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Introduction to Generative AI in HR

An icon of an AI-generated image on a yellow background with shapes transforming.
Hacking HR Team

Posted on June 25, 2024

Artificial intelligence (AI) has been one of the most popular buzzwords in recent years, causing widespread hype about the possibilities of AI and fears about what – and who – AI will replace.

However, as time goes on, it’s clear that AI isn’t a fad. AI is becoming part of everyday life, including in HR teams. 

Specifically, generative AI – which powers chatbots and conversational tools such as ChatGPT and image generation tools like Dall-E – has become a powerful sidekick for HR to focus more on the human side of HR and spend less time on repetitive tasks. 

So, instead of avoiding or fearing it, HR should work to familiarize themselves with generative AI and the possibilities it can open up for the HR world.

What is Generative AI?

AI is an umbrella term that describes any type of artificial intelligence, usually used to automate tasks or analyze large quantities of data. However, generative AI has a slightly more narrow definition: AI that focuses on creating or generating content or insights, resulting in tools like chatbots and image generators. 

The biggest distinction between generative and traditional AI is the ability to create entirely new content rather than using predefined rules. 

Put simply, generative AI can understand requests, analyze data or information, and then spit out content based on the request and information it has. In an HR context, that means that AI can: 

  • Answer questions from employees or candidates

  • Automatically screen resumes

  • Analyze employee survey data and predict outcomes

  • Generate text or images for email communications

  • Reduce bias in decision-making

How does generative AI work? It relies on two crucial processes: Natural Language Processing (NLP) and Machine Learning (ML). Generative AI uses NLP to understand and generate or manipulate responses similar to a human, which can lend itself to text summarization, sentiment analysis, chatbots, and text generation. Generative AI uses ML train generative AI models and augment training data, which AI uses to make decisions. 

Generative AI can be a game-changer in the HR world to help make HR professionals’ lives easier by enhancing efficiency and personalizing employee experiences, such as learning and development. 

Generative AI in HR Stats

From different news stories, it may seem that every HR professional you know uses generative AI. However, the truth is that only about 50% of U.S. employers use generative AI in HR practices, according to a survey by Littler Mendelson. One of the biggest concerns among executives and HR pros was complying with data protection and information security regulations. 

Organizations' use has increased dramatically within the past few years. According to a McKinsey report, organizations that are using AI in at least one business function have jumped from 20% in 2017 to 72% in 2024. What’s more, Generative AI use went from 33% in 2023 to a staggering 65% in 2024. 

The report also found that generative AI use in HR has had the most meaningful cost reductions. 

An infographic titled '5 Generative AI Use Cases Transforming HR" shows five text boxes with text.

Generative AI Use Cases in HR

There are many different use cases for generative AI in HR that can improve efficiency, add value, and lessen headaches for HR teams. Traditional HR practices that took up time, energy, and resources can be outsourced to help HR pros focus on the human element of the job. 

Here are different some use cases for generative AI in HR.

Recruitment and screening

Generative AI can be a game-changer for recruitment and candidate screening. Recruitment is one of the main functions of an HR team, and HR pros are adept at finding the best-fit candidate for an open position. 

However, screening resumes, writing job descriptions, and interviewing candidates can take up a considerable amount of time, so much so that organizations need to outsource recruitment or hire another employee just to focus on talent acquisition. However, generative AI is able to create efficient processes and automate recruiting tasks to help HR pros focus on finding top applicants without the tedious screening and checking. 

Generative AI can help in many areas of recruitment, including generating interview questions based on job descriptions or candidate information, writing job descriptions, and analyzing and screening resumes to find best-fit candidates. HR can even use AI chatbots to answer candidate questions and even conduct preliminary screening interviews. Given the right information, AI can analyze candidate responses to help predict their success in the job role. 

Employee experience 

Employee experience is one of the most crucial parts of HR’s job – but it can also be one of the most difficult, as HR must adapt the employee experience strategy to a constantly evolving workforce. 

Luckily, generative AI can help HR come up with new and exciting ideas to improve the employee experience and can even use historical data to tailor it to the specific needs of your workforce. 

Using predictive analysis, generative AI can create ideas and strategies based on employee survey data and feedback. AI can deliver actionable insights on what can be improved upon to enhance the employee experience. 

Plus, for particularly large workforces, or particularly small HR teams, HR chatbots can be utilized to help direct employees to the information they need without having to wait on a human response, which can help improve the experience and help HR be more efficient with their time.

Onboarding and training

Each employee is different, but HR doesn’t always have time to personalize the onboarding package or learning and development (L&D) content for employees. Given the right information, generative AI can help bridge the gap, creating content for onboarding or training that meets the organization's needs while also personalizing it for specific employee goals and traits. 

For example, generative AI can utilize a new employee’s job history, psychometric data, and new job role to help create a personalized onboarding package, including a 30-60-90 day plan or first-day itinerary. 

For existing employees, training can be optimized to specific needs of the employee, which can help keep them more engaged and motivated, and ultimately lead to more employee growth.

Evaluation and feedback

Performance reviews are an evolving area of HR, as many HR pros start to shift away from yearly, standardized reviews and opt for a more holistic approach to evluation and feedback. 

Generative AI can do the tedious parts of an evaluation for you – including analyzing performance data, delivering performance predictions and insights, and identifying areas of strength or weakness. That way, when it’s time for employee evaluations, leaders can focus on the whole employee, with data to back up decisions. For managers, AI can also suggest feedback or action items based on evaluation data to help employees reach their goals.

Offboarding and exit planning

Just like Generative AI can be used for onboarding, it can also be used for offboarding and exit planning. 

Generative AI can not only predict turnover, but can also help come up with strategies and insights into helping improve retention. 

When an employee is leaving, AI can help generate exit survey questions and a personalized exit plan to help keep processes smooth as a transition is made. 

If generative AI is supplied with an exiting employee’s work history, it can help summarize the main duties of the employee and their most successful projects to help transfer that knowledge to a new employee or summarize an employee’s day-to-day to help develop a job description. 

An infographic titled '5 Advantages of Using AI in HR' shows a wheel with five benefits of GenAI described in the text.

Advantages of Using Generative AI in HR Operations

Generative AI has already begun to revolutionize the role of an HR pro. While the beginning of the “AI boom” brought up fears about AI replacing jobs or eliminating the HR role, HR pros now know that generative AI is a tool – not a replacement – for HR departments to focus on what matters and eliminate tedious tasks. 

Here are the benefits of using generative AI in day-to-day HR duties.

1. Automates tedious tasks

One of the biggest appeals of generative AI is its ability to automate tedious tasks. This can allow Human Resources practitioners to focus on what really matters—the employees and the overall health of the organization. 

Generative AI can automate several tasks that typically take a significant chunk of time out of HR’s day, including: 

  • Generating email blasts and communications

  • Screening resumes

  • Summarizing documents

  • Answering basic employee questions

  • Creating onboarding or training itineraries 

While it’s still important for HR pros to double-check the content AI has generated, automating these tasks can free up a big part of HR’s day to focus on what matters. 

2. Predicts outcomes based on data

HR can’t predict the future, but sometimes it feels like that’s what you’re asked to do. Whether it be succession planning, talent acquisition, or budgeting, it’s HR’s job to ensure the organization is future-proof and resilient. 

Luckily, generative AI can help. AI can use predictive analysis – which relies on historical data analysis, pattern recognition, and model training – to predict organizational outcomes, including employee turnover, employee performance, or recruitment success. 

3. Reduces bias in decision-making

While it’s important to watch for bias in AI decisions, generative AI can also help reduce bias in decision-making and practices. Although AI is trained on historical data and can, therefore, inherit human biases, it’s adept at looking out for certain types of biases and errors that humans are prone to make. 

One of the most prominent examples of this is in recruitment. While humans may have an unintentional bias when writing job descriptions because they have a certain idea of what kind of candidate they want, AI can help revise the description to eliminate areas of bias and expand the talent pool. Additionally, AI can help eliminate bias during resume screenings and when making data-driven decisions. 

4. Improves engagement

Employee engagement is one of the long-running challenges that HR faces. Engagement for U.S. workers is lower than it has been in over a decade, according to Gallup.

Generative AI can improve employee engagement in a multitude of ways, including using employee feedback and sentiment analysis to provide insights on ways to improve engagement and even more personalized insights on what different groups of employees need to stay engaged. 

5. Saves money for HR teams

Generative AI is often described as a “virtual assistant” for HR, and it can eliminate the need to hire an actual assistant or outsource processes due to the workload. Not only does it save money to avoid having to pay someone to do those processes for you, but the AI tools used by HR pros are often free or low-cost. 

An infographic shows a wheel with the title '5 Challenges When Using Gen AI in HR' and a warning sign surrounded by five sections with the labels: 1. Bias concerns; 2. Ethical dilemmas; 3. Potential  for error; 4. Data Security Concerns; and 5. Relying too heavily on it.

Drawbacks and Challenges

AI doesn’t come without its challenges and disadvantages. There are many considerations that you should keep in mind when it comes to using generative AI in HR.

1. Bias concerns

Even though AI can be less biased than a human or find small places where bias may be a factor, this doesn’t mean it’s free from bias itself. Because generative AI is based on data and information given by humans, it can still have instances of bias, just like humans. 

There are already lawsuits alleging bias from companies using AI programs, and a recent Bloomberg experiment found ChatGPT showed bias when asked to rank a group of resumes.

2. Ethical dilemmas

Similar to concerns of bias, there are also ethical considerations that arise with the use of generative AI in HR. Each individual’s views on the ethics and benefits of AI are different, so some HR pros may be all-in on AI, while others may still have some ethical reservations. 

For example, some believe that using AI for analysis and decision-making about an employee without their consent can take away an employee’s autonomy, especially if there is not enough transparency on the use of AI in the workplace. 

HR pros must also consider accountability and liability for AI-generated content and decision-making and who will be held responsible if things go wrong.

3. Potential for error

One of the biggest issues that HR pros may face when using generative AI is its potential for error and mistakes. In fact, a McKinsey report found that organizations considered inaccuracy the most relevant risk when using Generative AI, and the top risk that organizations are working to mitigate. 

The “AI boom” that kicked off the popularity of tools like ChatGPT began before the technology was fine-tuned. Even though it’s getting more accurate, it’s not perfect. Its information is not up to date and may, therefore, produce out-of-date responses. 

Especially when dealing with compliance and regulation, AI’s output should never be taken at face value and should always be overseen by a human. 

4. Data security concerns

Data privacy and protection has been at the heart of the AI discourse. For HR specifically, it’s important to consider data security when using generative AI. Inputting sensitive company or employee information can be dangerous, especially with the risk of a data breach.  

5. Can be relied on too heavily

Generative AI can be a great tool for HR pros, but there’s also negative consequences if it’s relied on too heavily to do all the work for you. Not only can AI carry risk of bias and errors, but it can also demotivate employees or customers and reduce trust. Generative AI content can be easy to spot and can be a bad look for any company.

The Future of Generative AI in HR

With the recent launch of ChatGPT 4o, it’s clear that generative AI is improving and evolving extremely fast. At the same time, it’s becoming more accessible to people across the world. 

With the new generative AI model, GPT is now able to interpret and analyze video in real-time, including understanding and changing its tone to match the speaker, translating between languages in real-time, and interpreting text such as handwriting on a piece of paper. 

This can open the door for the future of generative AI in HR to be more like a virtual assistant than ever before, including conducting video interviews with candidates and analyzing candidates or employees through video. 

Generative AI in HR is now a part of everyday life, and it’s not going away any time soon. Its uses stretch across different areas of HR, including compliance, recruitment, and employee experience. 

While AI comes with a unique set of benefits and drawbacks, one thing is clear: It will revolutionize HR, whether you’re ready for it or not. 

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