Chapter 7

Challenges of Adopting Artificial

Technology in Human Resource
Management Practices
Aradhana Sharmaa, Dhiraj Sharmab and Rajni Bansalc
a
Gobindgarh Public College, Alour, Khanna, India
b
Punjabi University, Patiala, India
c
Chitkara Business School, Chitkara University, Punjab, India

Abstract
Introduction: AI technologies are transforming the industrial sectors, and
the impact of AI technologies does not leave behind human resource man-
agement (HRM). From recruitment to development and payroll, AI has its
own impact. In recruitment, selection, training and development, compen-
sation, and remuneration AI play an important role.
Purpose: The main purpose of this chapter is to analyse the challenges
in adopting AI in HRM. This chapter investigates the various strategies
to overcome challenges encountered by companies while adopting AI in
HR practices. Moreover, this chapter also examines the role of AI in HR
practices.
Methodology: To achieve the purpose of this chapter, various case studies
were analysed and literature studies with emphasis on what types of chal-
lenges are face in adopting AI in HR practices. The authors of various
newspaper articles, books, published journals, and websites on AI analyse
the various newspaper articles, books, published journals, and websites on
AI in human resources (HR). Electronic databases are used as the most
effective technique to begin a literature search for the current overview,
specifically Science Direct, Google Scholar, and Emerald. In addition to
this, the application of AI in HRM practices used by leading organisa-
tions globally is also reviewed. The analysis used four keywords: HRM,

The Adoption and Effect of Artificial Intelligence on Human Resources Management,

Part B, 111–126
Copyright © 2023 by Aradhana Sharma,Dhiraj Sharma and Rajni Bansal
Published under exclusive licence by Emerald Publishing Limited
doi:10.1108/978-1-80455-662-720230008
112 Aradhana Sharma et al.

AI, challenges and adopting. This research has been conducted by search-
ing scholarly papers and relevant studies using similar keywords.
Findings: The adoption of AI technologies is continuously increasing in
HR practices. AI performs various HR functions such as recruitment, se-
lection, training and development practices, scanning resume, etc. Organi-
sations can be benefitted in many ways by adopting AI in HRM practices,
such as better employees engagement and relations, accelerating competi-
tive advantages and effectively utilising HR budgeting. The findings show
that many companies like IBM, Deloitte, Amazon, etc., adopt AI in their
HR practices.

Keywords: Artificial intelligence; human resource practices; challenges;

adopting; HRM policies; traits of artificial intelligence

1. Introduction
The world is now controlled by cutting-edge technology, and individuals can
sense it all around them. A few examples are numerous technologies that bring
revolution globally, such as the internet of things, blockchain, big data analytics,
mobile apps, and AI. Intelligence may be described as the capacity to acquire and
use relevant approaches for solving issues and achieving goals in an unpredict-
able, ever-changing world. A manufacturing robot that has been pre-programmed
is versatile, accurate, and persistent, but it is not intelligent (Saleh, 2019). In 1955,
retired Stanford Professor John McCarthy invented the phrase ‘’artificial intel-
ligence’’, which he explained as ‘‘the science and engineering of constructing
intelligent machines’’. Numerous studies have disclosed that humans can design
computers to perform in innovative ways, like playing games, but nowadays,
emphasise roots that can think, at least in part, as humans. AI is a subset of com-
puter science. It is like developing a computer program to perform various tasks
which need human intelligence to perform that tasks. AI refers to the research
and development that gives a computer and its systems the capacity to success-
fully complete a job that would normally need a human’s intelligence (2017). It
is a technology that can do several tasks that require intelligence to accomplish.

1.1. Traits of AI: We Can Define AI by its Traits

⦁⦁ AI employs algorithms to uncover patterns from massive volumes of data,

allowing it to forecast and adapt.
⦁⦁ AI can supplement human intellect, give insights, and increase efficiency by
making judgements on its own.
⦁⦁ AI employs algorithms to build analytical models and is always learning.
Through numerous trial and error cycles, AI technology will learn to do tasks
using those methods.
 Challenges of Adopting AI 113

⦁⦁ AI is a technology that helps humans reassess how they study data and com-
bine information before using these insights to make better decisions.
⦁⦁ AI can move and perceive (Saleh, 2019).

AI is beneficial in various commercial activities, including helping to mini-

mise employee workload and job pressure. Rapid changes in the corporate envi-
ronment necessitate quick responses. Companies can use AI systems to inform
current performance and day-to-day operations. As commercial pressures have
grown, harsh managers have seen the value of AI in the workplace (Yawalkar,
2019). It influences the organisation and management in different ways.
Now, AI has entered the overall system of an organisation, and one of the
areas where AI has replaced humans is in the HR department, where all func-
tions in the HR department are carried out, such as applicant screening, recruit-
ment, alignment of HR activities, performance management, among others. HR
experts are concentrating their efforts today on maximising the blend of human
and automation tasks to create a simple, smooth, and instinctive work environ-
ment. It allows them to focus on their creativity, intellect, and empathy to give a
better applicant and employee experience (Verma & Bandi, 2020). The influence
of AI is expanding rapidly in HRM. The current state of AI in HR revealed
by personnel today that nearly 38% of companies have implemented AI in their
workplace (Ji-A-Min, 2017). Report by Bersin by Deloitte in which they stated
that 33% of personnel believe that their works and tasks will become argument
by AI in the coming future (JOSHBERSIN, 2017). The use of AI in HRM led to
many competitive advantages and benefitted the company. AI can improve work-
flow and increase productivity. This technology has a rapid influence on the HR
industry since it allows organisations to track and understand their employees’
behaviour patterns. Organisations are currently adapting technological advance-
ments to keep up with the increasingly complicated commercial environment. At
present, Google, Amazon, IBM, and Tesla are using AI their HR practices and
handle all the issues related to employees in innovative ways (Aspan, 2020). There
are various examples of companies that have adopted AI in HR practices. IBM
is the first company that implemented the AI in HR. Nigel Guenole and Sheri
Feinzig analyse the business case for AI in HR and their report revealed that AI
is effectively used by IBM in HR and helps the company solve various business
challenges, improve employees’ experiences, attract and develop new skills, and
make more efficient use of HR budget. They further disclosed that IBM uses AI
technologies in various areas of HR like recruitment, selection, training, com-
pensation, and career development (Guenole & Feinzig, n.d.). There is one more
company that adopts the AI in HR practices: Deloitte. Deloitte recognised the
value of AI in HR and analyzed that HR is an area where AI technologies are
lacking. So, Deloitte has adopted the AI technologies in HR, and this helps the
company in better interaction with employees, personal assistantships, and pro-
viding 24/7 support to their employees (Deloitte, n.d.).
In the coming future, AI can assist in solving the most important HRM
challenges, such as collecting information regarding employees’ performance,
feedback, participation level, and designing and executing future planning
114 Aradhana Sharma et al.

for employees. According to HR professionals, Eightfold AI’s annual report

disclosed that AI is the way to establish modern, efficient, and diverse working
practices (eightfold.ai, 2021).

2. Literature Review
AI is a notion based on the premise that the human cognitive process can be auto-
mated. AI in HRM is an emerging technology, and it is becoming a new phenom-
enon for researchers. Credric (2018) explained that AI is a branch of study that
attempts to reproduce human intellect features like thinking, reasoning, sensing,
critical reasoning, and so on, using logically directed computer programs. The use
of AI is increasing day by day in HRM practices. According to Stevenson (2019)
AI helps with the transition by enhancing the performance and accuracy of HR
functions by automating mundane tasks, enabling people to focus on develop-
ing unique talents like empathy, critical thinking, and innovation. Nevertheless, it
does not mean that AI will substitute the HRM practices entirely as Davenport
(2019) stated that AI appears to be capable of taking over most of the work per-
formed in the HR department, it is still a long way from totally replacing HR peo-
ple due to the ongoing requirement for human interaction when interacting with
personnel. AI technologies are used in many HR functions. This had also been
explained and examined by Verlinden (2019) that AI has become a crucial tech-
nique for recruiters, with 76 per cent of recruiters expecting that AI would have a
substantial influence on HR’s recruiting role. The most important function in HR
is recruitment, and AI is being utilised to replace manual applicant screening with
AI-powered screening to speed up this time-consuming procedure (Folick, 2016).
Reddy et al. (2018) conducted a study to know how AI impacts the recruitment
strategy. The research also sheds insight on the AI recruiting strategies utilised
by businesses. This study relies exclusively on secondary material sources such
as conceptual papers, numerous peer-reviewed journal articles, publications, and
websites to further examine the notion. To summarise the role of AI, it is the mix
of people and AI that results in data upkeep, cost and time savings for enterprises,
and increased accuracy and access throughout the entire recruitment process. Ian
Bailie examines the basics of AI and looks at how AI is being used in HR. It also
tells about large companies that have used AI. It was created for anyone interested
in learning more about AI’s possible applicability in HR. It looks at corporate
and academic sources to construct a picture of AI and its use in business, focus-
ing on HR. It focused on a few concerns, such as the budget for installing new
AI tools, whether technology has advanced enough return on investment (ROI),
whether HR has the technical expertise to deal with AI, and whether ethical
aspects should be considered when integrating AI technology.
AI also plays a significant role in the training and development of employees.
Employees need updated skills and knowledge to perform their assigned tasks
efficiently.
Adopting AI in HRM practices is a continuous process; thus, organisations
need endless training facilities to implement this technology in HRM. An exter-
nal hurdle to AI adaption includes data backup concerns, and if the third party
from another country is used, the firm will encounter challenges protecting
 Challenges of Adopting AI 115

against hackers and guaranteeing data security (Md Suliman Hossin, 2021).
Few individuals believe that they will lose their jobs if AI is implemented. Some
researchers think that if research is going to overlooks the risks, AI will pose a
severe threat to humanity. Organisations may confront internal and external hur-
dles while implementing AI in HRM processes. The greatest impediment to AI
adoption is the fear of losing one’s job. AI causes a massive change in effort from
physical to technical, so it has such a negative reputation for taking over people’s
jobs (Spadafora, 2016). Jain (2017) stated that new skill sets for employees are
necessary due to the incorporation of AI within the HR department. Employees
frequently find it challenging to learn and adapt to AI tools and be competent in
the world of data technology. One more research conducted by Jarrahi (2018) and
discussed the benefits of AI for humans. AI has aided decision-making, coping
with ambiguity, and, most importantly, equivocality in judgement in organisa-
tions. Humans continue to play an important part in industry, and technologies
must rely on humans when subconscious decisions are required to analyse and
promote decision results.
The implementation of AI in an organisation brings the digital transforma-
tion to the company and effectively coordinates the different units such as HR,
marketing, finance, and production. This is proved by the study conducted by
Shweta Jain (2017) discusses how AI changes the entire organisation and brings
coordination to different functions of organisation and states that HR team can
implement the AI technologies and can get better results in all HR practices.

3. Significance of Study
This chapter will help policy-makers understand the advantages and relevance of
using AI in HRM practices in businesses. As reviewed by this study, there are vari-
ous challenges encountered by the HR department while adopting AI. This study
suggests strategies to overcome those challenges and enhance their HR practices’
effectiveness. This study explains the challenges in implementing AI in HRM and
strategies to overcome the obstacles. Many types have been done in the informa-
tion technology (IT) sector, and only challenges faced by HR in adopting AI are
explained. To cover the research gap, this study explains the various strategies to
overcome the challenges faced by HR in implementing AI in their practices.

4. Future Scope
This is qualitative research; there is a broader scope for the researchers to conduct
quantitative research to find out the impact of AI in HRM. Moreover, future
research on HR personnel’s perception to implement AI in HRM practices.

5. Benefits of AI in HRM Practices

5.1. Streamlined Process
The organisation may save time and money by simplifying the process with AI.
Organisations may increase the efficacy and efficiency of candidate selection
116 Aradhana Sharma et al.

by collecting and evaluating a large amount of data. Chatbots, for instance,

may be configured to ask applicants specific questions before the interview
even starts. Incompetent applicants can thus be removed much more quickly
(Blogger, n.d.).

5.2. Less Human Bias

This is a simple problem that AI can readily tackle. AI is like the unbiased judge
who isn’t prejudiced towards the applicant and doesn’t have any prejudices about
them. Such techniques assess a candidate’s capability only based on their knowl-
edge and expertise.

5.3. Chatbot in HR
In HR, AI is utilised to automate minimal, repetitive processes, freeing up time
for more strategic tasks. Chatbots are becoming increasingly popular, automate
basic HR functions such as benefits management and resolving frequent queries
or requests using AI techniques (HR Exchange Network Editorial Team, 2019).
When communicating with a computer naturally, the company can get greater
outcomes than when the company uses traditional, human-powered methods.
It is an intriguing contradiction that human-supervised communication is less
compassionate than automated communication. Chatbots may be used to assist
engagement with possible applicants and supplement the company’s internal
activities. This is especially useful in high-stress job conditions. For example, the
British NHS, a national healthcare provider, utilises CoachBot, a chatbot built
by Saberr, a London-based HR firm. The system conducts brief interviews with
employees, inquiring about difficulties and obstacles they face daily. In addition,
the chatbot may offer brief instructions to improve the team’s productivity and
well-being (Karczewski, n.d.).

5.4. Better Employee Relationship Management

HR is in charge of resolving most employee issues inside the company. Questions
about leave policies, bonuses, and payments might become convoluted, necessi-
tating a chat with the HR manager. AI may be utilised via chat, a virtual room,
or email, and if the issue becomes too difficult, a discussion between HR and the
employee is scheduled (Patil, 2018).

5.5 Accelerate Competitive Advantages

Businesses must constantly monitor and adjust their competitors’ moves to stay
competitive in the market. AI in HR provides new insights, alters decision-mak-
ing, discovers rival strengths and weaknesses, and enhances business outcomes.
Foresight enterprises perceive Al as generating significant economic value and
providing a competitive edge on the commercial front.
 Challenges of Adopting AI 117

5.6 Better Employee Experience

Employees anticipate a tailored work experience as the globe watches the digi-
tal transformation develop in every aspect of life. Employees demand relevant,
contextual, and handy things that can be tailored to their preferences and situa-
tions. It is critical to understand the pulse of workers as talent pipelines get more
complicated. AI aids corporate executives in resolving this problem by addressing
four criteria: clarity, compliance, connectivity, and culture. The large spectrums
of data merging with AI allow technologies to help increase individual worker
experience (Saxena, 2020).

5.7. Effective Utilisation of HR Budgeting

HR budgeting decisions are highly complex because they ascertain long-term
financial and economic sales and profits. HR managers now depend on AI-
driven algorithms to make reliable budgeting and resource allocation decisions
instead of the one-size-fits-all approach that worked in the past. The primary
benefit of AI-driven judgements is that the data is supported by facts and
statistical numbers that have been submitted to a basic set of computations
(Saxena, 2020).

6. Role of AI in HRM Practices

6.1. Understanding Employee Referrals
By studying the sorts of candidates that workers are referring to and learning who
recommends the most active applicants, AI is helping HR departments to obtain
a better knowledge of referrals. When AI analyses past referrals’ performance
data, it could identify applicants who are similar to successful workers.
AI enables HR departments to enhance the candidate and employee experi-
ence by automating low-value, repetitive operations, freeing up time to focus on
the strategic, game-changing work that HR teams require or want to do (Reddy
Vinjamuri, 2021).

6.2. Effective Learning and Development

Learning and development (L&D) include preparing employees for new roles
that will undoubtedly require more human skills, as well as teaching AI and
digital dexterity. AI is a game-changer in capacity limitations and augmentation
in the developing world. AI is aiding in the design of tailored learning routes
using conversational intelligence, eventually paving the way for new vistas in
L&D. HR managers should conduct skill gap evaluations and organise appro-
priate digital training opportunities. Conversational AI can help managers and
staff keep track of such training (Reddy Vinjamuri, 2021). Moreover, it offers
career information and training as per the need of every employee, like an effec-
tive mentor.
118 Aradhana Sharma et al.

6.3. Scanning Resumes

Every HR manager or expert is faced with the tedious and time-consuming
task of scanning numerous resumes and applications submitted to the organisa-
tion for various vacancies. This is where the staff ’s experience comes into play;
quick scanning and selection are significant at this stage of the hiring process.
Nonetheless, all resumes are digital, with an increasing number of employers
prepared to take a candidate’s information online rather than a PDF document.
As a result, the natural language processing-based technology receives struc-
tured data to analyse and identify applicants who stand out among the throng
(Karczewski, n.d.).

6.4 Reduction in Employee Turnover

It is one thing to attract and develop talent within a company. Keeping it from
changing jobs is another matter entirely. AI can spot people willing to change
jobs and make preemptive moves by data processing about staff members and
information about their tasks. IBM, for example, is one of the most well-known
IT businesses in the world, with a solid hardware foundation and newly developed
cloud and AI capabilities. The business’ AI-based technology can accurately iden-
tify which employees would leave their jobs 95% of the time. Furthermore, the
AI-based software is now completing duties previously performed by up to 30%
of the HR department’s workforce (Karczewski, n.d.).

6.5. Promotion of Inclusion and Equality

With the talent war raging, businesses are becoming more conscious of minority-
related concerns and the ease of insulting someone. Organisations used to pay
public relations personnel to ensure that the language used in communications
was neither insulting nor prejudiced. However, there are occasions when this is
insufficient, and even a group of individuals cannot adequately handle all com-
munication in an acceptable amount of time. The most effective approach to han-
dling this challenge is using the natural language processing paradigm to monitor
communications.

6.6. Recruitment
According to Amla and Malhotra (2017) report, AI is used by barely 40% of
enterprises and industries. Digital technologies are being used by organisa-
tions like SAT, Facebook, and GE to screen, interview, and find fresh talent
for the recruiting process (Amla & Malhotra, 2017). Recruitment managers
may review applications using AI, and candidates receive prompt responses.
The chatbox system, also known as an automated responding machine, is
critical for resolving questions and issues related to the recruiting process in
a company.
 Challenges of Adopting AI 119

6.7. Interview Process

AI can streamline the interview process by assessing those using word or voice
patterns examinations. Ay software allows for digital interviews, and AI aids in
improving the applicant experience. Discussions and working sessions are sched-
uled using Amy and Clara tools (Yawalkar, 2019).

6.8. Less Administrative Burden

HR workers should multitask in a firm, with companies striving to reduce effort
using technology and AI. AI can help a company’s HR department become more
efficient by delivering solutions to problems.

6.9. Selection
HR managers may find the correct applicant in a short period using AI, and
technology can assist in identifying viable individuals with the needed skill sets
(Yawalkar, 2019). AI may also be used to assess candidates’ abilities and behav-
iours in real-world scenarios, resulting in a far more intelligent database for
recruiting choices, lowering acquisition costs, and enabling the HR department
to be far more strategic and less administrative (Ribeiro, 2020).

6.10. Reduce Discrimination

Presently, AI is being utilised to decrease partiality and increase workplace open-
ness. In this manner, the company will be able to choose the resume. Job descrip-
tions may be analysed using AI software (Rathi, 2018).

6.11. Enhance Efficiency

AI will assist in reducing staff turnover in the workplace. To improve workplace
productivity, various robotic tasks have been carried out. Gathering data, filing
reports, transferring information, finding necessary data from accessible data,
processing information for HR and payroll programs, and so on are examples of
robotic tasks.

6.12. Better Workplace Learning

Computers and digital technologies may now do behind-the-scenes tasks in the
industry. Industries can handle data analysis and give real-time feedback in train-
ing and change the course of action based on performance and replies received,
thanks to computers and contemporary technology (Riebli, 2018).

6.13. Onboarding
Once hired, candidates must complete a corporate orientation session led by HR
that introduces them to its culture, rules, and processes. AI might be the solution,
offering fresh applicants with relevant knowledge and resources.
120 Aradhana Sharma et al.

7. Challenges Encountered by HRM in Adopting AI

7.1. The Search for AI Experts
In September 2019, IDC forecasted that 97.9 billion dollars would be spent on
AI technology by 2023. AI continues to expand consistently as more individuals
accept the concept of AI and see its significance in today’s digital environment.
This rising need for AI also means a rise in demand for AI tech engineers. This
is supported by statistics indicating a 74 per cent yearly increase in demand for
AI skills from 2016 to 2019. However, AI specialists trained to deploy AI at the
required levels and can construct fully working systems are still in short supply
(Pedrajas, 2021).

7.2. Robust IT System

IT meets the demands of a rapidly changing environment. It makes life simpler
for us by creating systems that store, retrieve, and process data. IT ensures that the
gadgets and technology are secure, reliable, and efficient.
Many IT systems still have room for improvement. AI-assisted IT solutions
can improve it in a variety of ways. For instance, it may aid in developing layered
security systems, detect security risks and breaches, and assist programmers in
writing better code, ensuring quality, and optimising servers (Pedrajas, 2021).

7.3. Unstructured Data

Unstructured data is beneficial to a company, but many firms cannot get signifi-
cant insights since it cannot be evaluated using traditional techniques. Companies’
can’t be maintained in a Relational Database Management System (RDBMS),
therefore, processing and analyzing them is complicated. Audio and video files,
photos, documents, and site material are examples of unstructured data.
It will be simpler for organisations to make sounder and more rational judge-
ments if unstructured data can be decomposed, analysed, and maintained as sim-
pler analytical data utilising AI and machine learning.

7.4. Lack of Understanding

AI deployment necessitates a greater grasp of existing AI technologies, their
capabilities, and limits by management. However, there is a slew of AI fallacies
floating around, ranging from the necessity to hire an in-house computer science
team to sci-fi fantasies about sophisticated robots annihilating humans. In many
industries, AI adoption is hampered by a shortage of AI expertise. Working for
unattainable objectives is another typical error induced by a lack of knowledge
(neoteric, 2019).

7.5. Ethical and Work Culture Decisions

The sector would also confront difficulty with AI’s application to ethical stand-
ards, work culture, and decision-making focused on human feelings, as most HR
 Challenges of Adopting AI 121

managers are worried about their personnel’s well-being in the workplace. The
question is whether AI can learn to make valuable decisions. The level of technol-
ogy now suggests that the answer is yes. However, it will most likely take a few
years to realise (Patil, 2018).

7.6. Privacy Concerns

Private HR data should be accessed securely and only by authorised personnel.

7.7. Ongoing Management

Like other cutting-edge technology, AI needs deep learning and periodic assess-
ment and upgrades (Isbert, 2020).

7.8. Integration Capabilities

Due to the HR trend towards SAAS, data availability is constrained (Software as
a Service).

7.9. Inadequate-proven Applications

Many goods and services are only possible if proof of concept is provided.

7.10 Lack of Appropriate Data

A considerable amount of high-quality data is required to construct and train
successful AI and the more accurate the data, the better the results.
However, an absence of stakeholder buy-in can lead organisations to under-
investing in the data management systems needed to allow AI, leaving them una-
ble to correctly create an algorithm to address their business challenges.

7.11. Struggles to Find an Effective Vendor

Despite its rapid rise, AI usage remains low in most organisations. One reason is
that many businesses have worked with AI firms that do not fully comprehend
how to apply the technology to generate commercial value. Consequently, many
businesses have had unpleasant experiences while dabbling in AI development,
leaving them hesitant to take the plunge (Majewski, 2021).

7.12. Management Is Apprehensive About Having to Replace Old

Systems
It is incredible how many businesses still run their IT operations on antiquated
infrastructure, software, and devices. Furthermore, for fear of the expense of
updating current systems, management frequently refuses to implement AI
(Majewski, 2021).
122 Aradhana Sharma et al.

7.13. Financial Constrain

Financial constraints are one of the most typical problems organisations encoun-
ter when implementing AI in HRM operations. Many business owners view the
HR department as a cost centre. As a result, they want to invest in AI, particu-
larly in HRM procedures.

7.14. Employee’s Fear

This is the internal challenge. Companies face in adopting AI in HRM practices.
Employees fear job loss and consider AI technologies as they will replace them in
their work. So, they resist adopting AI technologies in HRM.

8. Strategies to Overcome The Challenges

8.1. Change the Mindset
The mentality of workers is one of the primary issues that HR has when inte-
grating AI in the HR function. The lack of expertise and comprehension of the
technology by HRs, on the other hand, has been a critical factor of the technol-
ogy’s failure to adapt successfully. This is the cause for the HR personnel’s pes-
simistic attitude. The widespread belief that AI would eventually replace business
HR contributes to the gloomy outlook. Companies take a long time to adjust to
change. We must shift our thinking from AI versus HR or ‘Will AI replace HR in
the organisation?’ to recognise that both are interconnected to achieve improved
performance and outcomes.

8.2. Proper Alignment

Some businesses jump on the AI bandwagon with overconfidence and no clear
plan. AI installation necessitates a strategic approach, including goals, KPIs, and
ROI tracking. Organisations should train their managers by creating awareness
regarding AI technology and the capabilities and limitation of AI technologies.

8.3. Reduce Biasness

Another significant problem is eradicating bias; even though AI systems should
eradicate all forms of discrimination and prejudice, eliminating bias from HR
procedures remains tough. HRM used the strategy to overcome the biases by
using AI techniques.

8.4. Understand the Ethical Issues

Employees and HR professionals need to be trained on the different ethical
considerations when collecting employee information and using it for corporate
reasons. Before employing technology for any reason, a clear line of ethical and
moral principles must be set, and both HR and workers must be trained and
 Challenges of Adopting AI 123

made aware of the consequences of crossing it. This will make the transition sim-
pler (Premnath & Arun, 2019).

8.5. Implement a ‘Hub-and-Spoke’ Strategy

In many companies, the adoption of AI in HRM fails due to a lack of teamwork.
AI teams fail to work as a unit; as a result, they create their infrastructure and
implement different workflows, which create problems in adopting AI technology.
This can be avoided by implementing the ‘hub-and-spoke’ strategy, under which one
central unit aligns all teams towards the standardised approach (Majewski, 2021,
p. 10). This will lead to the whole organisation getting benefits from AI investment.

8.6. Integrate the AI With Cloud

In today’s world, cloud solutions are also in demand. The cloud makes it easier
to save documents and programs on a device. Rather, it enables companies to be
stored in clouds, or pools of online data centres. Because AI can sift through and
handle the vast quantity of data in the cloud, integrating AI with cloud solutions
would make the system’s function considerably faster. This permits the system to
concentrate on more vital duties once again (Pedrajas, 2021).

8.7. Transparency Strategy

For everyone to utilise AI, data transparency and algorithm soundness are
required. These are the most critical issues that AI will have to deal with. People
are terrified of what they don’t understand; hence ethics must be examined more
in the development of AI technology. AI has limitless potential to improve peo-
ple’s lives; all people have to do now is find out how.

8.8. Improve Data Quality and Quantity

Companies should compare what data they already have to what the model
demands. Companies must first determine which model they will use; otherwise,
they will not explain what data is required. Make a list of the different types and
categories of information: Is the data organised or unorganised? Do businesses
gather information on their customers’ demographics, purchasing habits, on-site
interactions, etc.? They will recognise what they are missing after they have a
good understanding of what they currently have. Companies will be able to verify
which growing datasets work best for them once they know what data they have
and what information they need (neoteric, 2019).

9. Limitation of The Study

This study has certain constrained, such as:

⦁⦁ The foremost challenge faced was searching for relevant literature for this
research.
124 Aradhana Sharma et al.

⦁⦁ It was the stressful and time-consuming to gather relevant data for the study.
⦁⦁ Only secondary data is collected for analysis of the objectives of this
dissertation.

10. Conclusion
In the era of advancement, technologies play a vital role, and their position can
be ignored to gain competitive advantage and success in the businesses. Thus,
this qualitative research has found an interconnection between AI and HRM.
To ensure sustainable and effective HRM practices, organisations need to adopt
AI in HRM practices. Employee’s orientation programme, employee retention,
employee compensation and benefits, and employee reward systems are just a
few HR tasks where AI is being applied worldwide. HR’s recruitment and train-
ing and development operations are the two key areas where AI is most often
used. This technology enhances the effectiveness of HR functions. Still, there are
many challenges that are encountered in adopting AI in HRM, such as lack of
knowledge, support from top authorities, employee’s fear to lose their job with
the implementation of this technology, financial constraints, etc., these can be
overcome by adopting the strategies like transparency, hub-and-spoke strategy,
training to staff regarding AI implementation, reduce biases, and improve data
quality. HR departments all across the globe rely on human connections and soft
skills. In the foreseeable future, no computer will replace these abilities. However,
utilising AI in data and knowledge management processes may benefit HR. But,
organisations need to develop efficient and effective policies to ensure the practi-
cal adaptation of AI in HRM practices.
The HRM faces various challenges, such as privacy of data, talent gap, finan-
cial barriers, training facilities, etc. However, AI will assist HR in various ways,
including measuring employee engagement, supporting employee growth, match-
ing workers to skills, policies monitoring, competence verification, background
checks, person-organisation fit, employee referral networks, and talent discov-
ery. This study shows the various strategies to overcome the challenges encoun-
tered by HR in adopting AI in their practices. There is a need to change both
employers’ and employees’ attitude to implement AI in HR practices successfully.
Organisations should train their managers by creating awareness regarding AI
technology and the capabilities and limitation of AI technologies. Ethical and
moral issues cannot be ignored in adopting AI in HRM, and both HR personnel
must be trained and educated.

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