HR Is Already Behind in the AI Revolution. Here’s How to Take the Lead

BY the Editors | November 16, 2023

Most HR leaders didn’t go into their field because of their love of technology. Their affinity is more about seeing people reach their potential in the workplace. Yet now comes a transformative revolution in which they’d be best advised to embrace both. And do it soon. 

It was only a year ago, when OpenAI launched ChatGPT 3.5, that generative AI burst into the public consciousness. Within two months of its release, it had 100 million users, ranking it as the fastest-growing consumer software application in history. Tapping its uncanny cognitive capabilities, people began using it to compose songs, draft emails, plan parties, write software, and conduct myriad experiments. 

Yet in the HR world, most professionals have taken a guarded approach, one that could prove detrimental to their businesses given the speed and potential of AI’s transformative impact, according to a global study that surveyed 1,522 professionals in HR and related fields across 62 countries. Conducted by the Institute for Corporate Productivity (i4cp), the study concluded that because of “HR’s purview of workforce capabilities, skills, potentials and deficiencies, this is a strategic miss that needs to change if organizations expect to truly leverage AI,” wrote Kevin Oakes, CEO of i4cp, in his foreword to the report, titled “Is HR Already Behind in the AI Revolution?” His answer to the titular question is yes­, followed by a detailed assessment of the situation and recommendations for how HR can take a leading role. (An executive brief is available here.)

As part of the survey, i4cp interviewed HR pleaders, many of whom testified to the benefits that are already apparent for those who have embraced AI early. “As an HR professional if you’re not digging into this space, then you’re already behind. It’ll change the way we do so many things,” said Cameron Hedrick, chief learning officer at Citi. 

An executive summary of i4cp’s new report can be obtained here.

In the years since the pandemic, repeated crises have heightened the influence of HR leaders in their organizations. The arrival of generative AI is the next disruption, one in which HR profession could take a leading role at the decision table. “We’ve always said we want HR to be more strategic partners with the business,” said Dalia Kendik, head of digital HR for Thomson Reuters, the news and information giant. “There’s a lot of opportunity for generative AI to improve the employee experience and HR needs to be an advocate for the rest of the organization.”

Approaching Generative AI: Three Organizational Types

Based on its survey, i4cp identified three archetypes to describe how organizations are approaching AI, which it calls the Generative AI Maturity Model:

AI Laggards, where leaders have not communicated clear guidance on usage and have no formal usage policy.

AI Enquirers, where leaders are researching potential uses but are largely in wait-and-see mode. They’ve likely told employees to refrain from using AI until there’s more evidence of how other organizations have used it.

AI Innovators, whose leaders have communicated their support of AI usage and experimentation, and likely have put formal usage parameters in place.

To evaluate these organizations, i4cp described nine AI Innovator practices that every organization should follow if they hope to stay current with the revolution. These practices range from openly communicating about generative AI to reduce fear and uncertainty in the workforce to providing a secure environment for workers to experiment with generative AI. The survey found a striking gap in engagement between AI Innovators, who on average have put into place 77% of those nine practices (or are planning to adopt them), the AI Enquirers, who have embraced just 13%, and the AI Laggards, who are at fewer than 1% of those practices. 

The difference can be huge for organizations who take the innovative path, the study forecasts: “AI Innovators lead when implementing these practices compared to others. Their gap-creating lead can be cataclysmic for those lagging in the number of practices they are planning to implement or have implemented.”

How AI Innovators Can Create a Competitive Advantage

Organizations who wait to embrace generative AI will face a huge opportunity cost. Here’s what they’ll miss: “Organizations that are the most advanced in AI applications (the AI Innovators) are more likely to have higher market performance, increased innovation and productivity, and healthier cultures than those that are slow to adopt,” the i4cp report asserts. 

To illustrate these points, the report offers several case studies of organizations that have acted quickly to apply generative AI to their processes. Felix Martinez, senior director of talent acquisition at General Electric Appliances, describes how TA leaders at his GE division are using an internal platform similar to ChatGPT to draft individualized recruiting messages to potential candidates. “Best practice is you send 10 emails and get four responses—that’s best in class,” Martinez said. “Our ChatGPT-crafted emails are generating 70% to 90% response rates. Now we’re able to reach individuals in a more compelling way and they’re responding at a higher rate, which affects time-to-fill and quality-of-hire.” 

The mandate to be innovative comes from the top, Martinez said. “We’re very fortunate to have a CEO who is leading the way,” he said, speaking of Kevin Nolan, CEO of GE Appliance.

“He gave us a task where anyone could come up with any idea to use AI to solve for business problems. There were 300 submissions. And our CHRO is challenging us in HR—how can we use this and how can we get in front of it? If you don’t learn how it can impact you, you are going to be left behind." 

For Leaders, What You Don’t Know Can Hurt You

Besides the risk of missed opportunities, an overly cautious approach to generative AI has other dangers, some of which could strike quickly. In organizations where management have explicitly forbidden employees from using AI for work, 36% are certain their employees are doing so anyway, and another 36% say it is highly likely, according to the i4cp survey.

In such cases, companies can increased the hazard of data leakage. “Exposing company information often happens unintentionally when employees copy and paste proprietary or sensitive data, such as a source code, into publicly available models like ChatGPT,” the reported noted. AI Innovators are more likely than their laggard peers, for example, to have data security and ethics policies, as well as requiring fact-checking and citations when AI is used.

Another risk is bias in the system. “Since generative AI models are trained on content created by humans, it can perpetuate human biases at scale,” the report said. Such bias can not only undermine an organization’s commitment to diversity, equity, and inclusion (DEI), but can also run afoul of the need to comply with new regulations among, local, state, and federal governments about how organizations use AI in candidate selection, hiring, and promotion.

There’s Almost No Area of HR That AI Won’t Change

The list of tasks for which AI can be useful starts with the mundane (searching information, data cleaning) and rises to much more strategic levels. Today, HR professionals in the survey said they’re using generative AI in learning and development (58%), people analytics (57%), talent acquisition (54%), employee experience (46%), and leadership development (45%). Many AI Innovators say they plan to use it next in such areas as workforce planning, succession, labor scheduling, and performance management.

To help organizations be on the forward-looking side of the AI revolution, the report makes four recommendations: Be prepared to lead strategic discussions about the workforce implications of generative AI; proactively prepare HR with the necessary skills for the AI revolution; approach generative AI as a systems enabler, not just a personal productivity tool; and create a change-ready culture.

Already, HR leaders who have taken these steps on the journey start seeing exciting prospects down the road. At Sysco, the world’s largest foodservice distributor, the company expects to use the technology to make end-to-end HR processes more efficient, for example, by matching employees in need of specific skills with internal “gig” opportunities to help them advance. 

“Those are huge opportunities for us, and they are just some of the use cases,” said Michael Fischer, Sysco’s VP of global talent management. “You’ve got transactional work, then you’ve got really meaningful work around career development and around colleague development. We know it’s the future and we also know it’s early days. We are going to invest in this. But we want to be very thoughtful about it as we continue because it is changing so fast.” 

Editor’s note: From Day One thanks its partner, i4cp, for sponsoring this story. An executive summary of its new report can be obtained here. (Feature illustration by Quoya/iStock by Getty Images)

RELATED STORIES

Navigating the Future of Business With Resilience and Innovation

When Amy Letke, national practice leader, HR consulting at Marsh McLennan Agency talks about innovative HR strategy, she points to one of her clients as a perfect example. This company has a workplace with harsh conditions that most of us would find unattractive. It’s a meatpacking company where employees often find themselves working in below-freezing temperatures and less-than-competitive pay. Yet its attrition rate is remarkably low.The client told her, “We’ve invested in our people, we’ve conducted leadership training, we’ve had to reorganize. We’ve [also] had to go back to our leaders and say, ‘You’ve got to like your people, to talk to them, and be compassionate to their needs.’” Letke shared this story in a thought leadership spotlight at From Day One’s D.C. event. By offering a holistic benefits package and engaging not just the employees, but also their families with a welcoming company culture, this organization convinced workers not only to stay, but to thrive in a very tough job.In a dynamic business environment, adaptation is essential to stay competitive. Organizations face unprecedented challenges and opportunities, demanding a blend of resilience and innovation. Letke offered an enlightening presentation on how to navigate and excel in this landscape, with insights, strategies, and actionable advice to thrive amid evolving industry trends.Workplace Challenges in 2024Letke says employers face three major challenges this year, each of which offers opportunities to be more effective with your HR benefits strategy. First, is attracting and retaining talent. The second, she says, is getting more done with less. And finally, the third is the rapid technological advancement happening.Covid prepared HR teams to deal with rapidly changing circumstances, she says. “HR teams have to be resilient. And we always are renewing and invigorating ourselves.” She offers several hallmarks of a resilient HR structure, including a coaching for leaders, a handbook that addresses time off and other work policies, up-to-date job descriptions, and a readiness to handle tough conversations, among others. By consistently analyzing your infrastructure and making sure the latest trends and policies are incorporated, you can stay ahead of any challenges coming down the line.Creating an Effective StrategyIn addition to staying on top of trends and keeping HR infrastructure updated, it’s also about attitude and company culture. “When we become a leader, we’ve got to realize what we’re signing up for,” Letke said. “It means we have to be compassionate, caring, [and] we have to listen.” This sometimes requires training, she says.Amy Letke,  National Practice Leader, HR Consulting at Marsh McLennan Agency led the thought leadership spotlight in D.C.Resilient infrastructure can create a resilient culture with exceptional supervisors. These leaders give the frontline workforce the support that they need and can often make an organization more attractive even when the pay is not as competitive due to budget cuts in a challenging economy. It also means that leaders should be held accountable for employee turnover, as their attitude and care should be driving the culture that inspires retention and loyalty.Workers satisfied with every element of the employee experience are happier and feel more successful, appreciated, and have a greater sense of belonging, Letke says. These elements include pay and compensation, purposeful work, culture, and flexibility. “This list shows how we as leaders can deliver care throughout our organization,” Letke said, and should be a guiding principle behind HR strategy.Having an Effective Benefits Strategy“Offering good employee benefits is just basic, everybody expects it,” Letke said, especially post-pandemic. So she encourages leaders to be more creative with their benefits strategy in order to stay competitive. A recent Marsh McLennan study showed that one in three employees would forgo a pay increase in return for additional well-being offerings for themselves and their families. “Being able to support your employees’ well-being is something we are seeing as an emerging trend, so thinking about those benefits is a way you can differentiate your company from others,” she said.Letke identifies four key areas of focus as opportunities to be more effective with your benefits strategy:Personalization: Give employees choices.Segmentation: Understand the different segments of employees and their needs. Centralization: To curb spending, there will likely be a centralization of tech platforms and human support options for HR teams. Empathy: Be there for your employees.A comprehensive benefits program incorporates the needs of every generation in the workforce, whose needs can look quite different. For example, Gen X might want remote work, flexible scheduling, caregiving benefits, and retirement planning, while Gen Z might prioritize student loan repayment, financial planning assistance, and training and development.Many workplaces have multiple generations represented among the workforce, so “managing to the needs of these generations is critical,” Letke said.Ultimately, HR success is about cultivating a mindset of innovation, Letke says. If HR has become a “check the box” compliance function, you’re doing it wrong. “Our job is to lead, inspire, and help others understand the impact they can make on the employee experience,” Letke said.Intention, compassion, and empathy is how winning organizations do it. A holistic approach to leadership that includes every element of an employees’ experience – both at work and at home – can make for a sustainable, forward-thinking, and highly attractive workplace.Editor's note: From Day One thanks our partner, Marsh McLennan Agency, for sponsoring this thought leadership spotlight. Katie Chambers is a freelance writer and award-winning communications executive with a lifelong commitment to supporting artists and advocating for inclusion. Her work has been seen in HuffPost and several printed essay collections, among others, and she has appeared on Cheddar News, iWomanTV, and CBS New York.

Katie Chambers | May 09, 2024

How to Keep a Hybrid Workforce Engaged and Productive

As of February 2024, more than half (54%) of employees in the US who can work remotely adhere to a hybrid schedule, and 27% are exclusively remote, according to data from Gallup.Yet many employers remain suspicious of remote and hybrid arrangements, fearing lack of productivity, weakening engagement, sagging performance, and lost opportunities for employee collaboration and innovation. Hoping to understand employee movements outside of their offices, some employers have invested in employee-monitoring software, capturing everything from hours worked to keystrokes.Yet privacy is a major concern for workers, and invasive employee monitoring can feel like Big Brother is breathing down their necks, rupturing trust and putting workers on guard.“It’s really important that we think about [employee productivity] insights not as a mechanism to scratch an itch of curiosity, but a mechanism to provide continuous improvement as it relates to the way that we work together,” said Gabriela Mauch, head of the productivity lab at workforce analytics software platform ActivTrak.Mauch understands why the itch is there. “This conversation started three or four years ago when [companies] abruptly transitioned from being a fully in-office organization to a fully remote organization,” said Mauch. “So many of us felt the pain of lacking visibility into the time worked and schedule adherence that are critical to running the business.”Yet many employers are asking the wrong questions, misinterpreting data, and failing to trust their workers to spend their time efficiently. During a recent From Day One webinar on engaging a hybrid workforce, Mauch and her colleague Sarah Altemus, ActivTrak’s productivity lab manager, talked about how employers can better and–more responsibly–use employee productivity data.Speakers from ActivTrak discussed the topic "How to Get Hybrid Right: The Cornerstones of Success" (photo by From Day One)Employers are susceptible to misuse of employee productivity data, and not just because they may want to obsessively monitor every click of a worker’s mouse.There is plenty of room for misinterpretation. For example, working long hours doesn’t mean someone is more productive or engaged, it could mean that they’re overloaded or barreling toward burnout. Likewise, a light schedule may not indicate laziness or disengagement, it may be a sign of underutilization. “These can quickly become attrition risks,” said Altemus.This has been a common struggle for employers, according to Mauch. “While we maybe had clear expectations of how we expect people to work, what we managed to struggle with is whether people are working too much or disengaging.”So some employers have responded by grabbing at details they hoped would illuminate those patterns. But a closer look doesn’t always make things clearer, and good information can get buried in the minutia of massive data reports. Shrewd interpretation of data at a higher level provides a more accurate picture. “The right information can help your managers act as coaches and provide guidance without infringing upon the comfort of your workforce who want to make sure that they still have those critical levels of privacy,” said Mauch.Altemus encouraged employers to examine productivity data at a higher level, in the form of general activity logs. “Think of it as just a glance around the office that you would otherwise get if you were in person,” she said. “How many employees are working today? How are productive hours tracking relative to goals? Is engagement and productivity trending up or down? Are there teams that are at risk of burnout, disengagement, or misalignment?”Better information can help managers categorize working time as productive or unproductive and make sure workers are actually signing off from work at the end of the day–not burning the midnight oil until they burn out. It can help managers avoid proximity bias that favors in-office workers over remote or hybrid workers for promotions and raises. And it can help leaders make the most of face-to-face time and office reconfigurations.To this end, Altemus recommended clear expectations. “The success of a flexible workforce requires clearly delineated responsibilities and communication protocols,” she said. And it needs a performance management strategy.Employers don’t set arbitrary guidelines for guidelines’ sake, said Mauch. “At the end of the day, the intent of company policy is not just to ensure that people are following it, the intent of the policy is to optimize productivity, take care of your employees, and retain them.”That’s when activity reporting becomes invaluable, she said: When you stop trying to answer the question, “Did people badge in and did people badge out?” and instead answer “Does my hybrid policy fully maximize my ability to engage and reach my productivity goals?”Editor's note: From Day One thanks our partner, ActivTrak, for sponsoring this webinar. Emily McCrary-Ruiz-Esparza is a freelance journalist and From Day One contributing editor who writes about work, the job market, and women’s experiences in the workplace. Her work has appeared in the Economist, the BBC, The Washington Post, Quartz, Fast Company, and Digiday’s Worklife.

Emily McCrary-Ruiz-Esparza | May 01, 2024

Why College Prep for Teens May Become the Next Workplace Benefit

Employers offer a wide variety of benefits for the working parents of young children, from onsite childcare and paid leave to fertility and conception benefits, but what about support for parents of older children and teens? During the teen years, “There's a massive emotional strain between parents and teenagers that folks are way too familiar with. There's financial uncertainty,” said Jonathan Murray, head of Empowerly for Employers. And “college prep is a major source of stress for these parents and has a significant impact on workplace productivity.”Murray ticked off some compelling statistics from a survey of 1,000 working parents that Empowerly commissioned to explore the value of an employee benefit for college prep. A full 95% reported that they are nervous about their teen's future when it comes to college prep. Fifty percent of them said that college prep was a constant stress and 88% of the 1,000 parents said that they use time at work to help their teens with college prep. One in four of these parents admit to using from six to 15 hours a week.“It’s not surprising that parents are looking to employers to provide help, and looking to employers to provide college prep benefits,” said Murray. “It's the number two benefit that was requested by parents of teens,” after financial well-being, he said.I interviewed Murray and Theresa Shropshire, an enrollment expert and college consultant for Empowerly, about the compelling reasons for employers to support their workforce during these critical years in a From Day One webinar titled, How Employers Can Ensure Continuity of Care for All Families.As a working parent of a teen who just went through this process, I can attest that the high school years and the college prep and application process are unlike what I experienced myself as a teen college aspirant. The competition and pressure for teens to perform at a high level academically, athletically and even socially is astonishing. The private college counseling industry has boomed as overwhelmed parents seek to navigate these unfamiliar demands.Shropshire described the types of services college prep companies such as Empowerly now offer, which range from the familiar, such as helping students craft compelling college application essays, to the less well-known, such as helping students choose everything from courses, extracurricular activities, and selective summer programs beginning as early as eighth grade. “A lot of the parents that I speak with are actually first generation in the U.S. Or maybe they went to college outside of the U.S. The process here is very, very different. It’s not all about grades and test scores.”Journalist Jeanhee Kim interviewed Jonathan Murray and Theresa Shropshire of Empowerly during the From Day One webinar (photo by From Day One)Many of the services save parents’ decision-making time, such as counseling parents and teens on how and when to take advantage of early action, early decision, and regular decision college application options as well as evaluating and comparing costs and financial aid packages when a fortunate student is deciding among multiple college acceptances.While college prep is an emerging employee benefit, Murray described how the realization that teens need more support is beginning to permeate society. He pointed to the recent partnership between New York City and TalkSpace, the mental health app, to deliver free mental health care to teens from age 13 to 17.“It really hits to the heart of what benefits are truly for,” said Murray. “They’re the ability for an employer to step in and help their individual employees or their employee families with these large problems that impact them, impact their families, impact the organization, and impact the communities.”College prep services like Empowerly not only help teens, Murray says. “There’s benefits for the parents, and then downstream, that benefits employers and communities.”There are different options for employers as well, says Murray. He described tiers of benefits that begin at no cost to either the employee or employer. Empowerly would partner with employers to offer no-cost access to college prep resource materials, such as samples of successful college essays. Options then level up to one-on-one consulting between the employee and college prep service at a cost that could be borne directly by the employee or by the employer.He emphasized that Empowerly would work with employers to craft plans that satisfy the employers and provide real benefits to employees. “We can provide ROI on it. It’s just so highly bespoke based on the needs.”Editor's note: From Day One thanks our partner, Empowerly, for sponsoring this webinar. Jeanhee Kim is an independent journalist who has worked for CoinDesk, Crain’s New York Business, Money magazine and Forbes Asia.

Jeanhee Kim | April 30, 2024