or not – there’s no avoiding it. So, keep reading to learn more about the basic terminology, profound impact, potential pitfalls, and how to ethically adopt AI to drive growth and innovation.  

Understanding AI for People Analytics: Abbreviations Explained. 

While there are many new and emerging terms related to artificial intelligence, we’ll focus primarily on those that are top of mind for HR professionals focused on data analysis. 

Artificial Intelligence (AI): At its core, artificial intelligence refers to systems or machines that mimic human intelligence to perform tasks and can iteratively improve based on the information they collect. AI, in and of itself, is an umbrella term that is used in various ways.  

In an HR function, AI can be used in a variety of ways: automating repetitive tasks, predicting hiring trends, and even offering valuable insights into employee engagement levels.  

Generative AI (GenAI): This is a subset of AI that can create new content from disparate sources and quickly summarize data sets. It produces this content in response to prompts submitted by users. Content could include blogs, headshots, music, or even insights from complex data sets.  

At a basic level, GenAI could write a job description, generate an email response, or produce a recruitment advertisement. On a more complex and impactful scale, we’re even seeing science-backed technology that utilizes feedback loops in GenAI to successfully treat mental illness. There is already such a depth and breadth of applications available for GenAI today, that the possibilities seem endless

From a people analytics perspective, GenAI opens the door for less technical users to be able to talk with their insights. Imagine having a conversation with your own, personal digital assistant?!  

The hope (for many) is to reduce time spent on routine tasks and free up headspace to focus on strategic initiatives that drive the bottom line. 

Artificial General Intelligence (AGI): While fully hypothetical at the moment, AGI will combine the above two. This term refers to AI systems that can mimic human intelligence AND create new content. It’s the type of AI that can essentially do anything a human can do – an all-around AI agent.  🤖 

There’s no shortage of terms related to AI, such as Machine Learning and Deep Learning, and you may already be familiar with this if you’ve been using ChatGPT to generate content. We’ll save those for a future post, though! 

GenAI’s Impact on HR 

The power of AI in transforming HR is immense. While many big names are predicting everything from increased productivity to enabling learning and development, we’re still not certain what the future holds. For now, let’s focus on four key areas:  

1. Freeing up time to increase productivity

2. Streamlining talent acquisition with data-driven insights

3. Improving employee engagement, culture, and retention

4. Deciphering unseen patterns within organizational dynamics 

Freeing up time to increase productivity 

We can all agree on this one, right?  

With multiple AI-enhanced solutions available, we’re poised to automate repetitive tasks that often consume a significant amount of time. Screening resumes, scheduling interviews, and managing paperwork becomes streamlined and effortless. In fact, Boston Consulting Group recently surmised that GenAI (specifically chatbots and automation) can help l increase productivity by up to 30%. 📈 

This automation frees up valuable time and energy for everyone in HR. Imagine what can be accomplished!

Generative AI People Analytics BCG
Source: BCG, “How Generative AI Will Transform HR

Streamlining talent acquisition with data analytics and AI 

AI-powered tools can analyze large volumes of data from various sources like social media, job portals, and professional networks to identify potential candidates. These tools can also help in predicting candidate performance, enhancing the quality of hire, and reducing hiring biases. This leads to a more efficient, effective, and even inclusive recruitment process.  

Improving employee engagement, culture, and retention

This one is really twofold.

One on hand, AI has the potential to redefine employee engagement by providing valuable insights into satisfaction levels through sentiment analysis of employee communications. This level of business intelligence can help HR implement timely interventions and create a culture where employees feel valued and appreciated.

On the other hand, HR Business Partners are now poised to spend more time interacting with employees at the organization on a deeper level. With all of the daily tasks automated, these critical stakeholders will have more time to understand the nuances of manager and employee relationships and make strategic decisions that impact everything from retention to turnover, DEIB and more.

Deciphering unseen patterns within organizational dynamics

By analyzing data on employee performance, turnover rates, and internal surveys, AI can identify issues that may be impacting the workforce. What’s more, AI can help you understand the metrics you should be measuring, by simply talking to your data.

These insights can guide strategic decision-making, from redesigning teams to implementing new policies, all aimed at optimizing organizational dynamics.

Potential Pitfalls 

Rapid technological advancements in recent years have revealed widespread adoption of AI, particularly in Human Resources Management (HRM). But as the old adage goes, “With great power comes great responsibility”. In other words, all this advancement comes with risk. 

We must remain cognizant of the importance of robust governance over AI, particularly in a function so close to employee’s personal data. Ethical considerations, regulatory compliance, and unconscious bias have all come into (understandable) question in recent months.  

Most notably, the EU AI Act now categorizes HR applications as ‘High Risk’, necessitating thorough audits and demanding increased compliance. This aligns with the General Data Protection Regulation (GDPR) concerning the use of personal data and model training. On a broader scale, (like, all of humankind broad), Tech billionaire Elon Musk warns of a “civilizational risk” if corporations and governments can’t band together to proactively regulate AI. 

Corporate legal teams must also navigate complex issues related to AI, including ensuring confidentiality and privacy, upholding fairness, achieving legal compliance, and managing liability. The challenge lies in bridging the gap between the technological possibilities and legal requirements.  

Still, there is no denying that the rise of Artificial Intelligence can make work faster, more accurate, and better for the long haul. To realize this ideal future, though, we need a balanced approach to AI adoption – one that protects individuals, ensures fair practices, and allows for continued growth and innovation. 

Unleashing the power of generative AI in a mindful and ethical way can help HR to fully embrace their data-driven insights. In doing so, HR will be propelled from a supportive role to a strategic business partner, one that steers cultural and organizational growth. The metamorphosis of HR through GenAI is not just an idea for the future – it’s happening right now – and organizations that embrace this shift will undoubtedly reap the benefits.