How do businesses use predictive AI in HR?

Predictive AI and HR. It sounds like a futuristic concept, but organizations are using AI technologies as a component of their HR strategy to build and create smarter, advanced workplaces. Predictive AI and HR are turning how organizations think about their employees on its head; they can identify who their best talent is, before the talent even applies. They can also accurately predict employee burnout before it even happens, and much more. But how is this possible? Furthermore, organizations everywhere should be asking, how can they leverage predictive AI and HR to make better decisions, increase engagement, and become a great place to work for every employee. Let’s take a look!

Why is predictive AI important to HR?

Historically, HR has been viewed as a reactive practice. An employee leaves and HR scrambles to replace them. Performance issues occur, and then a review happens. But, what if HR could forecast those future issues without it even happening? That’s where predictive AI and HR come in. AI can analyze massive amounts of employee data to identify patterns and trends. With this predictive analysis, HR teams could shift from reactive to proactive; they can prevent problems before they come to fruition meaning they save time, money, and less headaches. A more engaged workforce – Tailored career paths and training programs. Workforce optimization – Companies that leverage predictive AI and HR effectively experience:

• Lower turnover rates – By predicting resignations before they happen.
• Better hiring decisions – Identifying the best-fit candidates.
• Higher employee engagement – Personalizing career paths and training programs.
• Optimized workforce planning – Ensuring the right people are in the right jobs at the right time.

Now, let’s discuss the art of predictive AI and HR across various HR functions.

Smart, Fast hiring

Hiring is one of the longest and most expensive HR functions. Leveraging predictive AI and HR can shorten this time and improve company outcomes.

• Resume Screening; AI can parse through thousands of applications in mere seconds and targets the top applicants on pre-defined skills and experiences.
• Predict Success; AI doesn’t simply verify qualifications – it predicts the level of success a candidate would have based on previous hiring data, cultural fit, and soft skills.
• Reducing Bias; Bias, human bias, is an inherent challenge with hiring. Predictive AI and HR can reduce bias by making the selection process fair and data-driven.
• Better Search; AI can assess candidate suitability not just for today’s hire, but the potential for long-term employment success in your organization.

For context, companies like Unilever and Hilton use predictive AI and HR tools to analyze video interviews and facial expressions and language patterns to consequently find the best kids – predictive AI and HR allow these companies to identify at a better, faster capability.

Improving employee experience

Improving employee engagement goes beyond providing benefits or perks. It’s about recognizing what employees need and resolving that need quickly before it escalates to disengagement or frustration.

Employee sentiment: AI can analyze internal communication to identify whether employees are disengaged or frustrated—be it e-mails, chat messages, or even surveys.

Personalized development: AI can identify training programs best suited to an employee’s current skills and career ambitions.

Workload adjustment: AI can help disengage employees who are on the verge of burning out, by recalibrating workloads where appropriate. For example, the Watson AI at IBM analyzes employee data to predict whether they will be satisfied in their jobs, and what actions may need to be taken to improve retention rates. The combination of predictive AI and HR results in a workplace that is personalized and engaging, allowing employees to feel confident that they will be valued and acknowledged.

Predicting and reducing turnover

Employee turnover is expensive. Losing a key employee and having to recruit, onboard, and train another, could cost a business thousands per rehire. But what if you could predict a resignation as it is about to occur?

Behavioral tracking: AI can track behavioral signals that may indicate that an employee is about to leave the organization, such as decreased engagement in meetings, decreased productivity, or increased job searches.

Exit risk analysis: AI can look at exit data to analyze risk factors and detect employees who might be thinking about leaving the organization.

Proactive retention programs: Rather than wait for an employee to resign, HR could offer retention incentives and rewards tied to each individual’s value to the organization, including raises, promotions, or mentorships. Credit Suisse is an example of a firm using predictive AI and HR standards to identify employees who may engage in resignation behavior and intervene upstream of the behavior. The result was a reduction in turnover and an increase in job satisfaction.

Performance Management Fueled by AI

Do the same traditional performance reviews every year? That’s a thing of the past. With predictive AI and HR, we can offer continuous, real-time performance management to help employees succeed!

Continuous feedback loop: AI can analyze performance metrics and provide feedback to employees in real-time with actionable feedback.

Skill gap identification: AI allows employees to identify areas of improvement with the learning & dev function to set a targeted training plan.

Objectivity: AI uses data to assess performance eliminates bias and is based on objective information. Example: General Electric (GE) has replaced annual reviews with AI-powered continuous feedback systems resulting in performance improvements and higher employee engagement.

Workforce planning & forecasting

Planning for the future has never been easier! With predictive AI & HR, organizations are using AI to:

Identify hiring needs: AI can predict future job openings based on the organization’s predicted growth.

Analyze workforce trends: AI supports HR to understand which different roles will be anticipated in the coming years.

Optimize team structure: AI can also recommend the best composition of team members to work together for a specific project. Example: Google uses AI-powered analytics to determine and predict how many employees to plan in each department based on the organization’s historical work trend.

Employee well-being & mental health

Employee well-being is not just some buzzword, it’s a priority of business. Predictive AI and HR tools can assist HR teams to:

• Identify when employees are showing early warning signs of stress or burnout.
• Suggest personalized wellness programs.
• Ensure fair workload distribution. By integrating predictive AI and HR, companies are ensuring that their employees stay healthy, engaged, and productive.

Common mistakes in predictive AI and HR

Even the best AI-empowered HR tools can fail if the implementation is not done right. These are some common traps about AI data:

• Relying only on AI: AI is a tool, not a decision-maker. Humans are still necessary to oversee everything.
•  Disregarding employee privacy: Failing to properly use the data could lead to legal issues and major issues with losing the trust of the employee.
•  One size fits all: AI models need to be constructed for each company. Companies that trust predictive AI and HR integrate that technology while ensuring that AI is used to enhance human judgment, not replace it.

What is happening next for predictive AI and HR?

The future of predictive AI and HR is bright, with several important new trends influencing the workplace:  

• Hyper-personalized HR experiences – AI will give even greater career and learning suggestions uniquely tailored to the needs of individual employees.  
• AI-HR collaborations – AI will work to support and augment HR decision-making; not replace it.  
• Responsible AI – Companies will learn and work to develop HR experiences that are clear and fair AI and are responsible for using technology. 

Predictive AI and HR will put employers using it ahead of the talent employee raise and harness the true value of the talent, employee engagement, and employee performance.

Final Thoughts

At the end of the day, predictive AI and HR are talking about improving work for people in general.  AI will allow companies to be better at hiring smarter, retaining talent, and engaging people while workforce planning optimizes their work experience while enhancing employee wellness.  If your company hasn’t taken the positive leap to use predictive AI and HR now is the time. The future of HR is not all about managing people; it’s about understanding them. 

UNLEASH will strive to provide you with updates on HR technology, AI, and work trends to keep you informed. Stay tuned for the next updates on how AI is transforming HR for the better!