HR teams face increased workloads and decreased budgets, but just as many expectations.

To deal with talent shortages and siloed systems, HR leaders need to think beyond the traditional solutions they’ve long used to manage their global workforces. To remain competitive, HR leaders need real-time data to make fast strategic decisions, enable global compliance efforts, and elevate employee experiences.

This is why successful organizations are turning to AI, not only to automate HR processes, but also to meaningfully address short-term talent shortages and long-term workforce optimization. But exactly where—and how—are HR leaders deploying AI? A new report from IDC sheds some light. In AI-Powered Business Suite for Human Resources, the experts at IDC give an inside look at what your peers are thinking about talent management—along with predictions about the future of AI in human resources.

Overcome talent shortages and technology shortcomings

In an economic environment where disruption feels constant, consistently showing HR’s strategic value is more complex than ever. Human capital management (HCM) solutions can help, but the IDC report is clear: When resource decisions must be made quickly, poorly integrated tools can slow things down and stifle performance. So, how are HR leaders assessing this challenge? What is HCM’s role in overcoming these obstacles? And where does AI fit in?

Here are some of IDC’s findings from its 2024 Talent & Labor Management survey of 512 HR leaders:

Dive deeper into AI’s role in HR success

Fortunately, the latest AI technology is poised to help HR leaders meet the moment. IDC reports that companies cite better tools as their primary approach to talent and labor shortages, and 37% say they’ve seen an improvement in overall people productivity from AI-enabled applications. HR leaders in successful organizations have recognized the critical role AI can play in tackling their most pressing challenges.

Here are a few of IDC’s key insights from the report:

• HR application buyers surveyed said they need solutions that break down data silos, provide real-time insights, and can be implemented by non-technical staff.
• Survey participants identified AI as the most important technology for managing human resources.
• Survey participants said an integrated suite approach that harmonizes data and aligns processes on an AI-enabled cloud platform provides a strong competitive advantage.

The evolution of AI in human resources

But what’s next for AI in HR? The experts at IDC predict a progression for HR management solutions (HRMS): HR applications will start as agent-led at a task level, then lead to agents supporting entire applications, followed by agents enabling overall functional areas.

This evolution would allow specialized AI services to work as a coordinated network, constantly communicating and learning, all while taking cues and simultaneously responding to needs across business functions. This sort of interconnected AI working across an enterprise would be a huge step forward from current HR technology—but with the pace of AI innovation, such a leap may happen sooner than you think.