AI In HRM: New Perspectives, and Challenges Ahead
Volume: 1 Issue: 01 | Feb-2025
Article | Open Access | Published: 21 February 2025
AI In HRM: New Perspectives, and Challenges Ahead
Marshall Elan
Independent Researcher
Abstract
AI-driven HRM is fast emerging as an innovative technology solution, providing businesses with new opportunities to optimize their human resources and interrelated management operations more effectively. It impacts almost all business sectors and industries, IT and non-IT enterprises, operating in the digital world. Though it offers myriad benefits, there are challenges that businesses need to tackle to successfully integrate and use AI technology in their HR business processes. This paper provides insights into HRM paired with modern Artificial Intelligence (AI) practices, and how firms can utilize AI in HRM to compete and overcome a host of human resources problems and ultimately propel their organization to new levels of success. It compares and contrasts the past, the present, and the future perspectives in the HRM industry with AI being a transformative force. It explains how HRM with AI can effectively enhance operations, and increase efficiency, transparency, and reliability. It also explores distinct methodologies, and procedures that assist in identifying and overcoming a wide gamut of problems that exist in automating HRM-related operations at any firm. Furthermore, it analyzes challenges and provides possible solutions to overcome AI-enabled HRM problems too.
Keywords: AI in Human Resources, HRM Automation, Automation Challenges, HRM and Artificial Intelligence
Introduction
AI is currently in use in HRM to overcome a wide gamut of problems resolving around recruitment, talent management, employee performance evaluation, training programs, and other core areas.
Human Resources Management (HRM) is regarded as the backbone of a healthy and growing firm. It is the human resources department that helps the organizations navigate the challenges of finding and hiring the right talent that will ultimately help the organization reach its goal (Kess-Momoh, et al., 2024). Hiring talent on demand usually involves a sound process. Before the advent of technology, it was more challenging for the HR teams and team leaders to manage all the internal and external operations of human resources. An HR will have a wide range of tasks to perform from evaluating the needs for hiring a candidate at a company, to charting out new routes to get the talent on board, negotiating with the employees, ensuring that the employees have a safe and secure work environment at the organization and other similar operations.
All these tasks were time-consuming. Plus, it was incumbent upon the organizations to hire only a talented HR expert who could prove to be a real asset for the firm and work as per the guidelines, hire for the company the talent required to streamline operations, and also manage the talent effectively well - all these without any support from modern programs and technology solutions that are available for the HRs currently.
Gone are the days, when HR was left only with performing all tasks themselves without machine assistance (Zhang and Chen, 2024). Today, there are software tools and programs that provide great assistance in optimizing all tasks that fall within the realm of human resources and management. With the introduction of modern tech solutions, ATS systems, and AI-powered HRM systems, HR functions are more transparent and take less time to deliver great results too. No doubt, using such powerful systems involves a significant investment but it is considered a smart choice too. If the right AI system in HRM is integrated with all due focus on goals then it can turn out to be the best system to boost business success (Faheem, et al., 2024). Some companies want to scale up their business operations. They may have the staff needed to manage a wide range of tasks. However, they want to elevate efficiency in business and therefore look for ways to automate a whole or a part of the operation which eventually leads to great results.
Recruitment and AI: Automation Works
AI has made it all possible for companies to take on automation in HRM. Automation is a process that makes it easy for any business to operate with minimal or without human effort. The machine will take on the operations. The system will run on its own when it is set to perform a particular task (on predefined terms). Budhwar, et al., (2022) explain that AI-driven HRM as a field is expanding greatly. There are small and big firms that prefer to optimize their business operations with AI in HRM operations.
Hiring is a big process. It is important to have a proper strategy to find and hire the right talent. Manual tasks from assessing the job requirements to writing the job posts and collaborating with the senior team leaders HR managers, and stakeholders are streamlined with the AI systems in the Human Resources Management sectors. A study conducted by Alsaif and Sabih Aksoy (2023) shows that for a particular job, there could be hundreds or thousands of applications. The count of applications for a job increases when the job is in more demand but the vacancies are often limited in number at organizations operating from different locations or regions. The tracking of applications was always a herculean task. Sieving through the piles of CVs was daunting and frustrating for the HRs of the past. But, with the introduction of the tracking systems, modern HRs do it with all ease. The Application Tracking System (ATS) will track the applications. With a chatbot, interaction with the candidate also becomes much simpler. The systems powered with AI reduce the time to hire. With predictive analytics, HR professionals make much better decisions (AL-Qassem, et al., 2023).
There is an increasing number of companies adopting HRM systems backed up with AI technology for onboarding. The HRM systems are integrated with the AI systems to assess the candidate's suitability for a job. The system will scan the CVs of the job applicants and provide an overview of who is more eligible for the job and who is not. Furthermore, the system is more capable of scheduling the interview with the candidate. It will be more reliable in assessing the candidate’s potential and capabilities by conducting behavioral tests, and skills-based tests too. The system will also be effective in storing the data and providing analytics (Jaser, et al., 2021).
Employee Performance Management
Hiring a candidate is the beginning of a new task for HR too. When a new employee joins the team, the responsibility of HR increases tremendously. The hiring team will have to devise strategies that ensure that the employees have a great time at the organization. Apart from this, it would be important to track the performance of the employees. This performance evaluation in the past was more confusing and unidirectional too. It was based only on whether or not the project was completed on time and how smartly or logically it was managed. But even such evaluation was not free from errors. Today, performance evaluation is through tech systems, and these systems are embedded with the power of AI which provides insights into the performance of the employee. This greatly helps the HR team in evaluating the work of the employees and provides employees with extra benefits as per the company policies. (Madhumita, et al., 2024).
Tracking productivity through real-time feedback became possible with the AI systems. Apart from this, the system provides automated reviews on the performance of the employees. Insights from workforce productivity further help the decision makers in selecting the star employees and honor them with extra benefits for more productivity (El-Ghoul, et al., 2024).
HRs with AI knowledge are preferred
Currently, in companies HR professionals or teams work with AI systems. AI-induced HR roles are predominately growing. Companies prefer to hire HR teams that have great skills in automating HR operations, or at least employ AI effectively well to improve their hiring, onboarding, employee management, salary management, and well-being of the employees. Before the growth of AI-based systems, all these tasks seemed impossible or too much to handle for the HR teams. But now, such tasks and other similar tasks are carried out with ease. HR teams use predictive analytics to come up with a customized HR plan. A study conducted by Sunil (2025) shows that with greater emphasis on HI-AI collaboration or human and machine collaboration, organizations are now capable enough to overcome problems more easily and also perform effectively well. Further, Sunil (2025) explains the challenges underlying the integration of AI in business systems and operations and how companies can deal with the change and introduce and manage the change.
A wide gamut of challenges exists in HRM with AI. Issues from bias concerns, data storage, data security, management, and implementation are common. Companies need to employ the right methodologies to deal with the challenges as no or less attention to such challenges does not produce any positive results.
Challenges in AI Integration in HRM Systems and Possible Solutions
Employee Well-being
Employees are more prone to move out of the firm when they do not see any growth opportunities. Employees with a growth mindset may want to switch to new roles or take on new challenges but when the organization doesn't offer them such opportunities they prefer to move out. AI-based prediction models that rightly predict the well-being and career progress of the employees at the company help companies greatly in assessing how their employees will react, and how the employee retention rate will be (Faye-Schjøll and Høye, 2020).
Ethical Concerns
AI algorithms may be prone to be a little biased when the data fed to the system is not proper. Data training is more decisive, and the AI systems make decisions based only on the data they are fed with. The result could be insightful but still, it is incumbent upon human-only teams to take the necessary precautions and ensure that the decisions are right and are goal-oriented (Lungu, 2023).
Data Privacy
Employee data is always sensitive. The collection and storage of data need to be well structured. The data policy is explained to the employees at the start of their employment. Companies have a great responsibility in collecting, storing, and managing data. A small error in data handling can lead to big problems for the companies. Compliance with government systems, data protection policies, and regulations is susceptible to change too. Today, digitized HR systems are open for attacks (Sachan, et al., 2024). There can be numerous attacks on digitized HR systems. Dealing with cyber security issues can be overwhelming but companies who are proactive and prefer to take on advanced security procedures survive well. The AI-based HRM systems will offer updates on how HR operations are. It may send notifications to the stakeholders or the decision-makers when it detects any harmful activity. With timely action, it can be more helpful for the companies to thwart away all risk-related tasks (Sunil, 2025).
Replacing Human Jobs With AI Bots
Are AI bots taking on human jobs? Is the future fully automated? There is still for it. The near future will have jobs that are a mix of AI and Human Teams. There is a growing fear of AI consuming a variety of human jobs within the HRM industry (Poba-Nzaou, et al., 2021). Though AI is useful in multiple ways, it can't be equivalent to HI (Human Intelligence). AI's potential can only be increased when it is synced smartly with the HI (Faheem, et al., 2024).
Hybrid Work Management With AI-Powered Systems
Employees are more drawn to Hybrid work. They want to work from the office or from anywhere they are without having to come to the office daily. Though this could pose some challenges in managing the work for employers, the use of AI to a certain extent has also simplified it (Grzegorczyk, et al., 2021). Tools such as Trello, Asana, and others have revolutionized task management. The tools come with AI integrated into its core features of tracking the tasks, setting deadlines, and prioritizing the tasks. Smart tracking tools like Time Doctor and other similar tools are more efficient in assessing the number of hours employees work per day/week/month. Similarly, virtual collaboration tools, team management, online meeting tools, and AI chatbots make work easier. The employees and the employers no longer feel disconnected even if they are poles apart. The AI models help with improving team collaboration, scheduling meetups, feedback analysis, and support systems (Van Der Aalst, et al., 2021).
Employee Retaining And AI-driven HRM Systems
Continuous training is considered essential for employee skills growth. Organizations need to conduct training programs that will help build new skills among employees which in one way or another will make way for the company to tap into the new potential of the employees, improve business, and deliver improved services to their clients. In the past, the HR teams were responsible for charting out the plans based on the needs of the employees. Assessing the candidate's capabilities was itself a big task. But, currently, based on the performance of the employees, and how the projects are executed, delivered, and managed, the HR team leaders come up with customized training plans using AI systems (Rao and, Chitranshi 2020). The AI system will provide insights into the performance of the candidates and also group the employees into categories that need special attention, special skills, and categories for employees who are looking for new growth opportunities. There are AI-based systems and VR training tools that connect the trainer and the trainee effectively and offer more realistic and results-driven simulations for the training (Vladimirovna, 2024).
Conscious or Unconscious Bias in Hiring the Right Talent
Bias in hiring is common. However, it often goes unnoticed and gets noted when the senior leaders or decision-makers get into the process to find what the hired teams or employees lack or what hinders them from reaching goals. It might become more evident only on deep analysis by the top-level executives. Bias in hiring can be unconscious or conscious (Albaroudi, 2024). In most cases, unconscious bias comes to the surface when recruiters, talent hunters, interviewers, and hiring team leaders tend to favor certain candidates based on age, gender, and other factors that are considered less significant for the job. Bias in hiring was growing as one of the biggest problems, but AI data-driven hiring helped reduce bias in hiring to a great extent. The AI-powered system will screen resumes without taking into account gender, religion, ethnicity, etc. It can detect the best match for the job vacancy based on core parameters such as experience, skills, education, past achievements, leadership, and other core factors. The system will help gather resumes that match the job requirements greatly and also select the best from the bunch. In other words, it can easily prioritize blind hiring where the recruiters do not know what resumes are selected to move forward to the next level of hiring, that is call for the interview. Once the system reveals the best match for the job, the human teams can move forward to the second level of interviewing. It is also worth mentioning that the AI system can also flag discriminatory, inappropriate, and unidirectional hiring processes or hiring operations. With advanced AI-based analytics, dealing with bias has become much easier (Jibril, 2024).
Conclusion
Artificial Intelligence is rapidly transforming HRM. AI has its influence on almost all HRM operations from finding the right talent to recruiting the right staff for the firm, managing the employees, performance analysis, and other core tasks that fall within the realm of HRM. By combining machine learning capabilities and human abilities businesses can move forward and overcome hurdles more easily. The future of AI in HRM is promising with the industry growing incessantly. AI-driven HRM systems will continue to be more dynamic in performing a wide range of tasks which in one way or the other will help bring much better results. More advanced AI applications in the HRM industry are poised to take the HRM industry to new levels of ease and management where recruiters, HR teams, leaders, and managers will be able to hire more smartly than ever and also save time.
Compliance with ethical standards
Disclosure of conflict of interest
No conflict of interest to be disclosed.
Under a Creative Commons license
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