The HR Tech Revolution: Supercharged by Generative AI

Picture a scenario where HR professionals are equipped with AI-powered assistants to significantly simplify recruitment processes, imagine a situation where recruiters no longer have to write job requirements. Imagine AI assistants serving as career mentors, guiding candidates through their professional development journey.

This is the future of HR, and the future is here!
This episode of Hireside chats explores the fascinating world of Generative AI and its impact on HR and recruitment with SatJ and Sriram Iyer, CEO of HR Tech. Sriram Iyer is the founder and CEO of HR Tech, a firm with a vision to empower HR teams to embrace data-driven and tech-savvy approaches. Sriram will share his perspectives on the power of harnessing generative AI to transform talent management. The duo also talks about how HR professionals must be ready for the inevitable future where work and the worker are augmented by artificial intelligence.

Episode Highlights

  • Generative AI is reshaping HR, with over 50% of the working population already using it in some form or the other. Generative AI has the power to transform the very foundation of recruitment. 
  • Generative AI is all about the ability to generate new content with simple prompts in a matter of a few seconds and has opened up a broad user base beyond the tech community. The disruptive power of generative AI is putting AI in the hands of every user out there!
  • With the large populations and lag in tech adoption, Asia will be the future for HR technology!
  • The integration of generative AI into HR processes has the ability to transform employee and candidate experience significantly.
  • HR has evolved to a process that is personalized around employee experiences. And modern HR professionals must be ready for the future where work and the worker are augmented by artificial intelligence.
  • The future of HR is intertwined with generative AI, and there is no substitute for the human element, especially in a field as people-centric as HR. It’s important to remember to use Generative AI to augment human capabilities, not replace them. 

Read the blog version of this engaging conversation on the topic that has taken the world by storm, with plenty of practical takeaways to better prepare for the future of work. 

Hireside Chats Episode 9: The HR Tech Revolution: Supercharged by Generative AI

SatJ: As technology advances at an unprecedented pace and HR professionals are faced with new challenges and opportunities, there’s been so much buzz in the recent months about generative AI, and people seem to be shifting between wonder at the potential of these tools and fear of the risks that come with it. So why don’t we just start off with what, according to you, is so different about generative AI, and what do you think is behind all of this disruptive potential?

Sriram: Traditionally, AI was a very mysterious, obscure technology for most of us, especially the HR teams. It was in the traditional realm of data engineers, data scientists, and experts who completely understood AI, ML, and deep learning. But generative AI is all about the ability to generate new content with simple prompts in a matter of a few seconds, and that’s opened up a broad user base beyond the tech community. In traditional programming, you would define the rules, and AI would execute the same, but with recent developments in NLP and large language models, they can easily respond to human language and provide you with content, ideas, and various relevant inputs without knowing to code. And that, I think, is the disruptive power of generative AI— putting AI right in the hands of every user out there!

SatJ: In today’s digital world, traditional office-based HR is becoming less relevant, and to survive, human resources teams need to get on board with HR tech and generative AI to streamline processes, enhance creativity and provide better candidate experiences. Your organization and you have been doing some remarkable work in this space. Tell us, why is there so much buzz around the HR technology area, especially in Asia, according to you?

Sriram: We’ve always traditionally bet more on the Asia Pacific and the Middle East region because the opportunity for growth is really significant here. Initially, Asia lagged behind the Western world in terms of tech adoption. So there is immense opportunity for growth. Take India for example; it leapfrogged from 2G, 3G to 5G much faster than the Western world. And that’s exactly what will happen in the world of HR tech. The HR teams in Asia Pacific have been lagging behind in technology adoption, and that’s where we see a lot of potential. Also, over 50% of the global workforce is in Asia, based on population, especially split between China, India, and Indonesia.

So the opportunity for future transformation will be right here in the Asia Pacific. The other key element that we see is with remote teams, with virtual and hybrid teams spread across multiple geographies— the HR processes are becoming really complex. There are different legislations and different labour laws, and all of this is contributing to the necessary adoption of tech by HR teams.

What is also happening is the CEOs traditionally had a different lens while looking at the HR teams. But now they are under immense pressure on cost optimization and productivity, HR teams are no longer spared. So HR teams, too, have started talking tech and data, which is again adding to the entire pressure to adopt technology.

But what I think is the big reason why Asia is going to be the hub for HR technology is that the cost of product development in Asia is really insignificant when you compare it to the cost of product development in the Western world. And that is why you’re seeing unicorns. Last year alone, we had 22 unicorns from India, with many more HR tech unicorns coming. Apart from Darwinbox, we haven’t had too many HR tech unicorns, but I think Darwinbox is the beginning of a long line of unicorns that we’ll see in the HR tech space from Asia. 

So the cost of innovation and cost of product development being insignificant in Asia is going to drive the onslaught of more HR tech product companies from the Asia Pacific. All of these are multiple aspects, a complex HR process, a growing workforce, increasing HR complexity, mobile internet penetration, and finally, the cost of innovation and product development is insignificant. All of this is collectively ensuring that Asia will be the future hub for HR technology.

SatJ: HR function and the people in HR have always been labeled traditionalists, considering that the function is a touch-and-feel function. So do you really think generative AI will completely alter recruiting as we know it? And what specific HR processes or functions do you believe will benefit the most implementation of generative AI? And it will help if you can give us some examples that you have come across dealing with a lot of these HR start-ups in your tech platform.

Sriram: I have had the opportunity to actually view a lot of demos over the past three months from various HR tech providers in the Asia Pacific on how they have been leveraging generative AI and ChatGPT into their product capabilities. The kind of opportunities that we are seeing that are going to come up is really mind-blowing. I’ll give you some specific examples— I’ve had the opportunity to see Ripplehire and Xobin, a lot of the product providers from India who are essentially bringing in these technologies. Here are some specific examples. 

Number one, when the hiring managers give us mandates, there is no job description, there is no specification. Just a one-liner mandate. And we can’t go to a candidate with a one-liner job description. But now we have chatGPT. We can essentially make any applicant tracking system recruitment automation software more sophisticated at the click of a button. You just input some basic details; it can churn out detailed job descriptions, not just detailed job descriptions, but descriptions adherent to diversity, equity, inclusivity, and belonging.

Next Imagine assessments, earlier when we looked at assessments, the product providers struggled with a database of thousand standard questions, and the same questions were administered to all the candidates. Now, with adaptive assessments, every candidate, based on the questions that they answer, gets questions thrown at them in a higher order based on their ability to answer the initial questions. This improves the entire prospect of identifying the right fit candidate rather than just administering the same set of questions to everyone. 

Number three, companies today are struggling with offering acceptance from candidates. I have seen some crazy software that can actually customize videos from the CEO of an organization to every single candidate coming on board. That is mass personalization, now completely possible with chatGPT. 

Onboarding, during the pandemic, was a mess. Imagine having a virtual buddy or a virtual assistant that can cater to every single new joiner that comes into the organization, making onboarding as seamless as possible. Be it candidate engagement, assessments, offer acceptance, or onboarding. It’s a nightmare for recruiters to speak to 60-70 candidates daily, screening them and answering all their queries. Now I can have a generative AI-enabled bot that can speak to all these candidates on a call or on WhatsApp, seamlessly automating the entire process. So, generative AI has really made the job of your recruiter much simpler.

SatJ: How can you personalize employee experience using generative AI? In your experience, how have organizations used HR technology to enhance employee experiences? One is to create a great experience for people, candidates who are coming into the organization, but for their own employees— have they used generative AI effectively to enhance their experience? Any examples that you can quote?

Sriram: The first step in the entire process is strategic workforce planning. In my personal opinion, the mess that we are seeing right now with layoffs, etc., is happening because somewhere, HR and business teams are not aligned in terms of workforce planning, and that has led to this entire aspect. Today generative AI or ChatGPT can help identify skills gaps. They can go through the job descriptions, resumes, employee profiles, and compare the required skills with the available skills, identify areas where the specific candidate is lacking, and suggest ways to bridge the gaps.

Another element is Workforce forecasting, generative AI can analyze big data, industry trends, and market reports, can identify how your competitors are hiring globally, who your competitors are hiring within the single market, what kind of skill sets you have within the organization right now, and what kind of skill sets do you need to hire in the next three to five years? It can do all of these and provide you with future workforce needs predicted to the closest aspect. Not just that it can even give you recommendations on whether you should have a buy strategy of talent acquisition or a build strategy focusing on talent development. This can help HR teams meet future demands, reduce this talent shortage and optimize resource allocation aspects. Take, for example, talent management and high performance — This was always a very gray area for most companies. Nowadays, generative AI can analyze performance data; it can assess the leadership capabilities of the candidate using adaptive assessments. It can suggest development programs. It can suggest mentorship opportunities for them, and the career paths simulate scenarios for them to develop their high potential. It can provide guidance on career transitions. All of this can be provided in a very customized manner.

The biggest of all, in my opinion, is the internal talent marketplace. Traditionally, every company would go out to hire for talent, but with generative AI-enabled internal talent marketplaces coming in, an individual employee can be assessed for his/her current skill sets against the skill sets required by the new job to facilitate the internal transition from current role to new role.

Followed by performance management – Generative AI and ChatGPT can be integrated with performance management software so that it can individually help employees on setting smart goals, clarify objectives, helping them with tracking and monitoring their performance. It can help with performance review preparation with bosses or clients too. Even check-in reminders, which used to be done by the recruitment teams, are now done by these AI. 

Employee surveys are always a nightmare for every organization; now sentiment analysis, which can be done on the web browser version of ChatGPT, has made employee survey feedback a lot more robust. 

And finally, the biggest aspect every company talks about is physical wellness. Just an online Zumba session isn’t enough to take care of employee health. We need to move beyond physical or mental wellness to holistic wellness. This data-driven wellness approach can be achieved with generative AI. ChatGPT can analyze big data with inputs from the insurance data with leave and absenteeism data, performance management data, and organizational network analysis and put all this data together, analyze it, and proactively identify people at risk of mental health and offer holistic support. The role of the HR team will now be more proactive in offering support to employees who might need it rather than being reactive, which is the case today.

There are also areas like talent development, compensation planning, shared services, etc that can be enhanced with chatGPT and other generative AI taking the entire employee experience being taken to the next level.

SatJ: Several practical examples of generative AI have significantly personalized and streamlined the entire HR lifecycle process. According to a very recent survey and some statistics, 85% of HR leaders believe that generative AI has the potential to improve their employee experience and engagement significantly. How has Generative AI impacted inclusivity and diversity? Do you think Generative AI can contribute to creating a more inclusive and diverse workforce, and what challenges should organizations be aware of in this context?

Sriram: So I just retrace back to the first statement that I made that Asia is still lagging behind. And if we talk about diversity, it’s predominantly gender diversity in most companies or most countries in the Asia Pacific. People have also started talking about “I,” which is the inclusivity part of it. But if you look at the Western world, they have moved to diversity, equity, inclusivity, belonging, and even justice. So while justice might definitely seem to be a far-fetched theme at this point in time, if you look at it in each of these aspects, generative AI has been able to make a substantial difference.

If you take diversity, it’s not just about gender diversity; it’s about age, race, nationality, orientation, educational and work experience background. All of this can be fixed if you do the right planning and hiring. So deploying generative AI is a big way to make things DEIB-friendly. With HR technology software that is focused only on diversity and inclusivity. The role is to ensure that not just your recruitment process, but your performance management process, your employee engagement and communication, learning and development, operations, and compensation – like pay equity or the gender pay difference – all of these aspects are examples of how generative AI can actually be deployed to identify discrepancies, provide course corrections, etc. to the organizations.

So I think this is a space where you will see a lot more significant impact in the coming years because this is an area where the Asia Pacific is definitely lagging behind, but we’ll need to soon catch up with the rest of the world.

SatJ: HR has evolved from a standard one size fits all process to one that is more personalized and centered around the quality of employee experience and modern HR as well as modern HR professionals must deeply understand how work will evolve in the future organization where the work and the worker are truly augmented by artificial intelligence. So this brings me to ask you a very important and pertinent question. How can HR professionals prepare themselves to thrive in this digital age? And in your experience, are you seeing our HR fraternity equipping themselves to deal with this big change? And if yes or no, what is your answer to that problem or challenge?

Sriram: As an HR professional for over 25 years, my biggest complaint has been that HR teams have not been adopting tech and data as much as they should. They have always been focused on the empathy aspect and less on data and tech, but right now, things are really changing, and we see a substantial need for no more T-shaped skills focus, but V-shaped skills focus. Earlier we would specialize in one area of HR and be generalists in all other areas. But today, there is a need for the HR teams to have a V-shaped focus, which means increasing the level of expertise in multiple areas, multiple adjacency areas, and deep expertise in one or two areas. This is the first significant change that is coming into the life cycle of the HR professional: the strong V shape focus and no more T shape.

The other thing is we have identified nine essential HR skills for the future. Now, I help my college in the recruitment of new students into the program. And then when I have been working, the first question that I asked is, why do you want to take up human resources as a profession? The first thing they say is they like interacting with people. But things have evolved. Essential HR skills of the future that are really critical: 

  1.     Number one is a data-driven approach to decision-making. You need to be very strong in people analytics, which means you need to have a strong base of statistics
  2.     Number two is tech savviness. 
  3.     Number three is strong analytical thinking. No more gut-based thinking, but analytical data-driven approach.
  4.     Another essential skill is design thinking. For employee experience, a key aspect is leveraging design thinking. We have a lot of business cases where companies like Pfizer and Unilever are adopting Generative AI. Unilever used generative AI to come up with the latest Axe brand, and Pfizer is leveraging generative AI in drug discovery.
  5.     Storytelling is becoming an essential aspect. The ability to communicate your data into a strong story for the leadership is something that HR teams need to work on. 

I think these are the aspects that HR teams should start focusing on rather than the traditional areas.

SatJ: Before we conclude, Sriram, we have a customary rapid-fire round for you. 

  1.     What was the first task you attempted using chatGPT or generative AI?

Reviewing my emails for grammatical errors.

  1.     One HR tech trend you will place your bets on?

Strategic workforce planning. Essentially that and data-driven mental wellness are two areas where you will see the increasing focus on generative AI getting adopted because these are the essential needs of the HR function.

  1.     One thing to keep in mind while implementing tech in any HR process.

Change management and HR tech implementation is a journey and not a destination. 

  1.     One core HR competency that you believe technology cannot replace?

I’m a firm believer in technology actually learning more human-like activities and matching human capabilities. So I would say at this point in time, the human element of understanding the empathy aspect, I think humans do it much better than machines. 

The recruiters can still focus on outsourcing the screening function to AI, but the candidate interaction, selling the role, selling the organization, and understanding the key motivation, I think, need to be with the recruitment team. Similarly, in all other functions, you can automate the employee communication and performance management function, but the aspect of interacting with employees to make their jobs much better, providing more security and these softer elements, are much better provided by the HR people right now. 

This episode was filled with plenty of takeaways for HR professionals to thrive in the future of work, the skills and the interactions between generative AI and HR that has the potential to transform the whole talent landscape as we know it.

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