Using HR Predictive Analytics in Talent Retention

Abstract: Predictive analytics uses multiple techniques and statistical methods to help determine future outcomes based on historical data. Although established years ago, it is a growing trend in Human Resources (HR), especially by lessening employee turnover and increasing retention. As of April 2022, 4.4 million people voluntarily had left their jobs while there were 11.4 million job openings (U.S. Bureau of Labor Statistics, 2022). Employee retention is important to HRD professionals and for the financial wellness of organizations (Mizar, 2018). This poster presents the shortfalls and advantages of using AI in HR.
Shortfalls and Advantages of AI in HR
The use of AI in organizations presents several shortfalls (Duggal, 2022). First, creating a machine/program that simulates human intelligence and frequently updating the software is costly (Simplilearn, 2022). Second, AI is capable of learning over time with pre-fed data and past experiences but it cannot be creative in its approach. Third, AI is slowly replacing several repetitive tasks with bots, hence eliminating many job opportunities. Fourth, ethics and morality are important human features that can be difficult to incorporate into AI (Korolov, 2022). The rapid progress of AI has raised several concerns that AI will grow uncontrollably, also called AI singularity. Fifth, with the use of facial recognition, iTutorGroup automatically programmed its software to reject certain individuals. Also, AI cannot address a toxic work culture (Korolov, 2022). Finally, the technology that creates algorithms for software programs, automated decision system (ADS), is contributing to HRD professionals’ dependence upon technology and it is not common knowledge within Human Resources (Lazzarotti & Yang, 2022).
Yet, predictive analytics uses data to forecast trends and change organizations to improve production, sales, and, ultimately, operational costs. When predictive analytics is combined with AI, the insights gained from these advanced systems will be the key to future more accurate and timely forecasting (Forbes, 2022). AI has become essential to the field of HRD as it presents major opportunities in enhancing its functions.
In March 2019, Gallup reported that employee turnover in the U.S. costs businesses one trillion dollars and that 52% of employees who leave their positions voluntarily say the company could have done something to keep them (Gallup, 2019). Using AI to point out these employees could mean a significant saving in time and money. Gallup also indicates it can cost up to 105% of an employee’s annual salary to replace them. Under the mediating influence of big data and predictive analytics, the various HRD initiatives significantly contribute to enhancing retention (Belal et al., 2022). Well-balanced work life is crucial for employee satisfaction, which results in lower employee turnover and employees who customize their work schedules tend to be more efficient and productive (Engholm, 2018) and AI can assist with both.
Successful examples of AI in HR
KPMG’s AI program can predict two-thirds of workers who intend to leave their employers. Based on this available information, they can keep 10 to 20% of those employees from leaving (Korolov, 2022). Companies such as Genpact use an AI chatbot that gauge employees’ moods. They found that employees who are willing to use the program are significantly more likely to stay with their employer and that certain types of communication behavior can indicate an employee’s desire to leave (Korolov, 2022). AI identifies skills gaps and recommends training that might improve employees' performance or prepare them for a higher-level position (Sweeny, 2021). Millennials and Gen Z workers prefer new and challenging work, and AI can track progress and alert managers when it's time to introduce new skills, duties, and/or training (Sweeny, 2021). AI also helps monitor the volume of work employees do and can spot burnout before it becomes an issue (Fatemi, 2020). From an administrative standpoint, HRD professionals can use AI in customized scheduling, creating a system where employees can choose their schedule from a set of options that work best for them. This saves time and money and makes the process easier for employees (Engholm, 2018). Overall, one of the most valuable advantages of AI is its impact on turnover. According to a 2021 survey conducted by Workplace Intelligence and Oracle, 82% of more than 14,000 employees and managers worldwide believe AI can support their careers better than humans (Korolov, 2022).
Conclusion
Even though using predictive analytics for talent retention has proven itself to be valuable to HRD professionals, it still needs research and improvements. Before organizations embrace the use of AI, they should ensure the software's inner workings (Gonzales, 2022), and ensure that it fosters integrity and inclusivity.