AI looks set to be a game changer for HR

There is no dubt that the adoption of artificial intelligence (AI) is going to be a disruption for any industry. The question is how big a disruption will it be and whether disruptive innovation is what will bring about positive change.

For Hong Kong’s recruitment industry, the answer remains to be seen, but observers believe that the industry is on the edge of a fundamental change and a major disruption even though it has been slow on the uptake.

“Integrating technology into the recruitment and hiring process is not new to HR and artificial intelligence is indeed changing the game for the industry,” says Natasha O’Brien, client solutions and business concepts director at recruitment firm Ranstad Hong Kong. “The recent developments in AI and a burgeoning start-up scene have further propelled the industry to new heights, making recruitment one of the to-watch industries in the world of technology.”

Relieving routine

For now, AI is already changing the way things are done by relieving HR professionals of time spent on routine and time-consuming activities such as filtering through thousands of résumés. AI is also creating an efficient way for recruiters to interact and work with candidates and clients, including screening, shortlisting, sourcing, and creating job adverts based on key words, using chatbots to provide assistance to jobseekers in real time and even using predictive analytics and machine learning to generate impactful client and candidate insight.

However, for the industry as a whole, sophisticated adoption and development of AI in the recruitment space would mean a change in economies of scale similar to what we have seen in other industries such as music, news or retail with the rise of the likes of Taobao and Amazon.

A much larger scale

Where once upon a time, operations could be effected manually and a company could still stay ahead of the competition, with the introduction of AI, a company can now operate on a much larger scale while recruiters can focus their time on higher impact activities such as standardising the job matching process to increase the quality of hire, collecting data to identify trends and adjust strategies, as well as freeing up time to determine the candidate-client culture fit.

Recruiters say AI has already changed the game significantly.

“It allows us to find candidates quicker, more effectively, across all the sectors we are dealing with, with one of the biggest advantages being that we recruit in many different sectors and the technology overlays across all of those, and we are simply able to get to market quicker,” says Dean Stallard, managing director of recruitment firm Hays Hong Kong and South China.

Reap the dividends

And this is where the company that makes the right investment into AI might see a winner-takes-all situation.

“So if your competitor does that first, they might end up eating up the entire pie, which is what we have seen in other industries, and because many players reacted too late, they now find themselves sidelined, or acquired, or going under,” says De Kai, a professor of Computer Science and Engineering at Hong Kong University of Science and Technology, as well as being a  distinguished research scholar at ICSI, Berkeley.

This could, in fact, be one of the biggest disruption that AI might have on the industry by sidelining the smaller players or those who have come too late into the game.

A people-oriented business

However, while it can’t be argued that the benefits of AI in the recruitment process are limitless for both the recruiter and the jobseeker, industry professionals still say that, ultimately, recruitment remains a people-oriented business, and AI might not always work out for certain elements of the recruitment and hiring process.

For instance, O’Brien says that candidates or clients may not like talking to a bot as they might feel like that are not being valued.

“This could have a negative impact on the business, especially in Asian cultures where people still much prefer the human touch,” she says.

Another area where AI might not be able to replace the recruiter is in detecting human nuances and building trust with a candidate.

Stallard talks extensively about this, saying that while some AI technologies are starting to focus on soft skills, they can’t assess humour or an obscure culture fit.

Building trust

“At the end of the day, recruitment is about building trust – it’s about building trust with your client and building trust with your candidates and AI can’t really do that, at least not now,” he says.

Of course, other areas in which AI might fall short are its inability to identify, prevent or manage conflict or where privacy infringement might be an issue. AI might also be vulnerable to external attacks or be unable to address a negative customer experience due to its inability to respond to queries or requests outside of what it has learned.

But regardless of the potential pitfalls, AI is here to stay. And although Hong Kong ranked seventh in the region for AI preparedness in a recent study conducted by the Asia Business Council, the government continues to pledge its commitment to building Hong Kong as a comparable technology hub with billions being ploughed in to help develop the industry.

So where does the future lie for AI in the recruitment industry?

According to some, the biggest development will likely be in accurate matching, and this could very well be the game changer, according to Professor De Kai. Using early search engines as an analogy, he notes that the early players were seen as big gorillas even though the return on searches were at best random. Then came Google as a game changer with a different kind of machine-learning algorithm where search results were much more on point, subsequently wiping out the competition.

A chance to clean up

“Right now I don’t see fantastic matching and performance happening right now, but I do believe that someone is going to get it together and actually attract the top AI talent and attack this problem and they’re just going to clean up,” De Kai says.

So the million dollar question becomes: should all recruitment companies jump on board the AI bandwagon?

The consensus is that it depends on the company’s objectives and priorities. AI technology can do a lot, but there is always a risk that it might not work out. Companies new to the technology should always ensure a constant feedback loop between the AI technology and the project team to ensure that opportunities are being identified and acted on early, and that loopholes are being plugged.

“Having in place a robust implementation and evaluation process will ensure the best leverage and use of the AI tool,” O’Brien says.