AI is changing how workplaces operate on a global scale. What was once limited to automating tasks now provides employers with useful insights into workforce behaviour and performance. At present, there are two crucial manpower components where AI is being utilised – employee engagement and performance management. In this article, we’ll discuss how this works and how it affects PMS. Let’s begin.
Understanding AI and Its Role in Employee Engagement
AI is now widely being used for its ability to perform tasks that conventionally required human intelligence. Because of its language processing and machine learning capabilities and access to data analytics, AI can now make decisions, solve problems and even develop creative materials.
In terms of employee engagement, AI makes raising and addressing concerns easier for both the employees and the company. Here are some innovations that allow AI to contribute to employee engagement.
Tools and Technologies Used for Employee Engagement
HR Inquiries Through Chatbots: Although employees in much smaller companies can simply go directly to Human Resources, the same cannot be said for bigger corporations. In these cases, if HR will manually answer all benefits, policies, or pretty much any HR-related questions, it will take so much of their time and energy to do so. To improve efficiency, chatbots can be used through various communication channels for convenience and timely reception of accurate information. Think of it as HR’s triage team.
Sentiment Analysis Tools: These tools allow employers to measure employee morale and their engagement through email, chat messages, and even survey responses. The beautiful thing about this is that it is usually able to identify problems that aren’t always apparent because they do not cause direct issues for the company.
Personalised Learning and Development Programs: AI makes creating custom development plans easier to accomplish. By collecting and analysing performance data and personal preferences, AI can match interested individuals with corresponding courses, training modules, or development activities that impact their personal and professional aspirations.
AI’s Impact on Performance Management Systems (PMS)
A Performance Management System or PMS usually refer to manual assessment and reviews which we all know are prone to personal biases. Moreover, they are exceptionally time consuming for those facilitating the assessment and those undergoing them. However, perhaps the biggest disadvantage of a PMS is its inability to provide real-time feedback. This means areas of improvement can remain ignored for longer than necessary. The same goes for achievements that should have been recognised as soon as they were done.
Now, an AI-assisted PMS can be made more effective through the following.
Automated Performance Tracking: There are usually multiple data sources used to evaluate and monitor employee performance. There are project management tools, communication platforms, and more. When information is updated and handled by AI, there will be little to no delays, so whatever metrics you’re measuring will be given timely assessments without having to be passed through several people or departments.
Data-Driven Insights and Analytics: Unless someone is dedicating their time to carefully analyse a vast data set, there’s a chance that several patterns, correlations or even trends can go unnoticed. AI removes this issue because of its high-speed capability to access and process a large amount of information. If you need to identify the best performers, spot skill gaps, or even predict future performance based on historical data, a well-programmed AI can make it possible. For instance, an AI can pinpoint which employees are likely to leave using information fed to it and make recommendations on how to keep them.
Examples of AI-Driven PMS in Action
Company A – Performance Reviews With AI: Company A recently implemented an AI-driven PMS that integrated seamlessly with its current tools, which collected employee data detailing their activities and actual/predicted results. The AI system used the real-time dashboard to generate results to be forwarded to managers. These files included individual and team performance metrics that led to more meaningful feedback sessions. This data set was also the basis of how frequent these sessions should be.
Company B – AI-Driven Employee Development: Company B started using AI to analyse employee skills so they can be matched with appropriate training resources. This not only applied to skill gaps. This AI system also identified exceptionally performing employees and zeroed in on their strengths so they could be fostered and rewarded. This significantly improved employee development and satisfaction. The new technology was also created to provide notifications on which individuals are ripe for promotion due to their achievements and contributions to the company.
Company C – AI Predictions for Employee Retention: Company C is an organisation that recently adopted AI in its performance management process. The AI implemented was designed to track which individuals were likely to leave the company in under a year’s time. It uses predictive analytics to identify employees at risk of leaving, allowing the company to proactively address their concerns and improve retention strategies. Factors that were taken into consideration included tenure, sudden performance dips as well as low engagement scores. Once the data was available, HR was able to mitigate the issue and proactively address their concerns. Attrition rates were kept down through this initiative.
Challenges and Considerations for Implementing AI in PMS
When used in PMS, AI is a great tool that creates an environment that’s conducive to learning and improvement. But like any other innovation, it does not come without disadvantages. Here we discuss the most common issues that arise from the use of AI in PMS.
Data Privacy and Security Concerns
The large amount of data that AI processes means a large amount of sensitive information. A company cannot and should not invest in AI without investing in data security. Although the priority is to create a better process for the organisation, protecting information from misuse and breaches should not be taken lightly. Good thing that there are regulations and tight cybersecurity protocols in place to ensure compliance so that employers can maintain their employees’ trust at all times.
Ensuring Unbiased AI Algorithms
One of the biggest issues when using AI in PMS is ensuring algorithms remain unbiased. This is easier said than done, though, as AI usually just learn from provided historical data. This means that ‘tarnished’ data can lead AI to amplify this bias further. To prevent this from happening, companies using AI in their PMS must train their AI systems and perform regular audits to ensure fairness at all times.
Change Management and Employee Buy-In
Integrating AI into existing PMS is already complicated. The process becomes even more complex when changing management. It’s not uncommon for employees to feel untrusting of new technologies and their impact not just on the company but also on them as individuals. Any organisation that wishes to make the transition should ensure that it stays transparent as it makes the switch and involves everyone through the implementation process. This way, any imminent concerns are effectively raised, assessed, and addressed.
Long-Term Benefits and Potential Risks
The long-term benefits of AI in employee engagement and performance management are substantial, including improved productivity, higher employee satisfaction, and more effective decision-making. However, potential risks like those mentioned above must be carefully managed. Continuous evaluation and adaptation are essential to mitigate these risks and ensure that AI implementations deliver their promise.
The Future of AI in Employee Engagement and PMS
AI proves to be a formidable force for improving employee engagement and utilisation of PMS. This technology is expected to enhance more areas in any work environment to provide various opportunities for growth and development. Currently, we are seeing a trend that could potentially lead to the following.
AI-Driven Coaching and Mentoring: AI can provide personalised coaching and mentoring, using data to offer tailored advice and development plans. This approach can help employees achieve their career goals more effectively.
Gamification of Performance Management: Integrating gamification into performance management can make the process more engaging and motivating for employees. AI can facilitate this by creating personalised challenges and rewards based on individual performance data.
Strategic Steps to Leverage AI Effectively
AI is a powerful technology that organisations can use to change their approach towards employee engagement and performance management. These are some steps that can be taken to maximise AI’s potential in employee management and PMS.
Invest in the Right AI Tools
Companies need to first determine their needs before they start looking for appropriate AI solutions. If you have no idea where to start, there are several vendors you can contact for guidance. Whether you need predictive analytics for employee performance, personalised training plans or automated feedback systems, a reputable provider should be able to provide you with what you need. Ensure these systems are scalable and secure for your business and your employees’ protection.
Train Your HR Teams on AI Applications
Successful implementation of AI will be difficult if none of your HR team understands how it works. Your team should undergo comprehensive training to fully understand these AI systems, how to interpret the data collected, and how to always stay ethical when using AI. It will also benefit the company if your team can troubleshoot basic issues.
Continuously Evaluate and Improve Existing Systems
If you want to use AI to its fullest potential, you need to regularly evaluate and refine your existing systems. Periodic audits help identify areas for improvement and determine whether the current setup still aligns with the company’s goals.
Conclusion
The integration of AI into employee engagement and performance management systems holds transformative potential for organisations. By improving decision-making, enhancing productivity, and fostering a positive work environment, AI-driven solutions can significantly impact organisational success. As companies navigate the challenges and opportunities presented by AI, they are encouraged to explore and implement these innovative technologies. The future of work is here, and AI is at the forefront, driving meaningful change and improvement across the board.
Author: Marc Bartolome – Head of Business, SEO Services Australia
Photo credit: StockCake
