Impact of Artificial Intelligence on Organizational Transformation. Группа авторов
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Intelligence is a branch of computer science dealing with the simulation of intelligent behavior in computers.”
According to John McCarthy, AI is “the science and engineering of making intelligent machines, especially intelligent computer programs” [22]. AI simulates intelligent behavior in computers. In ML, the machine learns on its own based on patterns and training data sets. It enables machines to process like the human brain.
It is revolutionizing various industries. The study conducted by Xaxis [35] concluded that AI will be the next industrial revolution. The economic impact of AI is estimated to reach 13 trillion dollars by 2030 [7].
A survey conducted by Deloitte on 250 executives on the benefits endowed by AI revealed that 51% of the executives were of the view that AI enhances the features, functions, and performance of the product, 36% of the employees were of the view that AI optimizes internal business operations, 36% of employees indicated that AI frees up the workforce to be more creative by automating tasks, 35% indicated that AI assists in making better decisions, 32% of the employees revealed that AI helps in creating new products, 30% of employees suggested that AI helps in optimizing external processes like marketing and sales, 25% of employees were of the view that AI helps in pursuing new markets, 25% revealed that AI helps in capturing and applying scarce knowledge where needed, whereas only 22% of employees indicated that AI reduced headcount through automation [9]. Figure 1.1 depicts the benefits endowed by AI on organizations. Thus, it can be seen that no aspect of management has been left untouched by AI. AI is gaining prominence in various managerial functions like HR, finance, and marketing. AI brings with it personalized experience.
A study carried by Oracle and human resources advisory and research firm, Future Workplace revealed that 80% of Asia Pacific (APAC) countries surveyed indicated that 50% of their employees are currently availing AI in some or the other form in their organization. The results also indicate that 77% of employees in China and 78% of employees in India have adopted AI which is more than double the 32% in France and 38% in the United Kingdom [23].
Figure 1.1 Benefits of Artificial Intelligence. Source: Deloitte 2017.
1.2 Research Methodology
The study is exploratory in nature. The researchers have explored various studies on the role of AI in the various functions of HR and marketing.
1.2.1 Research Objectives
1 To explore how AI disruption is revolutionizing HR functions.
2 To explore how AI disruption is revolutionizing marketing functions.
1.2.2 Data Collection
The study is based on secondary data, sourced from various databases like Ebsco, Google Scholar, and ProQuest.
1.3 Artificial Intelligence in HRM
Research suggests that biasness creeps in when humans are assigned the task of hiring, promotion, performance appraisal, compensation, etc. For instance, racial discrimination occurs when humans are assigned the task of hiring [29]. Another study conducted by Mckinsey and Leanln revealed that entry-level women faced discrimination during the promotion as against their male counterparts [20]. Employees also face discrimination during performance appraisal on grounds of their age [33]. Research also suggests that women face discrimination while receiving compensation and promotion [18]. AI helps in overcoming such biasness. AI is used in all the aspects of HRM like recruitment, engaging the applicants and the employees, orientation, onboarding, performance evaluation, training, compensation, and employee retention. These aspects are discussed below in detail.
1.3.1 Recruitment
As against the traditional recruitment process, recruiters are now using chatbots that are powered by AI (ML) [10]. Chatbots use natural language processing to facilitate real-time interaction with the applicants through skype, email, social media, etc. They are useful in gathering a pool of information from the applicants regarding their competencies, qualification, and experience and can even generate their profile, based on the information gathered. They are programmed in such a way that they can comprehend written and oral communication and can address routine queries of the applicants appropriately. Furthermore, these chatbots are efficient enough to even prescreen potential job applicants by matching their competencies, traits, experience, culture fit, etc., with the open positions and can schedule an interview for the applicants. With the advent of AI in recruitment, the hiring process has become faster as it can auto-screen thousands of resumes in a minute which are free from biases. Examples of various chatbots used by organizations are a) IBM Watson Recruitment, b) Jobs Intelligence Maestro of DBS Bank, which has successfully decreased the time involved in screening per candidate from 32 minutes to 8 minutes [26], and c) Mya, which provides 24/7 support.
1.3.2 Engaging the Applicants and Employees
Earlier, when AI was not introduced in HR, engaging the employees was time-consuming. Now, various software backed by AI like chatbots and Applicant Tracking System can engage the applicants by addressing their routine queries on a real-time basis and update them regarding their current status. The striking feature of these chatbots is that they become robust and smarter with every interaction. Example of engaging the applicants: IBM uses Watson Candidate Assistant (WCA) to engage its applicants in personalized conversation and also suggests the job positions that resonate with their competencies and experiences in which they can excel. Such engagement is a win-win situation for both the applicants and the organization. The applicants feel delighted and the organizations also become free from committing costly hiring mistakes.
Example of engaging the employees: AI-backed Amber chatbot, which is used by Oyo, Marico Ltd., and many more, is instrumental in identifying disengaged workforce in the organization. Thus, the organizations can take measures to engage the disengaged workforce.
1.3.3 Orientation and Onboarding
Organizations organize orientation programs for acquainting the new joiners regarding the organizational culture, rules and regulations, employee benefits, etc. According to Miller, nearly 90% of the new joiners tend to miss some or the other details during the orientation program [27]. The organizations can overcome this problem by using chatbots that can answer all the queries of new joiners which they might miss during the orientation program.
The AI-backed programs are enhancing onboarding programs as well. With the help of chatbots, the newly joined employees can get all the information regarding whom to report, their team members, what work is assigned to them, etc. Example: Amber is a chatbot that is used by Oyo, Marico Ltd., and many more. Mr. Amit Prakash, Chief HR Officer of Marico Ltd., emphasized the importance of Amber in the onboarding process in Marico Ltd. He said, “When employees join us at different locations, the supervision for onboarding employees has to be better. On the day of joining, the new members are taken out for lunch with the supervisor. For me to get into that detail is difficult. Amber helps to manage this information with little effort” [1].
1.3.4 Performance Appraisal
Performance appraisal deals with gathering, analyzing, and assigning numerical values and grades to the performance of the employees. The numerical values and scores assigned by human beings for evaluating the performance may not be precise. To overcome this issue, the fuzzy logic approach is used for evaluating the performance of the employees. A study which employed hierarchical fuzzy influence approach, indicated that reasoning based on fuzzy models are more