Name: The State of HR Technology and the AI Imperative
Uploaded: 2025-08-14T18:16:11.210Z
Duration: 1 h 2 min 8 s
Description: The State of HR Technology and the AI Imperative

Transcript for "The State of HR Technology and the AI Imperative": Hi, everyone, and welcome to today's webinar, the state of HR technology and the AI imperative. My name is Kate. I'm on the field marketing team here at Betterworks. As we wait for some people to come into the webinar, I'd like to kick things off with a poll so we can get to understand you all a little bit better. So I'm going to open the poll, and, hopefully, you got a little pop up that directs you to that tab right next to the chat. So we would love to know what is your biggest priority for HR tech over the next twelve months. Please don't be shy. We'd love to get to know you a bit better. So, feel free to answer that question as we go over some housekeeping items. So you see the poll tab show up right there, and that is next to our chat area. Please use the chat to let us know where you're calling in from. I'm personally calling in from Charleston, South Carolina. And I'm a big fan of GIF, GIFs, however you wanna call it. I love that Diane got us started already. So feel free to send in a GIF or GIF of how you're feeling today. We'd love to hear from you. Next to that too is a docs tab where we have some great helpful resources, including our state of performance enablement report, information about how AI can help with type of personification, the slides for today's deck. And then right next to that is the q and a. So we'll have time for the speakers to answer some of your questions coming up. So please feel free to use that so that we can ask your question. So let me just share those results of the poll before we get started. Thank you all. You can still keep voting. So lots of people. Looks like you're joining to learn leveraging AI for better people insights. We love to see that. Upskilling or reskilling talents. Got a fair amount for leveraging. Oh, improving employee experience. That's all great. Thank you all so much for sharing your insights today. So this webinar is part of our people fundamental series. This is all about building community and offering you thought leadership so we can work together on tackling the biggest, topics in HR today. Our speakers range from researchers to authors, to practitioners, and we love that you are part of this with us. So thank you all. Now I'd like to introduce our speakers for today. Stacey Harris is the chief research officer and a managing partner at Sapient Insights Group, a woman owned human resources, research, and business management consulting firm based in Mesa, Georgia. She's been a leading member of the HR practices and technology research community since 02/2007. She produces groundbreaking research on high impact HR organizations, enterprise HR technology, and key practices across the talent management spectrum. Cliff Stevenson is the director of research for SafeMoon's site group. Cliff is responsible for development and is one of the primary authors of the HR systems survey white paper. Cliff was previously an analyst with Brandon Hall Group and the Institute for Corporate Productivity. His experience as a human capital research analyst has focused on HCM, emerging HR tech, innovation, talent acquisition, data and analytics, performance management, and employee retention. And before becoming an analyst, Cliff was the head of HR for Boston RPO firm. So I'd like to welcome to the stage our speakers, Cliff and Stacey. I believe, Cliff, you are kicking us off. Yes. That's right. Thank you so much. So, I think, you know, we got a lot of the introductions. I've been really enjoying seeing where everyone's from. I'm currently in Saint Petersburg, Florida. Stacey is in Cary, North Carolina. I always wanna say Raleigh, but anyone that's from the area knows it's all part of that area. Saw a lot of people in from both of those states. I previously lived in Long Beach, so all the Cali people high. And before that, grad school was at Suffolk in Boston, so I saw some Boston in there. Represent. Oh, there's another Raleigh. So, yeah. We're gonna be going through AI, talking about, HR tech, the AI imperative. And what's really interesting, and Stacey gonna be going through some of the stats, you're going to be the first people to see not only how we are looking at this right now and what our data told us, in our 2025 study, but actually the new research that has just come out. So you'll have exclusive, view of that. And in light of that, I'm going to have to ask you to be very, very precious with this. You know, there's always a confidentiality agreement, but you're getting the most confidential. You're gonna be seeing some stats, that we wanna give to you so you have a better feeling of this because, one of the things I'd love to see actually so we're gonna take advantage of the gifts. Right? I wanna know how you're feeling about AI in 2025 in GIF format. Word GIF format, I realize that's contentious, but we're gonna play along. Tell me how you're feeling, and hopefully, the data that we share today will help give you a better grounding of just how you should be approaching AI or how we think, you should be taking it in. You know, it we don't want it to be overwhelming. I think a lot of the marketing out there makes you feel afraid or maybe it's too much hype. We're gonna give you the wrong numbers, where people are using it, where they're finding success, and what we think the future is. So, with that in mind, like I said, please don't, speaking of AI, use any of this, putting any of this data into AI, the sole proprietary, find people Betterworks to have, made sure that, you know, we're keeping this just for you all. As mentioned, Sapient Insights Group is a research and advisory firm, women owned and operated. And, besides, you know, the research and the data and that big, report that Kate mentioned earlier, we also do advisory services around culture and leadership, and change management. So any of that stuff sounds of interest, please let us know. And, of course, you know, you can reach out to us or you can listen to our podcast as well. You know, why not? That's called Spilling the T on HR Tech, where we'll also go over some of this news. But so here was the data that we're gonna be pulling from. Right? So you see it's worldwide. It's heavily focused in North America, but I think that works, for this group. A lot of unique organizations. So we had over 5,000, over 6,000 people actually take the survey, but, of course, if they all were from the same organization, we group that together. Right? We say how this organization works. And then we look at the number of employees of those organizations. There's really extraordinary amount of people represented in the survey. In fact, when we did the maths on this, we realized that this data represents one in, I think, eight US workers, which is just extraordinary. Right? When you think about this, that's a high representation. So we feel very confident, in these numbers, and we feel the ability to kinda cut through the hype because of that. So with that, I'm gonna be doing a lot of, stuff over in the chat, talking with you, sharing my own GIF. So, feel free to ask any questions. You can do it in the chat or in the q and a, and I'll relay anything over to Stacey as she, is the big brain and will take us through there. Thanks, Cliff. And I was having a great time laughing at all the gifts, and so I was I was also like, oh, I gotta go on stage. Wait a minute. So, thanks everyone for putting your comments in there, and thanks, Cliff, for letting us kinda know, how we're gonna get through the the presentation today. Cliff will come back on, talk a little bit about the AI conversation here. There's so much going on right now, and, I think, you know, your, guests are a real good example of of the the spectrum we're seeing from fear all the way to just pure excitement about what AI can do in the market. But it's also about what we as HR professionals and HR leaders are are, taking into these conversations and how we're approaching these conversations from an HR perspective. Because no matter how exciting AI is or how scary it is, we still have to get the day to day job of doing HR done. That doesn't go away. That I I I know there's been a lot of comments in the market that HR will change fundamentally. How we do things might change, a bit, but it isn't but what we do is not gonna change. Cliff and I talk about this all the time. We have to bring people into an organization. We gotta make sure they're aligned right with the work. We gotta make sure performance is managed. We definitely have to think about sort of how we assess, the roles within organizations. And we have to make sure when they are ready to lead that we do it appropriately and all the things in between from regulations and policies to engagement and performance. We're we're in charge of making sure that that happens appropriately on an HR level. One of the things we want to talk about today, as Cliff had mentioned, is a lot of the work that we're gonna be talking about comes from this big annual HR system survey that we do. One of the things that we because we do this year over year and we've done it now for over twenty eight years, we're heading into our twenty eighth year, is that we get to see things, at a very, very sort of broad picture perspective and a and a longitudinal perspective, which means we can look year over year and see how things are changing and how people are interacting to that. Right? And one of the things that we, see really clearly is that much of the business leaders, conversations today are not just we're focused on AI or we're focused on what we're doing in a in in sort of the business operations side of things, But it is a bit of a reaction to where they've been over the last five years. And we've talked about this in the sense that COVID, although it was over five years ago, I know that's hard to believe right now the COVID crisis was. My granddaughter was born in 2020. I just went out and visited her. She's getting ready to start kindergarten. Don't ask me how I feel about that. I am overwhelmed with the fact that I have a granddaughter who's starting kindergarten already. But it it it does seem like it has been a long time. But in a as it relates to business financials and what we're doing as organizations and how our employees are feeling, it actually is very close in time frame. And what we have found is that a lot of organizations, particularly business leaders, are feeling like what has happened is that we never really sort of, came out of the COVID crisis with a a new normal to some extent. We've just been kinda compounding every year new, more challenging conversations, more challenging things until we got to 2025 and 2026. We went from this idea of, you know, great resignation and and people sort of challenging the status quo to cooling economies, to political uncertainty, to to this massive regulation shifts and economic swings that are now forcing sort of a focus on both revenue generation and cost cutting at the same time, which is basically creating a lot of challenge inside of our businesses. Our business leaders are, facing global labor issues and new AI driven skill requirements. So not only do we have a a lack of of workers in certain areas like health care or on the ground manufacturing or skilled labor work at a services level. But we have an an explosion of a new requirements on the AI side, and we have a lot of what we would traditionally call sort of, white collar or middle level, corporate roles that have been sort of reassessed for where their roles are compared to AI. So there's a lot of shifting going on in these businesses. And then we have the global climate risks. That is no longer a conversation about what is and if it's going to happen. We do know already that we are our companies are dealing on a daily basis with more, challenges dealing with, both globally and in our individual regions with things like, heat waves and fires and, floods and hurricanes and tsunamis. Right? I like I said, I have a family that's over in Hawaii. We we went through the whole process of where's everybody at. Are they safe? Every company who has employees in Hawaii had to do that in the last, week. And those kind of things are no longer, a conversation just about what ifs, but now it's what level of risk are we managing inside of our organization? Where are all of our populations? How can we manage that? And then finally, the last thing, and it's by no means the most important, but it is the thing that's that's getting the most attention right now is this conversation about AI. And that's no longer just a technology. That's no longer just a conversation about what it could do. It is about what it is doing and that it is actually doing some of the work. There's been a lot of conversation in the market about whether or not AI is, should be looked at as a technology, should be treated like an employee, should be managed like a resource. I think the answer is all the above in some of those cases, and we're gonna talk a little bit about how you get your arms around that as an HR professional. So love love all the conversations that you guys are having on the side about this. But let's dive into just some of the data that as HR professionals, we're we're providing to you. But I think what you really wanna take away from this is how do I do this for my own company? How do I create this visual this environment about, the context that my business is working within. Right? And there's really, really important things, to understand, which is as much as it feels like the whole world's going through layoffs and and and there's there's just more of our friends generally because of these places that we work in in our environment who are out of work right now. In reality, we know that there will be 92,000,000 jobs on average as based off the World Economic Forum, report that just came out, a few months ago that will be displaced by AI this decade, right, over the next ten years. Not something we're all disputing. But there will also be an expectation when you think about this based off of their research and extrapolation of how things happen with the Internet boom, with other new technologies, other innovations, as well as what we know about what AI is gonna be bringing to the market, a 170,000,000 new jobs will be created this decade. So that's really gonna leave us about 78,000,000 jobs to fill with an already declining workforce. One of the things we know is that today already that in The US, based off of where we were at in, '20, 2005 versus today, we've gone from having sort of, over sort of, six or seven, employed professionals in the work environment, for every nonemployed person in The United States. To today, we're right on the edge of about, four and a half, almost three and getting lower than that. In Europe already, they are below or at three working professionals for every nonworking person inside of that, those, communities. That really just means we do not have as many people in the workforce to support nonworking, people within our our communities. And that's a huge issue that we really haven't had to deal with for multiple decades in our market. And that's something that's really, really huge. Rajeev, you're asking about the source of the numbers on the top. That's the World Economic Forum future jobs report. There's a there's a a source on that at the bottom it should be in, but that is where you can find it as World Economic Forum, and there's a jobs future jobs report 2025 source. That report's probably one of the ones that I have watched on a regular basis over and over again. The other thing I think we really have to think about is that, there is a huge number of sort of shifting expectations for job roles. Now there's been this this chart that everybody's seen that's come out of the US bureau, Census Bureau, about to the population of, professionals who are being hired, who are recent graduates, from secondary, post secondary, graduate schools, and how that number has continued to decline since 2015 at a pretty rapid rate. Now a lot of that is being right now sort of late at the feet of AI and that we're just not hiring new employees, that we're not bringing, people back into the workforce who are at a, who are just coming out of college because of the AI shift. And there may be some of that that's true to that conversation. But we really have been since, since, 2010, since that recession that happened in 02/2008, 02/2010, seen a decline in that and the requirement for having a college for certain positions, particularly tech positions inside of organizations. When we also look at the other side of the picture, when we look at where there are open jobs at, we know that those are more in trade positions, in skilled labor roles. 1,700,000 skilled labor trade positions will be created in the next ten years in just seven roles. The number of home health for self care aids are needed by 2020 by 2033 will be 1.7 times higher, than AI software developers. Right? Like, this is something I think because we live in the world where we're often in, where we're talking a lot about AI, where we're talking a lot about technology, where we're talking a lot about our roles in HR, we forget unless we're working in an industry where this is foremost of our mind every day, how important some of these current roles are that are not being filled. Right? The top three fastest growing jobs are service technicians, solar installers, and nurses. Nurses. If you have anything inside of your organization where that is being done, you're gonna have a hard time finding those those workforces. What we're saying is that this data is available, whether or not it's through the the Bureau of Labor Statistics. We know some of that data process is changing or even available with some of the large HCM providers who were providing data like that. Some of the, the World Economic Forum is doing the global, datasets around where where workforces are and skills are available. One of the big things we always tell HR professionals is know the world you're living in. Understand the economics and the availability of the workforces that are important to your business and your organization. If that if you don't have an understanding of that, even if you're just in, in in a role where you're doing HR technology or you're in an HR analytics role or you're in a performance management role, you should have the same understanding as your CHRO about the level of availability of the skills you need in your current market and in your current region and in your and globally because that's the conversation that your business leaders are having. Now they're having that and as it relates to AI, and they're having it as it relates to the numbers around, unemployment, they're having it as it relates to the information that they're seeing about risk management. But they're gonna wanna have that same level conversation with you no matter where you're at in the HR process. The other thing that we're seeing in this market that's really, really important is that, the idea of outcome focused HR functions has definitely taking hold in the market. What I mean by that is that HR for a long time has oftentimes been sort of pigeonholed into either compliance function or a best practices function, which basically means we have a lot of HR processes. They don't they're important. We know that there's some standards for our professional market, but we haven't always sat down and said, okay. What is most critical to our business and how do we tailor HR to our business needs? And part of it's because we were building a profession. The market was changing rapidly. The technology was changing rapidly. But what we do know in our data, and we've been tracking this for over twenty five years, is that there is a difference in how organizations are perceived and the outcomes those organizations can achieve based off of how they're perceived as an HR organization, whether they're seen as compliance or a best practice HR function or an outcome focused HR function. And more importantly on this is when you think about this is that this is not a pyramid. Right? We we you'll notice that, you know, we have kind of a how you kind of go up, which is the percentage of organizations that are in each of those categories right on the left hand side there. Only 52% of organizations last year felt that they were being viewed as a strategic partner inside the organization. But this idea of sort of the, necessary areas that you as an HR leader have to focus in and and that you wear what you wanna be seen as a strategic partner. What we tell people all the time is that compliance is critical. You have to get that right. Your best practice is a critical. You have to understand what's happening at a professional level, and your outcome focused HR function is your primary goal. And so what happens is if, for some reason, something breaks in compliance or as an organization, there's a new practice that comes out in the market that you have to be on top of, you have to kinda it's more like a railroad track that trains go back and forth and is what we see is that you really have to focus on understanding, sort of where your organization is at at any one point in time in all of these areas and the and the impact they're having on your business. But the biggest conversation you have to do is understand what your organization is trying to achieve from an outcome perspective and tailoring your HR function to that. And part of the reason why this is really, really important is because our businesses today and this is a this is a little bit of sneak peek data that Cliff was talking about, so no one else has this data right now. We asked them, what are the things you're trying to achieve? What are the big initiatives that your organizations have this year? And I just wanna highlight. We have over 4,600 individual organizations in this dataset this year. We get over 10,000 people hit this survey this year. And it by and far, our survey is very long and very in-depth. We know it's a hard survey to take. So for anybody who out there who took it, we said, high five. Thank you. And if you're interested in participating later on, just connect me and Cliff. We'll make sure you because we have it in your life. But one of the questions we added this year because we really wanted to understand is what are the main initiatives that your businesses are driving for in 2025 going into 2026, so basically over the next twelve months? And what we found is that for organizations of 5,000 and above, their two top things that they're focused on are increasing revenue and improving efficiency. Oh, and by the way, organizations 500 to 5,000, their top, focus is increasing revenue and improving improving efficiency. And, oh, if I'm under 500 employees, it is increasing revenue and improving efficiency. That has not changed no matter whether you're the smallest company in the market or the largest company market. And it's different from where it was at last couple years where there might have been increasing revenue and maybe optimizing or, focusing on, digital transformations or some other things that were a little bit more important. This idea that I'm gonna kind of improve efficiency, optimize processes, reduce cost while I'm trying to increase revenue is tied directly to the AI conversation, but it's also tied to the way businesses are being run today. And that's putting a big squeeze on both HR professionals. It's putting a big squeeze on our employees. It's creating engagement issues inside of organizations. And what really changes when you look at this dataset across this market is if you look at what kind of the next tier of things that they're focusing on as an initiative. If you're over 5,000 employees, your biggest focus after getting through cost reduction and revenue is digital transformation. That's where we're spending our time, where we're spending our money, where our business leaders are asking us to focus. If I am an organization between 500 employees and 5,000 employees, my most important critical thing after I get through reducing cost and optimization and and increasing revenue is boosting employee engagement. And I'm sure this isn't a surprise to you. You're in the middle of this mix as an HR leader. But the most important thing here to understand is that as we're making these big changes, our employees are watching them, and their engagement levels are dropping pretty rapidly because of it. And so there's a real big balance, particularly for organizations who don't have a lot of financials to throw at employees, who have to rethink their benefits at at different levels, who are really trying to keep up performance while they're going through these changes. Their biggest focus is on this idea of keeping up engagement while they're going through this. Not to say that organizations 5,000 above aren't having that. That is still in a conversation with them. But their belief in many cases, I think, as we're seeing in the data, is that digital transformation will create simplified processes, which will eventually create more engagement. Here's our conversation about that. If HR is outcome focused, what we're gonna really have to look at is the metrics are gonna change that they're gonna be asking us to talk about. You're gonna be your your HR leaders and your business leaders, if they're not already asking you, they're asking you about revenue per employee. Make sure you understand what that is for your company. We're they're asking us about process and workflow efficiencies. They're asking us about compensation and talent gaps aligned with innovation metrics. So if I have an AI agenda inside my organization, what's the compensation that I have to have? What's the talent gaps I have in associated with those initiatives? Our role in supporting enterprise AI ethical standards is a big conversation they're asking HR to get involved in. They they are not get they're not shying away from this conversation, but they're asking, HR to step up to it. And they're definitely talking to us about our approach to managing change. Change here is not the traditional big project management change management we've seen for years. Change here is this idea of continuous, always on communication change, making sure people feel comfortable, making sure they feel engaged, making sure they feel part of the change process. And then finally, that engagement metrics, throughout that change process is the other thing we're seeing that business leaders are looking for. Again, they wanna understand engagement, not just overall, but engagement as it relates to the changes that we're making. So that same question that Cliff asked when we started, how are you feeling about the AI, world today and what you're thinking about it? That's what they're wanting to understand of their employees right now. These are things that we're seeing in the data that are already starting to pop up. But what I really think is important is that HR professionals have been talking about these conversations for a long time. They may not always have the same metrics. They may not always have the same dialogue as your finance or your IT professionals. But we've always been very good at talking to the CEOs. I'm not a big believer of the idea that HR doesn't get the respect they need, because of the CEO relationship. Our data shows very clearly, if you look at this, that when we ask owners, partners, CEOs, and executives whether or not they view HR as a strategic partner, they're more likely than HR themselves to say that HR is a strategic partner for our organization. Over 62% of owners and partners inside of big firms and organizations said that their HR function was seen as strategic and a partner to them over 55% of CEOs compared to just 52% of HR professionals last year. What we do see, though, that I think is really holding us back from this conversation about being a partner and being able to have the strategic conversations we need to have a lot of times is not at the top of the leadership funnel. We're arguing that shows where we have our biggest challenges is when we're talking to some of our own internal roles and more importantly to IT and finance. That number one role that views us mostly as compliance versus as someone who is a strategic partner is our finance leaders. And as this market has been shifting towards optimization and thinking about revenues and revenue per employee numbers, the person that's being brought into the conversation most often is your chief financial officer. And that's where HR really needs to spend some time connecting and creating a relationship. And I know you're probably thinking, why are we talking about, chief financial officer as we're talking about AI? Well, here's the thing. If we want to have that very good solid conversation about what AI can give our our business while keeping engagement out, while managing the work that we're doing as an organization, while making sure that we aren't undercutting our future to reach short term goals. We have to be not just aligned with finance, but we have to be really having deep conversations. So finance comes to us for conversations before they go to the CEO because that's really where we need to have those conversations at. And that's what's not happening in the dataset from what we're seeing. We're also not having great conversations with IT right now. So we might have an HR IT professional in many of the larger organizations, but a lot of organizations, even if they have an HR IT professional, are not viewed as as critically strategic partners to the IT role being our CIO within organizations. So the two things that we're saying that to really take ownership of the AI conversation is the first step you have to do, know where your business is at, understand your economics of your workforce, understand the skills of your workforce that are really high level, make sure you have a relationship with your finance partners and your IT partners even before you're thinking about your CEO partnership. Cliff, before we move on to the next slide, I think, you know, it would be really great to to to sort of get from the audience a little bit, maybe on the the chat window. I know do you feel like you have a a a better partnership with IT or finance right now? I'd be interested in knowing sort of where you guys have that. And if you have additional questions, please make sure you put them in the q and a box. But, Cliff, do you, wanna sort of maybe add in a little bit on what we're seeing about not just the IT relationship, but the changing metrics around the finances and and why it's so important for IT to have that relationship with IT right now? Yeah. And actually this will will kinda get into the AI discussion. Right? As HR's role evolves and we are starting to get more involved in using data for decision making, something you've been hearing forever. Right? But it's really become front and center during the AI role. That relationship between HR and IT becomes paramount because it really comes down to, you know, the most exciting topic of all time, data governance. Yeah. You know, it's where the data is stored, who has access, how it is stored, you know, meaning format, obviously, security and privacy. All of those, if you're asking an AI system, right, to say, okay. I need you to make recommendations or I need to, find anomalies in all of the data, or anything like that. Right? It needs access to all that data that's controlled by one group or the other. So having a good knowledge, or control of the data really is what I think is stemming, this sort of ongoing back and forth between HR and IT, as really whoever controls the data will have basically control the future. Right? Because, the future is going to be AI. I don't mean that in the marketing hype sense. I just mean that it is going to be sort of embedded within a lot of our processes. Probably not a 100%. Everyone's got their own guess. But, you know, much as you think about, you know, the mobile phone revolution and stuff, right, you had to start thinking about how that was going to affect work. I think that's a good way to think about with AI. Alright? So if we're gonna be using it, we need to start with, where all of those sort of data questions are. Right? Even when it comes down to file formatting and things like that, you know, that will all, come down to it. And I see that, in the chat, there's some really good, you know, back and forth. And I think a lot of people that are kind of in that in between space, like, Devin, where it's you know, knows both the HR and IT, being able to find that common language and that discussion is really, I think, what's underlying a lot of this, sort of more strategic view of the HR and IT relationship. Yeah. And it's and it's a funny thing, I think, that that that I it's why we start here with this because so much of the conversation is about learning AI and knowing your technology. But what we have found is that it is these relationships. It is this setup that you do that really makes it what makes the the the ability for you to do AI inside your company much better. Right? And and just sort of add to what Cliff's talking about here is that and what's going off on the side on the chat window is that it's very clear that it's kind of a split. There's some that are much more aligned with finance and some that are much more aligned with IT. And our data is definitely showing that you gotta you gotta do both of those. Right? And the reason you wanna be viewed as strategic inside your company is not just, oh, that's great. We like to do it. It makes us feel better. Right? Like, what we know from our data and again, we've been doing this for twenty seven years, and and we can look at the data year over year. We have a series of business outcomes that we track every year in our data, including very big business and financial metrics. What we see over and over again is that those organizations who are have an HR function that is viewed as strategic by the the, broader set of their company, they just get better business outcomes. On average, that outcome looks at, about 47 42% higher levels of improved both HR talent and business outcomes. When we look at just business numbers, that jumps to about 11% year over year. So if you just think about if you sort of ask your your business leader, look, if we just look year over year at, if we were able to improve numbers by 11% in either, profitability or customer satisfaction or market share, what would that do to our bottom line? And the only thing you had to change was your view and your relationships between finance, IT, the CEO, and CHRO to get that improvement instead of investing in another new sales system or another new, technology, that's the kind of conversation that we need to be having in our business leader level that, look, it isn't just about the fact that we wanna have a seat at the table. It is about the fact that when we're viewed as strategic, there are conversations we can have. There are things we can do to make things move faster. And that's really what you wanna do with the AI market. And a lot of the reason we're not moving fast is because, in many cases, HR has been relegated to order taker, particularly in the HR technology space. Right? One of the things that we see in our dataset, Cliff and I track somewhere around 3,000 different HR it goes up every year, but different HR technology vendors. And we only cover just a very small set of them. Right? We know there if you if you talk to someone who sort of tracks all the vendors, someone in the range of five to 7,000 different vendors who are serving the HR technology business needs of HR professionals. Right? On top of that, we know that not only are HR technologists, the people who run those systems and whether they're an individual HR IT professional or they're a HR leader who has HR technology underneath their purview or whether they're a talent leader who has HR technology within their purview, Those are, those people who are running those environments and managing those environments are not just having to manage all the different vendors who are coming to them having conversations on a regular basis. They're also having to manage budgets and, resources to support those. They're having to manage maintenance updates, calibration work. They're having to manage, change management processes, comp, training needs and communications around it. They're having to manage the, very important roles of implementation, but also the continuous, configuration and workflow process that goes on inside these systems. It's a very large job to manage these systems and to do it in a way that makes sure that the data gets to the people who need to get it. And one of the conversations we hear over and over again is that for many organizations, this has become not just a full time job and melt multiple levels of full time jobs in large organizations, but it has become an overwhelming set of we're spending a lot of time thinking about the technology and not a lot of time thinking about what we're getting out of the technology or what we're achieving with those things and having those conversations with our business leaders. In fact, when we look at enterprise HR systems overall, we can tell you that big systems like HRMSs, payrolls, analytics, even at time, or even our benefit systems and our learning systems are year over year seeing lower and lower user experience and vendor satisfaction ratings, compared to what we're have seen over the past couple years. And part of that is not just these systems have been adding. There's so many different modules and opportunities and things to connect. Part of the challenge here is that they're not connected the way we need or they're not giving us the outcomes that we wanna achieve. And this is really the conversation that our business leaders want to have, not whether the tool is right or not or features or functionalities. They wanna know what's the outcome we're achieving with this technology and how are we using it to get to that initiative, which is our goal of increasing revenue and reducing, cost or process automation or whatever it might be within the organization. And as Cliff had mentioned, the HR technology who owns the HR technology budget plays a big role in some of this. One of the things that we've seen is that over the last probably two to three years, we've seen a a year over year 30% increase in IT, especially for organizations over 5,000 employees owning that HR technology budget. And that may not seem like a big deal, but what's happening is that as that budget is being shifted to IT, what's happening is that where IHR had functionally owned a lot of the responsibility for the things they're doing in their organization, That view of HR being strategic is also slightly, sort of misaligning to wherever the HR technology budget is on. So what you'll see next year is that that's gonna continue to go up. IT will continue to own more of the budget, especially at the enterprise level. You're gonna see for, mid market organizations, more HRIT, HRIS roles, which is good. We're glad to see some of that going up. And for small organizations, you're gonna see finance own more of that HR technology budget, which means sort of HR is in the middle there somewhere. And here's why this is important. It's not to say that you should have turf wars over who owns the HR technology budget. What you should really think about is what is the responsibility you have and how do you maybe keep ownership of the budget as an organization who is going through this conversation with your IT and your and your finance organizations, and why is there value in HR keeping some of that budget? Well, one of the biggest things that we're seeing organizations are approaching in keeping an HR technology budget is they're taking basically a much more different approach to their HR technology infrastructure setup. Now this is how we're gonna get to a better AI because if we do not have our HR technology infrastructure set up appropriately, we're not gonna be able to reach sort of the nirvana that Cliff was talking about, which is AI has embedded everything that we're doing because it's not gonna be able to doesn't have the roadways to have the connections that it needs because it's really good at leaving over a couple of barriers, but it can't go from system to closed system without any conversation or connected conversation. Right? And so what we're seeing is that organizations who are really taking ownership. Look. I wanna upkeep my budget. I wanna be in charge of my HR, data. I wanna make sure that I am viewed as a strategic partner. They're really starting to think not about best of breed or all in one systems. That's not working for anybody anymore. What they are thinking about is what we call platform clusters. And platform clusters is all about figuring out what is your anchor systems. What are those systems? Maybe it's your performance system. Maybe it's your analytics system. Maybe it's your learning. What is the system that is central to you doing a important thing inside your organization? And then how do we make sure that we time that, an ecosystem of solution providers with that who have very deep integration? And that's the real conversation. Where is the data flowing? And the best thing to talk about that is to really think about, how you put together your HR tech infrastructure. So we're gonna do a poll real quickly here of what is your organization's current stance on AIHR before we dive into how this connectivity is gonna happen. So I'll go ahead and and, let everyone go ahead and go to the polls tab and be sure to answer that. While you're answering that, we'll talk a little bit about this. Cliff, as we get into the AI conversation, you and I talked a lot about this idea of platform clusters. Do you feel, in the platform clusters conversation, that we spend enough time talking about integration right now? Yeah. Yeah. We need to talk more about integration. Right? Because that's everything that's driving this sort of movement. And I wanna sort of reiterate what Stacey was saying that, you know, so much of research, you know, we're not trying to sort of I mean, we are sort of advising. Right? But we're basically reflecting back what we're seeing. And this whole idea of the cluster model wasn't so much a, here's what we see as, what you should do, but what we are finding successful companies were doing or, we're more or less being, sort of had to do. Yeah. Because of everything we talked about before where data is really what's driving everything, you need systems that not only just work together. I think for so long, we focused too much on, you know, single sign on, like, just to sort of ease. But really, it comes down to, do these systems all talk to each other in a way that is conducive for driving business success. Right? So it's not just I can't go over there and grab the data. I really don't have time for that, especially when we're, again, talking about using these more new powerful AI driven tools for making queries, getting real time reports, trying to figure things out quickly. You need to be able to access all of that data, and have it a way that it can be, set up. So there are correlations so you can sort of see it against each other. So, I think that's really what's been driving this move towards a cluster model. One thing that makes HR tech a little different from some of the other consumer technologies is so far to this point, we have not really had to deal with walled gardens. Right? You don't have to say right now that these are the systems that you have to use, because these two literally cannot talk to each other. Right? They're they're cut off from each other. You're doing fine as long as you just buy, you know, Mac products or or Android products, right, as we've seen with other types of technologies. That doesn't mean it's not moving towards that way, especially when it is extremely, valuable to keep sort of proprietary information, software, very expensive technology that AI has and is, continuing to be. So this sort of cluster model, I think, is a natural reflection of what sort of needs to happen, but it's important to understand it going forward, especially when you're looking at things like marketplaces for these companies. Right? Because that's really what we're talking about is, yeah, almost anything can integrate. But and this is gonna be tough. If you're just listening, there's nothing I make big air quotes here. It does it integrate? You know, it's one thing. Yeah. Sure. It can send information on query. But is it completely a two way thing? Is the information being changed in any way? All that sort of stuff. The true integration. Right? That's what you're looking for, and that's what creates those clusters because only certain systems right now can do that. Yeah. And and what I want to sort of point to is that when we when we were asking our patients about where there are in their area of journey, it is almost exactly your dataset to what our data is showing you. So, yes, all of these conversations we're having are about how you get set up with it. But what we definitely saw was that, you I think it was, like, a 35% when we went away from the from the, poll to, our data definitely last year said that organizations at an enterprise level, 43% of them were using AI to, as as within their HR processes. Not using AI just as a personal tool, but you had embedded AI at some level in their HR processes. This year, that number is only gonna jump up to about 45%. Again, first people to hear this data. In aggregate, overall, it will be about 30% when we look at organizations of small, medium, and large as you can see here. What we basically saw in our data is that just kinda where we predicted, that is where people are at right now. A lot of people are experimenting. A lot of people are evaluating. We're gonna have some new insight on what percentage of organizations are evaluating, but very similar to the numbers that we just all say, which always makes my heart feel good that there's some validation too, that the data is very valid. What we do know, and I'm gonna jump through this poll and maybe do the last poll just because of timing that we have, and I wanna get through some of the the slides, is that we we wanna understand what role do you think HR and people should play in the adoption of AI across your workforce. Can you put that poll up really quickly? And I I hopefully, we can go to that one and and skip it, and it won't cause us any issues. Yeah. And while we're talking about this, and I'm gonna let you guys go ahead and answer that, what role do you think HR and people should play in the adoption of AI across your workforce? Can I will I be able to move on and then you can go back? Kate Kate, I just wanna make sure that I can do that without messing up everybody on the full question. I think the answer is gonna be yes on that. I'm gonna I'm gonna move forward and then we'll pull the poll up as once everybody's done sort of putting in. Because what I wanted to show you is that the barriers that we see to organizations, why are they not going to it? Right now, what we're seeing is that there's not enough knowledge or understanding. There's no current need in some cases. The privacy concerns and the lack of internal AI skills for proper use. Now that no current need goes away when you're an enterprise over 5,000 places, much more for mid market or SMBs. What we are seeing is that we are expecting a 150% growth in the use of AI agents for HR service delivery in the next twelve months. Though there are very specific use cases that are coming out in the market, and part of this is because HR right now and what we're seeing in the data is very focused on helping their business get AI up and running in their business model. There's some risk in putting AI in our HR processes, particularly in areas like recruiting or performance where there could soon be some questions about where that data is coming from, what is the AI behind it, how is it getting the answer. And so what we're finding is that it's much more important for you to be in those ethics and data privacy conversations and AI global conversations. And it's important for you to know what you're doing in your own enterprise and your own embedded solutions, but where the business needs your help most is at an enterprise level. And the other reason why this is so critical is because what's happening and how we look at this future conversation is the businesses have to figure out where their new AI model is first, and then HR can go behind. It's okay. Now how do I rework the workforce models? How do I rework the technology that I need? How do I rework the resourcing models that I have? All of that has to come as part of a business wide conversation. And we're gonna go ahead. Can we show the poll response to that one just so everybody can see it? I'm not sure if Kate if I might have messed you up on that. There we go. There. What role is HR is playing? Currently, right now, you guys are saying that we're we have an influential voice in AI adoption, and I would say that's really, really important. We're consulted but not a major. I think you wanna I'd love to see almost 70% of you saying we have an influential voice in AI adoption. You need to be there, and you need to have it on the enterprise level, not just us personally in our own enterprise. And the conversation you can have with your business leaders is, look, we're taking it very carefully because we have so much personal incentive data here. Our business has to run and run fast with AI. We need to be part of that conversation too. The two things aren't connected in many cases. Alright. We're gonna go back and look at the last couple of things, and then we'll wrap and we'll definitely make sure we answer some questions. So yep. Can you guys moment to get back to our slides? There we go. Alright. Last couple of slides I wanna sort of walk through. One is the idea of why are we bothering with AI in HR. Well, the most important thing is hyper personalization. That engagement conversation I had. Right now, AI has been all about taking my job, reducing working in nature, services, those kind of things. But, really, if AI is done effectively and AI has done very well, is that it will hyper personalize the experience for the employee. That is the ultimate goal. And once we get hyper personalized experiences, the next level is workforce planning and skills management. And so to do hyper personalization, you know what we need is not more AI right now. We need skills and job definitions, data management models, all things Cliff talked about, ethics models, real employee trust, constant calibration, willingness to evolve, change leadership. Those have to be in place before we can put AI on top of everything. We can test AI. We can work with it a little bit, but we have to make sure we have our infrastructure in place or the employees will have a backlash against it, particularly if they don't trust it. So there's real value in sort of balancing how you think about it in an HR. Our data is definitely showing that. One of the most important things you have to do is think about your skill strategy. And one of the things we tell people that if you get that skill strategy right, again, view view it as a much more strategic HR function, really, really critical for organizations. There's an easy way to do skills, which is you just open up the window, you let people start tracking skills. Now I've got this database we we hear the term called, of skill swamp, which just a lot of skills sitting there with nothing to do with them. Or you can do the hard work of putting in taxonomies and ontologies and lining up the work. It takes more work. We're focused on business outcomes, but that is the kind of level of work that needs to be done to get to that hyper personalization. It's one of the first steps you've gotta take and why AI is so embedded in skills right now. The last thing I wanna do before we jump into questions is really talk about how does this fit into your HR service delivery model and workforce experience model. I cannot emphasize enough that AI alone over 70% of HR professionals are already using AI to do their job in some way. Only about a third of them are using something that their business is paying for right now. Just put that into context when you're thinking about it, which means they're either paying for something on their own, and that's only 14% more than the third where they're using a business paid item. So there's more than about 40% or so of HR professionals using AI to do their job that is not being paid for that's in a free format. Now are they putting sensitive data out there? We don't know. Are they using it just to do emails? Are they everything you're touching in AI has, a look back to it. Everything has the the the, if you're using free AI, it is being utilized to train some other model. And this is the conversation we're not having enough in our market. And so what we really are telling people that when you're thinking about AI for HR, think about it at a service level service delivery model level. One is, if I'm thinking about all the data that I'm gathering in my organization, where is the place that I have the most accurate, most clean, most valuable data inside my organization? And do I need to do an aggregation environment, some sort of intelligent data gathering? Or can I use some of the workforce tools that I already have? The second question you have to ask yourself is within that service delivery process, where do I need to have intelligent AI guidance? Where do I need to have tactical chat box that just give me nudges? Or where do I have to have an agent that does the work? And it's really important that because you can get overwhelmed with all the different ways today I can help you. Those are the greatest ways to kind of think about how and then the next conversation is how do I go out and look at my embedded solutions or my enterprise platforms or my chat g p t solutions and figure out which of those can to meet those needs for me. The final thing you have to be thinking about in HR is bring your own AI. Cannot emphasize this enough. This will be something your business has to take take into consideration. It is already happening inside your businesses. If you're not managing it, someone else isn't managing it. Look at some very important tools like AffairNow or Elanai that are helping understand where AI is being connected into your system and whether or not it has security risks in it. Because the bring your own AI is not gonna be stopped. Just like bring your own cell phones went from no from almost 2% in in organizations and your own, documents to 70% in a two year period, in the market. We're gonna see bring your own AI because you're gonna get the most outcome from being able to tap in to that trained AI that your individual person has done for themselves. Alright. Last wrap up here is how HR is and your change leader role in that. One is make sure you understand what HR or AI is gonna be used in your organization for. Right now, job descriptions, nature, health questions are the not top two things we're seeing organizations do, especially if they're mid market and SMB. And make sure you understand, how AI is being managed ethically inside your organization. Do not do what we have right now, which is the top two answers. We have no process or I honestly don't know. Make sure you know that inside your organization. Finally, if you're an organization over 10 over 5,000 employees, you're probably looking more at help quest help desk questions, learning and training, some recruiting and onboarding. And you are a little more likely to have an ethics, process in place, but there's a lot of you who don't know what that is. Go find out what that is. Make sure you know it. Make sure you have a copy of it. Make sure you understand how it fits into your own personal HR data. As we're lap wrapping up to date, the last slide I wanna send to you is how do I do this on a budget? How do I think about this when I've gotta keep running HR? And there's two really important things here. One, you have to keep a budget for running your business and growing the business and doing that the way you've always done that. These systems that you're using every day are really critical and not important. What I always recommend is try and carve out 10% both in resources, finances, and maybe even the function inside your organization that is focused on, doing experiments, practicing, doing those kind of things. That's gonna give you the best outcome from what we're seeing from the data in our dataset. It's how organizations kind of restructuring their function to be able to deal with AI, manage it in a way that makes sense, and keep their business running along the along the way, particularly in HR where they need to separate some of these conversations. Cliff, I know I have just run really quickly through a lot of stuff. But, Kate, I know we have a couple of questions, I think, over on the q and a box. And if anybody has any additional questions, we're happy to answer them or they can get some more information from us, afterwards as well. So, do we have any questions we could we can answer? If if there's one if you don't mind, Stacey, I do wanna I've been having some really great conversations, in the chat, and I think I've thrown out a couple things I just wanna clarify because I really am enjoying this. I keep talking about a risk reward model. Yeah. I think, just to clarify what I'm talking about there is the risks that come with AI often have to do with a number of things. Right? You have the ethical considerations. You have the perception, between people who are using it. You have, obviously, a possibility of security and privacy, which is why we were talking about the hyper personalization. And, of course, you have the risk of it being wrong. You know, that is probably one of the big sentiments that people are feeling about AI. Probably what you see more in the news is when there's these hallucinations. So you think in terms of, okay, how do I wanna use AI in my business, which is one of the questions, was a good place to start? I think it you try and use it to solve a specific problem. I would say that is easier than say, oh, start with talent acquisition or start with this. What is a common repeated problem? And then look to see, is that something where AI could help? Is it a case that we're running payroll and there's too many anomalies? Is there a way for it to do run validation checks? Maybe that's not a concern in your business, but you have to find those areas and then see if there's an AI solution to that problem rather than plug and play. There was a really wonderful comment, that was put in where they were talking about something like, put a proof of concept versus, something else that the person who wrote that could write that, you know, where you're basically saying, I just wanna put this in just because it's there. Right? This sort of, issue. So, anyway, I just wanted to go with that. But any other questions? And I'll add to that. I can't you, a Betterworks, I'm sure, probably does like it. Almost every vendor has a risk reward chart they use on what's what's what how they're ranking and rating risk versus reward. And the rural part is what's the outcome you could achieve by using this. And, again, I would go for the business issues first. So enterprise wide, company wide versus your own HR because the thing we hear over and over again from business leaders is that they're they're what's doing it? HR is working. It's not broken right now. What is broken is that my business model is not working because AI is changing it so much. So and I don't know, Kate, if there's some other questions you feel we should answer in our last couple of moments, but I know you had some other that you want to wrap up with too. So Yeah. Do we have time? Oh, sorry. Go ahead, Cliff. I'm just there was one that, I thought you would be best suited to answer, Stacey, and it's about the cluster model. So the idea is, do you see that certain type of things cluster together? For instance, like performance learning and talent, or the performance and talent align better, with other sorry. It's weirdly cut off because of the I I understand what they're asking because because I think, you know, when when we first first started coming out with people like, well, isn't this just the talent suite? Right? Is that what this is? And the answer is no. Actually, we we find that the clusters are very specific to the organization outcome you're trying to achieve. So if you are a manufacturing organization, you might cluster performance more tightly with time because you're you're tracking where people are at and what performance you're tracking at an activity level in that time conversation. You might cluster engagement with learning because you're tying learning in a consulting based firm where development is a much more important conversation to, the, the the engagement of your of your consultants. So I would say the traditional sort of wheel that we've all lived in for so many years is not what we're seeing happen with this cluster model. It is much more about following your business processes, that top business issue that you're trying to deal with, and then making sure that, the solutions that are connected to that cluster are are really tightly lined. And you might have two systems. So, again, this idea that it's all gonna be one is not the answer. It might have two different systems because in learning, I gotta have something that tracks it this way. But when I'm really thinking about time, I'm half track half track this way. And that is a relatively not a bad idea in our dataset from what we're seeing. It is about how well the data is flowing back and forth and then how do you aggregate it up. So And, there's one last question if we have time, Kate. And it's what are your thoughts on HR perspectives on correlation between AI and digital twin of employees? That's a tough one. I mean, our our day we didn't have it in here because we haven't done it for this year yet to see if it's gonna hold true. But our data basically showed that if organizations were using AI and it's not a correlation or causation because it it's a correlation, but it's not we don't know if it's it's causation by any means because it's one year instead of data. The organizations on average received about an 8% bump up, especially if it was embedded AI in HR in an HR, solution. An 8% bump up in, HR talent and business outcome, the aggregate of that. And that was that was pretty impressive to just see that. Again, we don't know. Could be because those companies were already ready to do it. Right? The correlation between treating AI as a as a as a workforce resource, I think, is what they're asking. Right? Is what we're telling people is it it here's my stance on this. We assess and manage and think about engagement and learning and performance for employees at such a high level. I'm not about saying that AI is your best friend. I think there's a a a fear or worry about anthropomorphizing AI and making it like a person, and that that is is not something we should probably be be putting faces on our AI right now. But I do think we should, assess it at as much of a level or even more so of a level of any employee that we assess. We we do performance reviews on a regular basis of our employees. We make sure there's check ins and validations, and and we we we check what Internet sites they're going to. If you're tracking an employee at any level in your organization, you should be tracking your AI just as much. Because even though right now it might be just algorithm written, it will move into decision making pretty quickly based off of updates and upgrades we're seeing in the market. And anything that's making a decision inside your organization should have an assessment model to it and should be calibrated and reviewed on a regular basis more so than you even do your employees. So I think we need to manage risk for AI agents and workforces at a higher level than we do our employees right now. Beautiful. Well, thank you so much, Stacey and Cliff. This was super inspiring and really great data to learn more about AI usage and tons of other great topics. So thank you everyone for attending. I know that at the beginning, we asked you the poll, and you responded. 17% of you said that talent and processes are the biggest challenge for you right now. So we'd love to talk from Betterworks about how we can help. We work with enterprise companies on that very subject. So feel free to scan that QR code to learn more. But thank you everybody for attending. And, again, huge, huge thank you to Stacey Cliff for providing such amazing research. Hope you all have a great rest of your day, and take care. Thanks, everyone. Bye.