The Transformative Role of AI in Human Resources

Yes, it’s another article about AI. But unlike the scores that ponder the implications of AI from a 30,000-foot view, this one will zoom in to look specifically at how AI is currently impacting the human resources function, and the ways in which it’s likely to transform HR in the near future.

Current applications of AI in HR

Artificial intelligence has upended many roles and business units in recent years, and HR is no exception. HR professionals and people leaders are increasingly integrating AI into their workflows to boost efficiency, reduce costs, and improve experiences in every stage of the employee lifecycle.

Recruitment and talent acquisition

AI has significantly streamlined the administrative side of the recruitment process.

• Generative AI helps hiring managers and recruiters write job descriptions.
• AI-powered recruiting tools place personalised content and job postings in front of qualified candidates.
• Chatbots schedule interviews and answer benefits questions.
• AI screening tools filter resumes and conduct initial candidate assessments.

In short, AI is helping to reduce bottlenecks and speed up the hiring process to get the best candidates in the door quickly.

Aside from easing administrative burdens, AI is also giving HR leaders new insights into their companies’ recruiting and hiring processes by tracking data on candidate interactions, application drop-off rates, and time to hire. Armed with more time and more insights, recruiters are now able to focus more on strategic initiatives, relationship-building, and elevating their employer brand.

Employee onboarding

In the very recent past, employees often experienced onboarding as a whirlwind of meetings and emails about benefits, policies, systems, and structures, followed by a bewildered sense of “so… where do I start?”

Today, AI-enhanced onboarding systems are providing new hires with personalised resources, orientation, and training programs to help them hit the ground running in their new roles. These systems can answer common questions, guide employees through necessary paperwork, train them on relevant tools and programs, and ensure a smooth transition into the company.

Pro Tip: Pairing a streamlined onboarding process with recognition creates an incredibly affirming experience for new employees. Here’s how to add recognition to onboarding.

Performance management

Over the past several years, we’ve seen performance management shift from the annual review to the continuous, co-created performance review. It’s now in the midst of another change, thanks to AI’s ability to analyse and synthesize data from various sources, such as project management tools, 360 reviews, and customer feedback.

Where HR leaders once consulted siloed data from subjective assessments and monthly reports, they’re now enjoying real-time insights and more holistic views into employee productivity. This not only helps managers better understand skill gaps and strengths, it helps them offer timely support and recognition.

Employee engagement and retention

When culture leaders need to gauge employee involvement and morale, they’re increasingly calling on AI-powered tools to analyse employees’ communication patterns and sentiment feedback. These insights help HR teams identify potential issues and take proactive measures to improve employee satisfaction and retention. 

People leaders are also using AI and advanced analytics to impact engagement and retention in more targeted ways. The O.C. Tanner Culture Cloud platform, for example, features a Flight Risk dashboard that identifies employees’ risk of attrition related to the amount of recognition received, an AI coach that helps people offer more meaningful recognition, and other AI-powered engagement and retention tools.

The future potential of AI in HR

No one can predict the future with absolute certainty, but here are some likely next steps for AI in human resources:

Workforce planning

AI could play a crucial role in workforce planning by predicting future talent needs based on historical data and market trends. This would enable HR professionals to make more informed decisions about hiring, training, and development, ensuring that the organisation is always prepared for future challenges.

Learning and development

AI has the potential to revolutionize employee training by creating learning programs tailored to individual needs and career goals. By analyzing an employee's skills, performance, and preferences, AI could recommend specific courses, workshops, and development opportunities and even plan rewards-based learning initiatives or chart hyper-personalised career paths.

‍To learn more about how skillbuilding and development help employees thrive, read “Thriving at Work” in our 2025 Global Culture Report.

Diversity and inclusion

Ideally, AI will help organisations achieve their diversity and inclusion goals by continuously improving how they identify and mitigate biases in recruitment, performance evaluations, and promotions.

Health and wellbeing

AI could also be used to develop personalised health and well-being programs for employees. By analyzing data on employee health and work patterns, AI can recommend interventions and resources to support mental and physical wellbeing.

The benefits and risks of AI in HR

The time-saving benefits of AI are the most obvious and widely touted, in nearly every industry. But in HR, other benefits are also clear. And while artificial intelligence has many obvious benefits for HR teams and the people they support, it’s not without potential downsides.

The role of AI in shaping workplace culture

Artificial intelligence is already transforming the way HR professionals attract, engage, and retain employees, perhaps most notably by freeing them up to spend more time interacting with people in meaningful ways—isn’t that why we got into this field, after all? And it’s exciting to imagine how AI might help us streamline workflows and shape cultures in the future.

It’s more important than ever, however, to ensure that people remain at the centre of the picture. The most effective HR teams will be those that take an active role in designing, implementing, and testing the applications of AI within their organisations, and those that engage technology first and foremost as an aid in creating thriving workplace cultures.

See how AI can enhance your employee recognition program

O.C. Tanner designs AI tools and advanced analytics within its Culture Cloud platform to help leaders prioritize people and strengthen workplace culture.

Our Culture Intelligence suite includes:

Recognition Coach: Delivers optional in-the-moment micro-coaching to improve how employees communicate and recognise one another.

Flight Risk Dashboard: Visualizes the number of employees at risk of leaving in relation to the amount of recognition they’ve received, so you can recognise people before it’s too late and reduce the costs of turnover.

‍Job Transitions Dashboard: Tracks employees’ job transitions and related recognition activity, helping you ensure that people with new roles, teams, or responsibilities are being recognized early and often.

Smart Nudges: Turns recognition and redemption activity data into desired outcomes, increasing platform engagement and communicating best practices to continually improve recognition experiences across the org.

My Circle: Identifies employees’ informal connections, surfacing meaningful recognition opportunities and strengthening bonds within teams.

See how people-centered AI can help you deliver transformative recognition experiences. Demo Culture Cloud today.