The Rise of Intelligence in Talent Acquisition and Retention
Intelligent solutions have the potential to transform the way companies execute and analyze hiring activities
Few areas of human capital management (HCM) are as closely tied to the measurement of HR’s success as talent acquisition and retention. In a recent SAPinsider survey of SAP HCM and SAP SuccessFactors customers, two key talent acquisition and retention metrics – employee retention rate (38%) and time-to-hire (36%) – were identified as top measures used by respondents to evaluate the success of their human capital management business processes. As HR looks to improve key performance measures related to talent, new help is available in the form of intelligent technology.
How AI and Machine Learning Can Help Bridge the Talent Gap
While there are many current uses cases where AI-based solutions are starting to deliver value across HCM, recruiting is one function that has seen early benefits from the technology. AI and machine learning are being used in SAP SuccessFactors Recruiting (particularly in the Job Analyzer) and in innovative partner solutions from companies like Eightfold to deliver additional insights that can help improve the quality of hires, increase the quality of the talent pool, and reduce time to hire. For example, AI and machine learning in Eightfold’s solutions can be used to reduce the risk for unconscious bias in recruiting processes by hiding irrelevant personal information and only giving hiring managers the information that is necessary for the position being filled.
AI-based solutions have the potential to enable employers to build larger, more targeted talent networks from which to source both external and internal candidates. From a retention perspective, AI has the ability to more effectively identify matches for promotions and internal job opportunities from existing talent by predicting a candidate’s ability to perform a particular skill or succeed in a specific role. The result could be better opportunities for existing talent to advance and the opportunity to reduce both turnover rates and cost to hire.
Optimizing Outcomes for Employers and Employees
SAPinsider recently spoke with Kamal Ahluwalia, Eightfold’s president and co-author of What’s Next For You, a book that outlines how advances in AI and machine learning are transforming talent acquisition and retention. Ahluwalia says that a strength of AI is its ability to better empower candidates and employees to find a job or career path that meets their aspirations. This occurs, said Ahluwalia, when enterprises align their own objectives with the aspirations of their employees and AI helps make that analysis and alignment happen.
Customers who have already leveraged intelligent technology in both talent acquisition and retention activities have recorded significant increases in efficiency and decreases in costs, according to Eightfold. The measurements reported by Eightfold customers after the introduction of the technology (shown with the customer’s industry) included:
- 80% reduction in recruiter time (finance)
- 50% increase in positions assigned per recruiter (technology)
- 35% reduction in time-to-hire (consumer packaged goods)
- 20% increase in hires from career site (technology)
- 47% increase in female applicants (professional services)
- 19% increase in hiring of female candidates (telecommunications)
- 81% increase in internal hiring (telecommunications)
- 25% decrease in attrition of strong performers (technology)
AI and machine learning is likely to continue to revolutionize talent acquisition and retention over the coming decade, according to Ahluwalia. “We will see the walls between hiring, retention, and contract workforces crumble in front of our eyes,” he said. “People want more flexibility in what they work on and how companies provide visibility and agility for employees and contractors will become table stakes.”
What Does This Mean for SAPinsiders?
AI and machine learning have the potential to allow HR to significantly improve key metrics around hiring and employee retention and provide the insights needed to build a higher quality talent pool. To maximize the value of their talent acquisition and retention practices and investments, SAPinsiders should:
- Focus on building their own talent network. As Ahluwalia noted, mature organizations should have a talent network that is roughly 200 times the number of its employees. Focusing on practices and technologies that increase the size and quality of your talent network can dramatically improve your access to the right talent, reduce time to hire and cost to hire, and boost critical retention and diversity benchmarks.
- Make talent transformation part of your digital transformation stream. Most companies today have begun or are planning digital transformation efforts, but few are focusing on the talent required to execute the transformation. Companies should be developing personalized plans for each employee to identify the skills and potential required to drive their transformation projects. AI-based solutions can help do this in less time and with greater efficiency.
- Get serious about diversity and inclusion. Eightfold reports that its customers have 47% more female applicants for their open roles due to AI-powered matching and full transparency that eliminates unconscious bias. AI-based talent solutions are very good at predicting which individuals can learn new skills and which have the potential to play a bigger or different role — and they do it without bias.
Following this strategic guidance should help SAP customers understand some ways they can optimize their talent acquisition and retention efforts to increase the size and quality of their talent network while reducing cost and time to hire.