Why Are Modern Enterprises Implementing AI in HR?

Updated on Apr 24th, 2024

Why Are Modern Enterprises Implementing AI in HR

Industries are being fundamentally changed by the automation and augmentation capabilities of artificial intelligence (AI), enabling amazing productivity and economic growth. The reports from the last few years have been quite encouraging, showing how AI has improved corporate operations and generated significant returns on investment. Technology has surpassed all expectations, and AI’s changing HR represents nothing short of a revolution.  

Companies are now relying heavily on AI in human resources, and there are several benefits to doing so. The obvious advantages include higher revenue generation, improved effectiveness and accuracy, and substantial time savings.  

Also, AI is proven to be a crucial tool in human resources, giving HR managers the deep, analytical insights they need to make data-driven choices, lessen human bias, and establish themselves as true strategic partners. 

In this blog, we’ll discuss how artificial intelligence can improve your HR procedures. Furthermore, we’ll discuss why companies today are embracing AI in HR.

  • By 2030, the market for human resource management is anticipated to reach USD 56.15 billion, growing at a 12.8% CAGR between 2022 and 2030.
  • The HR service line also considers employment practices, performance management, and job design in addition to creating new regulations, ensuring onboarding requirements adhere to standards, and other things.  
  • Streamlining HR functions, reduce tedious and repetitive tasks are some of the benefits of AI in human resource management.

AI in Human Resource Management: A Vital Part?

The HR department is responsible for several processes, from planning to implementation. The HR team helps an organization fulfill its mission and vision.  

47% of HR departments are anticipated to use AI in some form during the next few years. This is not surprising given the variety of ways AI might benefit HR departments by boosting productivity.

The incorporation of AI in human resources will not only boost organizational effectiveness but also result in workers who are more suited to the company’s goals. 

Moving ahead, let’s discuss this,  

Top benefits of AI in Human resource management!

Some of the benefits that you can gain by incorporating AI in human resource management are: 

Helps in Administrative Tasks

HR managers can oversee a sizable workforce and ensure everyone performs their duties. By automating time-consuming or repetitive operations, AI can help them operate their business more effectively. 

HR managers can concentrate on more crucial areas of the business’s job, like strategic planning and decision-making by streamlining administrative functions like scheduling, tracking personnel, and handling payroll.  

Helps to Find Qualified Candidates

The employment process has been eased in several ways thanks to artificial intelligence. Before speaking to a live person, applicants can submit resumes, answer qualifying questions, and go through the preliminary screening process. 

Finding the ideal candidates from a big application pool is frequently cited by recruiters as the most challenging aspect of recruitment. By automatically vetting and qualifying applicants, AI can save time by providing recruiters with a shortlist of candidates to choose from rather than trawling through a wider pool.  

Streamlines Onboarding

The onboarding and training can be streamlined and improved with the help of AI tools. Using custom AI-based HR software solutions to introduce new hires to various parts and walk them through normal operations might considerably minimize the amount of attention that HR must typically give to new hires.  

The recruitment and training of new employees, which would typically take a human resource professional days or weeks, is now done by AI algorithms. AI-based software can design the optimal training plan for a particular employee by including the new employee’s talents, affinities, and expertise. Intelligent bots can also be employed to respond to inquiries about insurance, plans, and other topics. This enables HR teams to concentrate on their strengths, which include analysis, decision-making, talent growth, and management.  

Reduces Hiring Cost

AI is being utilized to speed up and save money on applicant screening. AI recruitment technologies swiftly evaluate applicants and provide those who are most likely to meet the requirements for the position. As per the reports, AI-using recruiters experience a 30% decrease in cost-per-hire.  

Teams can save longer-term costs by incorporating AI tools into the procedure. An AI tool can reduce the expenses of employing the incorrect individual in situations where candidates frequently lie on their resumes or where human bias affects the hiring process.  


Human resource managers can now see trends in their workers’ activities at work because of AI’s significant impact on HR. All of that is made possible by the advancements in object detection and image segmentation techniques. 

For instance, HR can determine if employees feel pushed or happy with the work environment by examining employee behavior patterns.  

Automated Reports

AI solutions can be used by HR staff to create reports automatically. Removing human data entry, not only saves the HR team time but also ensures that there are no errors, which reduces compliance worries. In order to ensure compliance with both internal and external processes and standards, NLP-based HR reporting automation can help. Additionally, HR departments may use artificial intelligence to build incredibly interesting reports and dashboards for a range of purposes, including analyzing recruitment results and monitoring employee performance. Utilizing AI solutions expedites the creation of reports while also enhancing the accuracy of the data they contain.  

Apart from the above, some other benefits of AI in human resource management are: 

  • By minimizing ineffective sourcing and other processes, cost per hire is significantly reduced. 
  • As individuals are spared of operational burdens and can instead concentrate on the available prospects, it promotes human work satisfaction. 
  • Hiring quality dramatically improves. 
  • As recruiters can devote more time to helping prospects locate the perfect position and less time to administrative activities, candidate satisfaction rises. 

Read More: How to Build Custom Human Resource Software for Enterprise?

Top Use Cases of AI in Human Resource Management!  

Artificial intelligence (AI) is transforming conventional HR departments in various ways. AI can help almost every aspect of an HR department’s operations, from straightforward data entry tasks to talent recruiting. The top applications of AI in human resource management are listed below. Have a look! 

Resume Screening

Even while screening resumes is not a strenuous activity and doesn’t require much training or complex analytical abilities, it is time-consuming. Simple criteria that each applicant must meet in order to be shortlisted are all that is needed for resume screening, along with plenty of time. 

Here, artificial intelligence can take the role of humans entirely. Simply feeding the data into an AI solution and letting it work its magic is all that is necessary. In addition to reviewing resumes, AI solutions can search the company’s internal database for former applicants who might be a match for current job positions.  

Performance Management 

From goal-setting and management to employee evaluations and performance evaluations, the performance management process must be organized to be objective and consistent with corporate objectives. HR must involve all stakeholders in creating an AI-driven performance management system. Using continuous feedback processes and 360-degree feedback loops with the proper notifications and smartly linked with manager outputs, for example, can help people get ready to perform at their best.  

Candidates Screening

As seen, the most time-consuming step in the employment process is screening. AI screening solutions are designed to speed up this process by swiftly extracting information from applications. 

AI screening solutions take a variety of approaches, ranging from resume parsing to behavioral and competence evaluations. In general, predictive performance based on skill testing is likely to be a better method of matching applicants with open positions because skill testing reveals current knowledge and abilities as opposed to the historic nature of resumes. In either case, AI tools speed up the process and aid in the positive screening of prospects.  

Time Tracking

Monitoring each employee’s timeline can be made more accessible by automating HR solutions. Many HR automation technologies can evaluate timesheets automatically, give data on working hours, and speed up approvals to better manage payroll operations. Given the potential of process automation, several businesses have used AI from the beginning to streamline HR procedures. HR solutions based on AI and machine learning can easily track and deliver real-time statistics, enabling enterprises to gain in-depth knowledge and make smarter choices.  

Conducting Interviews

In 2020, video interviews started becoming more common, and we expect this trend to continue. AI can conduct preliminary interviews, significantly reducing the size of the field, especially for positions that often receive a higher volume of applicants. 

In effect, AI will conduct the interview instead of a real person. AI is able to analyze audio responses to questions that have been chosen in advance for each candidate and can interpret facial emotions. The applicants will then be sorted and scored by the computer based on their responses, with the lowest-scoring candidates being eliminated. Theoretically, providing each candidate with the same experience, regardless of age, gender, race, or color, will help eradicate biases.  

Payroll Management

Automation driven by AI can simplify processes like salary disbursement, leading to better time management, precise pay calculations, and simple payroll record storage. Managing leaves, obtaining manager approvals, and keeping track of leaves are all responsibilities of HR executives. With the capability of AI in human resource management, businesses of any size or status can quickly automate critical procedures like leave and payroll management.  

Read More: How to Make a Payroll Management Software?

Sorting Applications

Most businesses receive a massive influx of resumes and job applications every day. The HR team is responsible for going over every application and choosing the best candidates that fit the needs of the business. AI techniques can screen out irrelevant individuals and assess the desirable prospects before asking them for in-person interviews by scanning for critical data points like education, experience, and desire to relocate.

Looking for AI Based Recruitment And HRM Development Service


Although it’s not the only determinant of success, AI in human resource management can drastically change the domain and assist managers in reviewing and reorganizing processes.  

With the usage of AI, the potential of HR is more dynamic than ever. Thanks to artificial intelligence, HR specialists and managers will be able to oversee the entire process without making pointless hires. A lot of industries have been affected by AI, and this trend will only continue. It will improve everyone’s future and make our lives simpler. Artificial intelligence will make longevity more comfortable. 

By incorporating AI into your company’s human resources, your team will be able to handle HR procedures effectively and avoid issues. Working with an AI development services provider like Matellio will allow you to put more of your attention on your staff and expand your company. To find out more about how AI-based HRM solutions can help your company, get in touch with us.

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