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AI in HR: Creating Value With New Technology

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As artificial intelligence becomes more deeply embedded in everyday workflows, it is rapidly transforming the way businesses operate. For example, the recent rise of generative AI and data-driven insights provide an exciting glimpse into future possibilities. In fact, McKinsey estimates that AI could contribute an additional $13 trillion to the global economy by 2030. But what does this mean for AI in HR?

Many employers are eagerly embracing new AI-driven capabilities. And as the co-founder of an innovative HR tech platform, I’ve had a front-row seat in witnessing AI’s early impact.

But despite the enthusiasm, a central question remains: While navigating these uncharted waters, how can employers make sure AI has a meaningful, positive impact on their workforce as well as their business results? Here’s my perspective…

Moving From Hype to Measurable Value

In the HR tech sphere, many tools and service providers are racing to integrate AI into their platforms and processes — often to demonstrate tech prowess. But this, alone, doesn’t create business value.

That’s why problem-solving must be a top priority. Especially now, in this early adoption phase, it’s paramount for solutions to address the real needs of HR leaders, practitioners, managers, and employees.

If this is the goal, what truly matters? AI isn’t just about automation — it’s also about helping organizations save time, improve performance, enhance the employee experience, and provide actionable insights when and where they’re useful. In our world, this translates into feedback processes that are more responsive, managers who are more effective at coaching their teams, and employees who are more engaged and empowered to grow and perform their best.

Mapping AI to Employment Cycle Stages

To understand the tangible benefits of AI in HR, it’s helpful to look through the lens of the employee lifecycle. From talent acquisition to performance management, and from training to retention, AI is shaping each step in the employee journey. Let’s examine what that means for each stage:

1. Rethinking Talent Acquisition: Beyond the Resume

As the initial touchpoint in the employment cycle, hiring is pivotal in defining the employee experience. Traditional recruiting methods may be effective, but they often fall short in capturing the intricate nuances that determine a candidate’s fit for a particular role. This is where the transformative power of AI can propel employers beyond the limits of a conventional resume.

An excellent case is HireVue. This platform uses AI-driven predictive analytics to evaluate a candidate’s suitability based on numerous factors, including facial expressions and tone of voice during interviews. These innovative capabilities work hand-in-hand with recruiters to complement and enhance their human observations. This leads to a more comprehensive assessment that looks beyond surface-level qualifications and reduces unconscious bias.

How AI Adds Value

In a world where first impressions and gut feelings tend to drive decisions, AI adds a more objective layer of analysis. Plus, it helps “read between the lines” of a candidate’s responses for a more holistic, data-driven approach to talent acquisition.

As a result, employers can feel more confident they’re hiring people with personal attributes that fit their company culture and long-term objectives, as well as the right skills and experience.

But the true magic of AI lies in its potential to help decision-makers rethink their perceptions of candidates. Suitability indicators shift from qualifications, alone, to a nuanced combination of skills, culture fit, and long-term potential.

Ultimately, this promises to improve employee satisfaction, engagement, and retention by making it easier to find the strongest talent for each role, right from the start. However, AI can’t run on autopilot. For the best outcomes, employers and platform vendors will need to work together so they can avoid bias in AI algorithms while preserving the human touch that elevates the candidate experience.

2. Redefining Performance Metrics: Objective Evaluation

Performance assessment has long been a foundational HR function. But now, AI adds a new dimension to this process, reshaping how we track and evaluate employee contributions.

With AI algorithms, employers can extract insights that were once beyond reach. This means organizations can more quickly and accurately pinpoint high-potential talent, predict employee burnout, create a comprehensive analysis of any individual’s performance, and identify where they’re making the biggest impact.

How AI Adds Value

To illustrate how this works, consider the case of Fractl, a fast-paced digital marketing firm that relies on the WorkStory platform to drive employee pulse surveys, streamline performance reviews, and support continuous development for its fully distributed workforce.

What’s next? According to MIT Sloan, some organizations are taking this a step further by using AI to generate employee key performance indicators. These KPIs are carefully calibrated and dynamically adjusted to consider each employee’s past performance, while also considering their team’s objectives and their organization’s broader mission.

Although momentum is growing for AI-supported employee evaluation, several fundamental challenges remain. Employers need to foster workforce trust by ensuring their process is transparent and free from bias. As success stories become more widespread and best practices emerge, these barriers to adoption should diminish.

The shift to AI-enabled performance evaluation marks a pivotal moment in the evolution of HR practices. By providing more objective, dynamic, data-driven assessments, it’s possible to unlock new levels of employee potential and improve productivity, while significantly enhancing employee engagement and retention.

3. Empowering Growth: Tailored Learning Experiences

Continuous learning is vital in today’s fluid business environment. And AI is already transforming employee development from a formal one-size-fits-all experience to a personalized and highly adaptive journey.

For instance, imagine tailoring training modules and performance support resources to an individual’s organizational role, career aspirations, and learning patterns. With AI-enabled tools like Degreed, Coursera, EdCast, Docebo, and Cornerstone OnDemand, you can easily identify relevant skill gaps and deliver targeted learning, assessments, and coaching.

How AI Adds Value

These AI-powered platforms curate personalized learning paths, recommend relevant courses, and analyze individual learning behaviors, so employees can develop the knowledge and skills they need to thrive in their current roles. At the same time, they can prepare for future opportunities.

Organizations are rapidly embracing AI-based learning strategies because they see tremendous value in helping employees take charge of their professional growth while remaining aligned with existing business goals.

4. Fostering Retention: Finding the Pulse of Employee Engagement

Employee engagement is the lifeblood of every organization. With AI-based analytics tools, employers can gain deeper insight into subtle engagement indicators. By analyzing informal and formal feedback and communication patterns, organizations can better understand the strength and direction of workforce sentiment and proactively work to improve engagement.

How AI Adds Value

Organizations like KPMG are using an internal AI chatbot and predictive analytics to identify employees who are at risk of quitting, so they can intervene. And in 10-20% of cases, these interventions succeeded.

In this context, predictive analytics depends on historical data and AI algorithms to forecast future outcomes. For employee engagement, it can mean predicting which employees are more likely to leave based on their interactions, sentiments, and previous work patterns.

When the system identifies “at risk” employees, HR can take timely action to address underlying issues. For example, to resolve conflicts with a manager, a disaffected employee may respond to job restructuring, reassignment, coaching, or new development opportunities.

This proactive, personalized approach contrasts with traditional talent management methods that rely on periodic pulse surveys and subjective assessments, both of which may miss real-time fluctuations in employee sentiment.

Fusing AI and HR: Beyond Today’s Challenges

Integrating AI with HR is a journey filled with endless possibilities. But despite the benefits and buzz, HR professionals need to recognize the risks and ensure AI tools are used ethically and effectively.

This isn’t just about efficiency. It’s also about building a workplace that is more empathetic, empowered, and engaged.

In a few short years, AI-enabled HR tools will be ubiquitous. The burden of routine, repetitive tasks will fall more heavily on machines. At the same time, information will flow much more freely, giving business and HR professionals the ability to better understand their work environment, anticipate the need to adjust, and prepare for the road ahead.

As Harvard Business Review says, “These new capabilities remove barriers of expertise and time from the process of data preparation, insight discovery, and analysis and make it possible for ‘citizen data analysts’ to create insights and take actions that improve their businesses.”

We will learn and adapt. New jobs and industries will emerge that we haven’t even anticipated yet. In fact, The Institute for the Future predicts that most of the jobs that will exist in 2030 haven’t been invented yet — and many of those jobs will be created as a result of AI.

As employers move toward a world where AI is seamlessly integrated into HR processes, I think one guiding principle will determine the difference between failure and lasting success. When you’re trying to balance tech innovation with the human touch, ask yourself, “Will this truly help members of our workforce feel more connected, valued, and supported in their professional journey?” If so, you’re on the right track.

Karolina Grabowska

Online Performance Review: How to Evaluate Remote Employees

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What is the best way to evaluate remote employees? Is an online performance review the answer?

We don’t have to tell you: Due to the COVID-19 pandemic, workplace dynamics have changed drastically over the last few months. From minimal personal interaction and connection to increased reliance on collaboration tools and communication technology — the word “office” as we know it has taken a whole new meaning. 

This leaves many companies, as the year-end approaches, to wonder where this leaves performance reviews. Given the absence of in-person interactions: How do you evaluate your remote employees accurately, deliver clear feedback, and maintain trust?

Here are our thoughts…

Before you start the process, devise an employee review strategy and share it with the team. This brings consistency and improves the quality of performance review discussions. Here’s a mind map that demonstrates the importance of the employee performance review process:

employee review process mind map

Now, let’s take a look at how you can conduct productive online performance reviews and drive professional growth in the process. 

Create an Employee Review Template 

If you think you can enter an online performance review meeting and just “evaluate” your team members on the spot, you’re mistaken. Performance review season calls for preparation from both the reviewer and the reviewee. 

The first step of the preparation process is to create an employee review template. This is an effective way to document and track employee performance. It also helps you conduct a focussed review and create a level playing field for all involved. 

Where possible, make it a point to share the template with your team members during their onboarding process, letting them know how they will be evaluated. 

This quarterly performance review example has a section for achievements and areas of improvement; customize to add metrics of value to your company:

 

employee quarterly review

Having an employee review template in place lets you be better prepared for the meeting. You can collect performance data and make your notes based on the key performance indicators you’re measuring, paving the way for a more structured discussion. 

Encourage Self-assessment

Self-assessments are a good way to get employees to reflect on their goals, responsibilities, overall performance, strengths and weaknesses. 

According to a CIO article, companies with effective performance review processes use self-evaluations for two reasons: 

  • To ensure employees set aside time to evaluate their performance
  • To help managers get a sense of whether an employee has an accurate understanding of their impact in the workplace

Encouraging employees to evaluate their performance ahead of a performance review meeting keeps them more engaged in the process while letting managers get an insight into their perspective. 

This self-performance review template requires the employee to write their job description, goals achieved, areas of excellence and improvement — which helps the interviewer assess their impact on the organization while getting their side of the story.

 

online performance review example

Use a Video Conferencing Tool

Performance review discussions can be tricky at any time. The remote working environment certainly doesn’t help the situation. 

While you can’t rely on body language and facial expressions the way you could in a traditional set-up, conducting online performance reviews over video conferencing will help you create a more personal experience and facilitate transparent communication. 

Before the discussion begins, establish video conferencing etiquette guidelines and share them with your team to run an effective virtual meeting.

Provide Clear and Explicit Feedback 

Online or not, managers are expected to be specific with their performance review feedback. Avoid making vague and ambiguous comments as they only end up damaging employee morale and motivation.

Due to the lack of personal contact, this becomes all the more important in a remote environment. Be extra cautious while communicating with your employees and delivering feedback; leave no opening for miscommunication. As Harvard Business Review rightly puts it: you have to be much more explicit and verbal. Listen carefully and spend time to make sure things aren’t lost in translation.

For example, if a sales representative is struggling to fill their sales pipeline, use performance-based data examples (eg. total revenue generated, new leads, average cost per lead, etc.) to offer specific feedback so the employee gets a clear understanding of where and how they can improve. Be sure to make use of the screen-sharing option to walk through documents together and make feedback clearer. 

Another useful tactic to offer detailed feedback is by doing a SWOT analysis. This proven method lets you evaluate the strengths, weaknesses, opportunities and threats while appreciating the positive aspects and identifying areas of improvement. This SWOT analysis template offers a clear picture of the employee’s performance while providing feedback: 

 

employee SWOT

Create a Two-way Dialogue 

It’s not enough to bombard your employees with feedback and consider your job done. An effective performance review is a two-way conversation. It’s important to use this opportunity to get feedback on your managerial skills and address any concerns your employees might have. 

Once you are done with your points of discussion, set aside time to actively listen to your employee and understand how you can empower them to perform better. 

Approaching performance reviews like a dialogue contributes to a healthier, more transparent and productive working environment. 

Conduct Frequent Reviews

In the future, and if you don’t already, don’t wait until the end-of-year online performance review to provide input. After all, feedback is more effective when check-ins are frequent, according to an SHRM article. Many companies are moving toward providing continuous, real-time feedback throughout the year. 

What’s more, when you’re working remotely, conducting frequent one-on-one performance reviews allows you to build relationships and open channels of communication. This lets employees get timely feedback, stay motivated, and also improve on the go. Which, of course, helps you get more done as a team. 

The Takeaway: Conduct Productive Online Performance Reviews

Online performance reviews need to be approached with care. 

From having a constructive review process and documentation in place — to the ability to communicate with clarity — managers, whenever possible, must cultivate a positive performance review culture. A culture that builds trust and also promotes open communication. 

 

 

Applicant Assessments: Testing The Waters

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(Editor’s Note: We invite you to discuss candidate screening techniques in more detail with the entire TalentCulture community, this week at #TChat Events on Wednesday, February 19th. For details, see the #TChat Preview post: Hiring Great Talent: How Do You Decide?)

Can you tell from a resume if an applicant has the skills needed to succeed in a job? How do you know if someone is really the right fit for your company?

If you’re unsure, perhaps pre-employment tests should be part of your evaluation process. Knowledge is power — and assessments can be a powerful addition to any hiring toolkit.

Evaluating Job Candidates: A Smart Strategy

Increasingly, organizations are relying on screening tests to improve their hiring and workforce development decisions. In fact, in a recent survey by Aberdeen Group, 49% of companies said they have an assessment strategy in place — up from only 40% in 2011.

Infographic - How to select assessments for employee screening

See Details: How To Choose Job Candidate Testing Tools

Melissa Hulsey, president and CEO of Ashton Staffing, explains that, with the correct type of test, employers can evaluate candidates effectively across multiple dimensions, including job skills, professional  knowledge and cultural fit. It’s even possible to make behavioral predictions and gain insight into core values.

“Properly constructed assessments look below the surface information presented by applicants to systematically predict which one will be the best hire for a position,” explains Dr. Charles Hanler, president of Rocket-Hire, a consultancy that helps improve organizational hiring practices. He compares the resume review and interview process to the tip of an iceberg. The bulk of an iceberg is what remains below the surface — what you can’t see and touch.

Choosing Applicant Assessments

It’s essential to choose the right type of assessment for your goals. Tests can produce a mind-numbing array of candidate metrics — personality, cognitive abilities, professional knowledge, work skills, physical and motor abilities, emotional intelligence, language proficiency, drug use and even values like integrity. Yet, when evaluations are properly applied, employers can more quickly and confidently identify candidates who are best qualified for open positions and most likely to succeed in the organization.

As the Society for Industrial & Organizational Psychology explains, there are pros and cons to each of the many types of employment assessments. But before deciding how you’ll test candidates, it’s important to determine what kind of information matters most to you. Tests vary according to their mode of administration (web-based tools vs. paper and pencil), content focus (interpersonal skills, mathematical ability), level of standardization or structure, costs, administrative ease, and other factors.

Although there can be significant benefits from using tests in the employee selection process, there are also multiple issues to consider. In particular:

• Validity  Does the test actually measure the characteristic it is designed to measure? For example, does it actually predict future job performance or success?

• Reliability How consistently does a test measure the target characteristic? If an assessment tool isn’t highly reliable, it will be of little value in predicting a candidate’s future job performance. As with validity, a test’s reliability should be verified before it is administered.

• Legality Because employment tests are periodically challenged in court, employers must make sure assessments do not violate federal, state, or local EEO laws, including Title VII.

TYPES OF CANDIDATE TESTS
Assessment Centers Often used to assess interpersonal skills, communication skills, planning/organizing and analytical skills. Typically involves exercises that reflect job content and types of problems faced on the job.
Biographical Data Uses questions about education, training, work experience and interests to predict success on the job. 
Cognitive Ability Tests Assesses aptitude or potential to solve job-related problems by focusing on mental abilities such as verbal or mathematical reasoning, or perceptual abilities like speed in recognizing letters of the alphabet.  
Integrity Tests Assesses attitudes and experiences related to honesty, dependability, trustworthiness, reliability and pro-social behavior. 
Interviews The most common type of employment test. Typically assesses interpersonal skills, communication skills and teamwork skills, and can be used to assess job knowledge.
Job Knowledge Tests Typically uses multiple choice questions or essays to evaluate technical or professional expertise and knowledge required on the job.
Personality Tests Measures traits related to behavior at work, interpersonal interactions, and satisfaction with different aspects of work. 
Physical Ability Tests Uses tasks or exercises that determine ability to perform. Measures physical attributes and capabilities, such as strength, balance and speed.
Work Samples and Simulations Measures specific job skills or job knowledge, but can also assess general skills such as organizational, analytic and interpersonal skills.

How Do You Evaluate Job Applicants?

Do you use pre-employment tests to screen applicants before they’re hired? Has this been effective for your organization? How does this help or hinder your company’s candidate experience? Share your experience in the comment area.

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