What's Happening?
The 28th Annual HR Systems Survey conducted by Sapient Insights Group has highlighted significant trends in the adoption of artificial intelligence (AI) within human resources (HR) functions. The survey, which included nearly 5,000 organizations representing 30 million workers, revealed that AI adoption in HR has increased to 31%, up from 23% the previous year. Additionally, 39% of organizations have increased their HR tech spending this year. The survey noted a shift in HR tech budgets, with 37% of organizations planning to increase their spending, while 7% anticipate a decrease. The use of AI varies significantly based on organization size, with enterprise organizations showing a 5% increase in AI usage, while small and mid-market organizations experienced 50% and 42% increases, respectively. The survey also found that HR professionals are increasingly using 'bring your own' AI tools for personal work, with 81% of respondents doing so, though less than a third report their company is paying for these tools.
Why It's Important?
The findings from the HR Systems Survey underscore the growing importance of AI in transforming HR functions and strategies. As AI adoption rises, HR departments are being forced to rethink their operational models and strategic roles within organizations. This shift has implications for how HR is perceived by other business leaders, with 59% of CEOs and 54% of IT leaders now viewing HR as a strategic partner. The increased collaboration between HR and IT departments is crucial for leveraging AI to drive talent and business outcomes. Furthermore, the survey highlights the need for HR to better communicate its strategic value to finance organizations and boards of directors, which are currently struggling to see HR as a strategic function. By effectively using data to demonstrate their impact, HR leaders can strengthen their strategic position within organizations.
What's Next?
The survey suggests that HR departments should focus on building stronger relationships with finance teams and boards of directors to enhance their strategic profile. As AI continues to reshape HR functions, organizations will need to invest in intelligent tools and ensure that HR professionals are equipped to leverage AI effectively. The collaboration between HR and IT departments is expected to deepen, as IT leaders recognize the importance of workforce resources in AI implementations. HR leaders are advised to concentrate on executive-level reporting, particularly around learning and diversity, equity, and inclusion (DEI), to better communicate their value to organizational leaders.
Beyond the Headlines
The survey's findings point to broader implications for the HR industry, including ethical considerations around the use of 'bring your own' AI tools. With many HR professionals using free AI tools for personal work, organizations must address potential risks related to data security and privacy. Additionally, the survey highlights the need for HR to adapt to the evolving landscape of AI and technology, which may require new skills and competencies for HR professionals. As AI becomes more integrated into HR systems, organizations will need to navigate the balance between automation and human-centric approaches to workforce management.
