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How Big Data and Artificial Intelligence Can Help Local Government HR

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Matthew Teal
February 4, 2018

My opinions are my own and do not represent the University of North Carolina at Chapel Hill.

Local governments should adopt big data and artificial intelligence (AI) in all stages of their human resources (HR) operations. Ongoing advances in AI can help improve recruitment and hiring, reduce administrative paperwork for HR staff and assist with employee retention. Big data and AI have the potential to allow local governments to do more with less in an era of simultaneous citizen demands for more government services, as well as declining interest in working for government. (Note: there are also risks with using big data and AI in HR. AI risks will be addressed in a separate column.)

First, AI can help with several tasks related to hiring. In a January 23, 2018 article from McKinsey titled, “Human Resources in the Age of Automation,” Mili Bustamante and Neel Gandhi wrote that AI chatbots, “Can answer routine questions instantaneously and be available on employee [and applicant] phones [24 hours a day]-a better service experience than calling an HR hotline.” If a chatbot does not know the answer to a question or if the requestor is unhappy with the response provided, the chatbot can then connect the requestor with an HR employee for a follow-up conversation. Bustamante and Gandhi also wrote that, “With time, opportunities will abound to automate more elements of the hiring process. For example, a bot can draft offer letters, write job descriptions or set up payroll and benefits data.”

Of course, the big promise for AI in hiring is resume review. In a January 30, 2019 article for The Verge titled “The next frontier in hiring is AI-driven,” Megan Farokhmanesh wrote that “AI’s place may be most valuable for shortening the slog of application vetting. … Instead of one person reading through hundreds of resumes, … AI can quickly sort through data. [AI can connect] to a company’s applicant tracking system, works out who has applied, and compares it against people who have already been hired and are doing well.”

Second, the use of big data and AI in HR has the potential to reduce the overall paperwork burden on HR staff. For example, Bustamante and Gandhi wrote that their, “analysis suggests that 56 percent of typical ‘hire-to-retire’ tasks could be automated with current technologies and limited process changes.” A 2018 Deloitte report titled, “HR Bots: The New Super Power for the Workforce?” found, “that 22 percent of the highest-performing organizations are currently implementing or have implemented Robotic Process Automation [RPA]  for use in HR, compared with just 6 percent of the lowest-performing organizations.” Deloitte defined RPA as a process whereby software “can gather and collate information, analyze and record data, communicate with users, even anticipate outcomes, interacting with applications just as humans would.” Deloitte considers RPA to be a mature cognitive technology and good first step for organizations looking to do more with less. Deloitte highlighted the low adoption rates of even relatively basic cognitive technologies like RPA in the HR field as a whole, to say nothing of more cutting-edge technologies such as machine learning and AI, and called for HR as a field to step up.

Finally, big data and AI can help improve employee retention rates by allowing HR staff to identify and take steps to retain those employees most likely to leave. The Economist noted that, “On average, replacing a worker takes around 20 percent of annual salary, sometimes much more. [Software companies have] started to predict how likely employees are to leave. [The software] looks at around 60 factors, such as pay, time between holidays taken and turnover in managers to whom the employee reports, and flags those at risk of quitting so companies can try to retain them.” Again, by supplementing HR staff, big data and AI allow HR staff to devote more time and attention to hiring and retaining the best employees possible.

The transition to using big data and AI in HR will not be easy or quick, yet it is essential for local governments who want to remain competitive when trying to hire, train and retain skilled employees. In a January 4, 2019 article in Workforce titled, “AI is coming-and HR is not prepared,” Sarah Fister Gale examined recent survey data from IBM, PWC, Deloitte and others. She claimed that HR departments are missing key opportunities to improve how they operate. Gale cited David Mallon, chief analyst for Bersin by Deloitte, who argued that, “‘Every other part of the organization is accustomed to using data to support decisions, but not HR… They lack data fluency.’” Gale noted that the key to success is to start small. She said, “Starting small will allow HR to either fail fast or prove the benefits of AI-and their own ability to leverage it-which will help them win over stakeholders and bolster the workforce’s confidence in their ability to navigate this digital transformation.”

Local governments must get started immediately. Their future depends on it.


Author:
Matthew Teal, MA, MPA
Policy Analyst
University of North Carolina at Chapel Hill
Email: [email protected]
Twitter: @mwteal

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The American Society for Public Administration is the largest and most prominent professional association for public administration. It is dedicated to advancing the art, science, teaching and practice of public and non-profit administration.

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