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The rise of technology is prolific and will only gather momentum over the next few years. This will impact and shape people management in the future. With no clear consensus about artificial intelligence’s ultimate impact on the workforce, we explore what organisations should be considering now to future-proof their HR strategy.

Occupying the middle ground

Already, the effect of artificial intelligence (AI) is that job polarisation is increasing. The growing demand for low and high skilled jobs has resulted from AI occupying the middle space, as technology generally displaces mid-skilled roles. This creates both opportunities and threats in the workplace. The potential return on human capital has never been greater, even though technology is taking over certain jobs.

A PwC study ‘Rise of the Humans 3’ has recently estimated that UK GDP could be up to 10 per cent higher in 2030 due to AI, equating to an additional £232bn. In addition to economic advantages of capitalising on technology, AI can also support individuals, freeing up their time to do the more strategic and creative elements of their day-to-day work. Automation can take on the responsibility for a vast array of tasks, such as white-collar automation that is beginning to complete calculations in HR and legal departments.

According to Kevin Green in ‘Competitive People Strategy: How to attract, develop and retain the staff you need for business success’, people’s ability to generate value is at an all time high. Traditional roles that are labour intensive, such as those across the workforce at GM mean that the return on human capital is lower (the market capital per GM’s 118,000 employees is $298k) as opposed to technology companies such as Facebook where the market capital for each of their 25,000 employees is $21m.

Long-term planning

To fully harness the opportunities in machine learning and AI, the key is to identify the possibilities that the rise of technological support creates in the long-term.

In its report, ‘A Future that Works for Working People’, the TUC notes that economist John Maynard Keynes had predicted 90 years ago that we would be benefitting from shorter working weeks. This prediction was based on the rate of acceleration of technological advances and the opportunities these presented in freeing individuals from mundane, repetitive tasks inherent in most roles.

Technology is proving more of a double-edged sword, which can be used to empower people, and enhance their work-life balance as Keynes envisaged, or to monitor and control their activity. A carefully managed transition is required to ensure that certain roles are not eliminated or displaced which may exacerbate gender, age or ethnicity inequality in the workplace. Therefore having policies around how AI can be used to propel efficiency in an ethical way is important to using this to unlock the potential in your workplace.

Keeping the ‘Human’ in ‘Human Resources’

There is a lack of consensus around what AI means for jobs. According to KPMG, 60 per cent of HR leaders believe AI will lead to fewer jobs, whereas 62 per cent of Chief Executives predict that it will lead to more jobs being created than eliminated.

This is also likely to vary by sector. Partial automation is currently more accepted in society, as we have seen with supermarket checkouts where there is a mixture of self-checkouts and staffed checkouts. Full automation is currently less likely in sectors such as dining, retail and bars where a level of human interaction is expected and customer experience makes up a significant cornerstone of successful business’ brand.

However, with repetitive day-to-day tasks such as payroll systems or in manufacturing where robots could be doing the job with the right investment levels, AI poses a greater risk to the workforce. More AI-centric roles and training programmes need to be offered to future-proof the workforce to transform this into an opportunity for individual growth.

Furthermore, the blurring of role functions between people and machines is likely to lead to Chief Information Officers and HR Directors working closely together to manage resources; driving productivity throughout the organisation can unite their common aims.

What does this mean for the future of HR?

As the boundaries between the skills-based functions and capabilities of machines and people meet, HR needs to ensure that its recommendations and insights are evidence-based to keep pace with the data-driven insights that automation and AI can provide.

Individuals are at the heart of HR. Ensuring that organisational design supports employee engagement and taps into individual success sets the tone for the whole organisation. With a growing number of consultancies and technological businesses offering AI support, consistent feedback we receive from customers is that systems and software are only as good as the individuals operating them. Organisations must equip people to get the most out of the technology available and use these outputs intelligently.

Creating a culture that is objectively fair and agile in its response to workforce transformation will help meet the challenge of automation in the near future and mitigate the risk of roles being displaced. More AI-centric training and forward-planning will equip the workforce with exciting tools to drive innovation and productivity in the future.

Get in touch today to talk about organisational design and how to accommodate AI in your workplace.

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