Transforming Performance Management with Generative AI
Unlock HR’s potential with generative AI for transformative performance management.
Cheryl Porro of Betterworks explores the game-changing impact of Generative AI on HR performance management and the path to a more equitable, agile, and empowered workforce.
Let’s face it: Human resources professionals are inundated with technology solutions to solve problems, with some working better than others. From applicant tracking systems, human resources information systems, and employee engagement software to onboarding, benefits, and payroll technology, the list is endless regarding streamlining and enhancing organizational processes.
However, one HR technology solution has failed since its inception in the 1920s: performance management software. That’s because it’s built on faulty ground, the misguided belief that a militaristic model of hierarchy and control form the best basis for managing collaborative teams toward business outcomes and, understandably so, is universally hated. Most HR leaders and employees will lament the bureaucratic process when completing the much-begrudged annual performance review. HR professionals and employees know it’s dreadful and doesn’t change performance.
Time for Change: As Work Dynamics Evolve, So Should Performance Management
Fast forward to today, over 100 years later, and work has radically changed. Performance management, however, still needs to be improved and more effective. They do it to check the box without a true grasp on why they do it other than because that’s how it’s always been done. We know that the evolution of performance management processes is imminent to create a happier and more productive workforce.
We also know that this said evolution required to transform workforces just got more interesting – as what might be the most transformational technology of our time, generative AI, promises to impact the interaction between humans and machines fundamentally. The buzz surrounding AI and how it will affect our work cannot be ignored. There is a vast opportunity in front of us— especially HR leaders.
See More: The Best Way to Improve Performance Management Data
AI and HR Transformation: Generative AI Is Poised to Reinvent Performance Management
The hype cycles in technology are aplenty. You might think that AI is just another industry fad and that the passionate conversations around us will die down soon, but these conversations have happened for the past decade. The technology is just improving at a quick rate, adding to its virality this time around. While the initial excitement may fade, AI integrations into everyday performance management processes will become the norm. For HR leaders, we’re entering an important time where we can leverage its benefits to enhance employee experiences and, as a result, drive stronger business outcomes.
I’m optimistic that generative AI is well on its way to helping HR teams transform workforce performance by doing things like detecting and eliminating unconscious bias from the performance evaluation process, boosting goal quality, encouraging goal achievement, simplifying the arduous process of conducting performance reviews, prompting timely recognition, providing tailored coaching suggestions, and much more. It will help employees work faster, smarter, and more productively. It will help managers in becoming better managers and coaches.
Practical Magic: How Managers Can Implement AI to Become More Effective at Cultivating Talent
With the help of AI, managers, in particular, are positioned to become more effective and efficient at cultivating talent by understanding their talent pool, what skills they have, and where the gaps lie. With these added insights, managers can do more for employee development in recognizing wins, automating 1:1 check-ins, suggesting skills development areas where the organization is comparatively weak, or matching employees’ career development goals with available opportunities.
If we leave it to AI to get it right regarding strengths, weaknesses, skill sets, building relationships, and connections, it won’t work. AI could and is likely to get it wrong. The combination of human intuition and AI makes it exceptionally powerful. This has to be a partnership governed by the human responsible for the people.
The human element of the performance process doesn’t go away:, with the assistance of AI to streamline more administrative tasks, one could argue that it’s enhanced. Imagine a day where the manager has a complete perspective on the employee’s contribution to goals without digging around to find scraps of incomplete information. The manager spends more time understanding the data, seeing recommendations on how to help the employee, and ultimately decides the right coaching. What is the priority? How does the person need to hear this? How does this connect to other things I know that are going on in the person’s life? A manager’s EQ is not replaceable, and with the power of generative AI, they are given insights at the moment it matters to drive meaningful conversations.
It’s becoming increasingly clear that AI is rapidly becoming a necessary staple, inside and outside of HR, because it can also do rote, repetitive tasks much faster and more accurately than humans. It’s accelerating productivity. Resisting it puts your organization at risk of falling behind. However, its benefits cannot be discussed at length without also addressing the perceived risks of AI that linger quite heavily: proprietary information leaks, sources being unknown, copyright infringement, plagiarism, making the workplace less human, lack of critical thinking, too much similarity across content where variety and specificity is essential (i.e., feedback and performance reviews), and the widespread concern of unconscious bias.
Thoughtful change management, which includes communicating these benefits and risks, is essential in the company-wide adoption of AI. Organizational leaders are wise to consider what can go right and wrong with the technology so that guardrails can be put in place to ensure governance, privacy, and security before these changes are implemented. Without an effective change management plan, organizations can stifle their ability to use this technology effectively, even as deceivingly simple as ChatGPT.
See More: 3 Steps To Better Mitigate Bias in Your Data Analysis
The Path Forward: Embracing the AI-HR Convergence One Step at a Time
HR leaders can start by implementing small-scale pilot projects to demonstrate the value and feasibility of AI within performance management processes. They can also encourage employees to jump in with low-risk use cases of generative AI. Tell employees what you’re doing, how you’re approaching it, and what opportunities there are for them to make it a success. Allow employees to share their successes as they experiment with the technology. Be clear about what “unauthorized use” means. Then, memorialize it as part of a company policy.
Employees, customers, and partners will all expect organizations to be transparent about their use of generative AI and the policies in place to keep their data safe. Everyone’s appetite for AI is going to be different. Some may be asking where that “button” is to fill in information for them automatically, and others will be hesitant to trust it. We’re still in a time where employees are reacting to technology, so organizations will need the processes and infrastructure in place for them to opt in.
With open dialogue and setting clear boundaries, organizations are ready to tap into the potential of generative AI. The promise of AI might seem like another fleeting phenomenon to some, but its integration into HR practices is not just a fad; it’s a paradigm shift that will reshape the employee experience for the better. The urgency is there, and some may rush into adopting it. But more than anything, HR leaders have the chance to do it right by thinking about the end user and putting their needs first: employees. It can dismantle biases ingrained in evaluations, elevate goal-setting precision, and catalyze timely recognition. AI refines performance reviews and empowers managers to step into a new role — one of strategic coaches who guide their teams toward greater success.
The convergence of AI and HR represents a pivotal moment, a turning point in how we perceive and manage performance. Human resources leaders have a unique opportunity to harness generative AI’s potential, paving the way for a more equitable, agile, and empowered workforce. The journey may be complex, but it holds the promise of tapping into human potential, embracing innovation, and shaping the future of work for the better.
What strategies have you followed to reshape your organization’s performance management? Let us know on Facebook, X, and LinkedIn. We’d love to hear from you!
Image Source: Shutterstock
MORE ON AI IN HR
