How is the use of artificial intelligence impacting human resources decisions in organizations?
A couple years ago, Standish introduced an article called Algorithm vs Methodology, which was essentially about using artificial intelligence to recruit candidates for jobs. https://www.standishsearch.com/post/algorithm-v-methodology-the-value-of-retaining-an-executive-search-firm
Now, the corporate HR world is going even further with AI, not only determining who gets hired, but also who gets laid off. Certainly, abdicating layoff decisions to an inanimate process relieves a manager of the related responsibility and accountability. And the temptation to use an automated process is understandable when the sheer volume of layoffs approaches the level we have seen recently in tech companies.
AI is also being employed to conduct AI-generated “personality assessments” to assess and evaluate employees as well as candidates.
According to a January 2023 survey of 300 HR leaders by Capterra in the U.S., a whopping 72 percent say that they are preparing for a possible recession. Into the first quarter of 2023,
the dreaded "R" word is top of mind for companies around the country. In the Capterra survey, 72 percent say their employer has already started preparing for a possible recession, while 24 percent plan to start preparing soon.
In the “preparing now” phase, many companies (particularly in the technology arena) have already announced massive layoffs. The interesting thing is how they are going about it—using AI as a tool—to determine which hundreds (or thousands) of people will be let go.
The Capterra survey revealed that 98 percent of HR leaders say software and algorithms will help them make layoff decisions this year. And as companies and their HR departments are tasked with laying off large numbers of people, it’s difficult (and probably painful) for humans to execute alone. From the emotional perspective, it may be easier to layoff someone you know via an algorithm versus your own personal feelings.
Without an understanding of the precise algorithm of the AI being employed, it is difficult to know what factors are being considered when determining who gets laid off. If AI is viewed to be one helpful tool in planning force reductions, how does it address other values of individual employees to the organization? As one example: the potential value that an employee will bring to the business, as the organization changes and the individual grows.
How does it factor in the human interaction between management and colleagues? Finally, what is the message to employees who remain – about what’s important, and what their future with the organization might look like?
Perhaps the more important question is what it says about the leadership of a company that employs AI to make these kinds of decisions?
We welcome your thoughts and comments!
**This article was researched and written using human intelligence and was not AI-generated (as compelling as the ease of that prospect was).**
Greg Mickelson is the Managing Principal of Standish Executive Search, a New England-based firm that advises business owners, executives and boards who are positioning their companies for accelerated growth, change or succession.