Artificial Intelligence’s Impact on the Workplace By Goldman Sachs

AI

How is artificial intelligence shaping the workplace of the future? At the Ayco InnerCircle conference, which brings together practitioners and thought leaders in the human resources industry, Goldman Sachs’ Joe LeRoy of Ayco’s Institutional Business Solutions spoke with Richard Hughes of UnitedHealth Group, Jeffrey Howell of Panasonic Industrial Devices Sales Company of America and Brian Marcotte of the National Business Group on Health about the role of AI in their businesses.

Joe LeRoy: AI is having an outsized impact on companies’ human resources departments. According to PwC, about 63% of companies are rethinking the role of their HR department in light of AI’s impact. Just how pervasive is it?

Jeffrey Howell: From a standpoint of AI, I think the best word that comes to mind would probably be “inevitability.” It is coming whether we like it or not. In 2019, according to one industry stat, an estimated $30 billion to $40 billion will be spent on AI technology in 2019 – that’s up about 40% from last year.

Richard Hughes: In its current state, AI would be better described as “augmented” intelligence where human engagement is still needed in order for AI to reach its potential. AI is not currently capable of the creative, imaginative thinking we associate with the human mind. Rather, we see it as a system for ingesting human engagement and driving outcomes based on observations.

Brian Marcotte: When I think about AI, it’s more of an umbrella term that encompasses machine learning, deep learning, natural language processing and other methods to reach smart decisions. It’s behind a lot more of what we do and see. In healthcare, for example, it’s everywhere. AI is being used in back-end administration, wearables and are helping to steer people to the right physicians. It will revolutionize how healthcare is delivered. But having said that, the level of change in health care is far outpacing the localized and fragmented delivery system’s ability to keep up. While there are emerging remedies to integrate these fragmented services, including better data integration and more predictive analytics and actionable messaging to patients, we are in the early stages and they are far from mature solutions.

Joe LeRoy: Given AI’s ubiquity, can you talk about how it’s affecting your recruiting and people strategies?

Richard Hughes: AI is already helping our HR professionals at UnitedHealth with employee selection and advancement. We’ve been using AI for more than three years in our recruiting practice to help connect an applicant’s profile with job openings. But we’re seeing more potential in applying AI to understand our own workforce. For example, we’re applying AI algorithms and leveraging the science of our leadership database to identify the characteristics and profiles that make a great leader. This will allow us to identify and groom future potential leaders earlier in their careers. We’ve also developed methods for assessing flight risk potential through the data points that trigger turnover, giving us time to introduce proactive solutions to help mitigate attrition.

Joe LeRoy: Jeff, as head of Panasonic’s industrial sales business, how is AI impacting the business side?

Jeffrey Howell: The amount of data that we’re getting is permeating every aspect of our business relationships. And data is what’s driving the core of AI by giving us the ability to project, interpret and predict. We’ve been using AI with some of our business partners to obtain more cost transparency and fine-tune our pricing models. We’re also using similar predictive analytics to enhance our ability to introduce new products to the market. Historically, we’ve introduced about 20 new products a year. Next year, we’ll launch 140 new products because of AI.

Joe LeRoy: And we can’t talk about AI without addressing its potential to replace jobs. How are you viewing the impact of AI on the future workforce?

Brian Marcotte: In the future, AI will significantly transform many job functions, particularly in the administrative space. Some people are going to lose their jobs in the short term, but over the long term, AI has the potential to create more jobs. We need to reskill and redeploy those people who will be negatively impacted by AI and focus on ways to upskill and develop future workers in the necessary skill sets.

Jeffrey Howell: AI is not only automating many of the manual processes, but it’s also reducing operational efficiencies. If you want to look at ways to take advantage of AI, my advice is to put someone in place to take advantage of your data, such as a chief data officer.


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