How Talent and HR Leaders Can Embrace AI Disruption

Artificial intelligence (AI) has seen significant growth and adoption in recent years and is transforming how businesses operate.

But throughout 2023, its adoption curve and support by C-Suite leaders went hyperbolic. Why? The emergence of generative AI, based on natural language processing, which enabled anyone to access the power of AI by entering a request (prompt) into a simple interface. Generative AI has kicked off a frenzy of interest just like Netscape’s Mosaic browser did in the mid-1990s. AI has become “consumerized.”

When ChatGPT first launched in late 2022, the service gained 100 million users within the first two months, setting a record for the fastest-growing user base. Now, the platform has more than 100 million weekly active users and is used by over 92% of Fortune 500 companies.

According to research from McKinsey, generative AI is poised to unleash the next wave of productivity and has the potential to add between $2.6 trillion and $4.4 trillion in annual value to the global economy.

Today, leaders are pushing teams to integrate AI, be it traditional or generative, into all their business plans, processes, products, and services. AI is not only disrupting traditional business models—it’s disrupting how we think about talent. This is all part of a greater leadership challenge to embrace digital technologies. In the book, The Technology Fallacy, Gerald Kane and Ahn Philips point out: “The true challenge of digital disruption is people—specifically the different rates at which people respond to technological advances.”

People play a critical role in any organization’s ability to embrace disruptive innovations. Because of this, a modern approach to workforce planning is essential to enabling organizations to be more agile, nimble, and prepared to incorporate AI and other new technologies. Keep reading to learn more about how organizations can effectively embrace AI, how AI impacts jobs, and how HR teams can strategically design their workforces to incorporate new technologies and prepare for the future.

Table of contents:

• Moving from resistance to exploration with AI
• How AI is transforming jobs
• How HR leaders are responding to disruption
• Embracing a workforce ecosystem
• Focusing on a skills-based talent strategy
• Applying AI technology in HR

Moving from resistance to exploration with AI

As is the case with any new technology or disruption, many business leaders are hesitant to embrace AI. Some think AI will be a fad and believe that even though they haven’t done anything to develop or invest in AI, it doesn’t matter because AI is all hype. Others are hesitant due to fear of not understanding (FONU) or not knowing how to prioritize AI initiatives.  

We’ve seen similar forms of resistance in the past. A few examples include:

• Manufacturing and the quality movement. In the 1980s, Japan disrupted manufacturing with new, lean, quality-by-design formulas. In the U.S., this approach was seen as hype and manufacturers thought inspection at the end of the production line was effective enough. These manufacturers ended up falling behind competitors who adopted new lean methodologies.
• The early days of the World Wide Web. In the 1990s, the World Wide Web emerged. Again, many business leaders thought this new disruptor was all hype. Retailers weren’t immediately worried about e-commerce, believing customers would always prefer to shop in stores. Printers shrugged off digital media and were confident that people would always want magazines in their hands and books in their laps. Businesses that resisted the World Wide Web fell behind their competitors who were more eager to embrace change.

When significant change seems disruptive, business leaders and organizations often go through a rollercoaster of change management, a term coined by Ralph Coverdale, a U.K.-based leadership expert around change management.

The change management process involves a specific set of responses to disruption, highlighted in the graphic below. When they get to the bottom of the roller coaster, leaders finally take action because they realize that the latest disruptor is taking away revenue opportunities. Meanwhile, they’ve lost critical time and fallen behind in the battle for the market.

Many organizations are in the shock, rejection, or resistance stages in relation to AI. However, the leaders who will thrive and help their businesses get ahead in the market will make the leap to exploration and be curious rather than resistant. In fact, a global IBM survey of 3,000 CEOs found that while only 50% of respondents are currently integrating AI into their products and services, 75% believe competitive advantage will go to businesses with the most advanced generative AI.

As a business or HR leader, instead of wasting your energy on resisting AI and seeing it as hype, you can take proactive steps to learn how AI works and how adaptive technologies disrupt your market or business. To get started, initial exploration can be as simple as taking a course, reading a book, subscribing to a newsletter, or listening to a podcast about AI. The time and energy you invest to explore is nothing compared to the effort you would otherwise spend later trying to put pieces back together again.

How AI is transforming jobs

As more organizations adopt AI-powered technologies, this shift has the potential to significantly transform jobs. According to research from Accenture, 40% of all working hours could be impacted by large language models such as GPT-4.

While some people may think AI will eliminate jobs, this isn’t necessarily the case. Global research from the World Economic Forum found that 50% of organizations surveyed expect artificial intelligence to create job growth, compared to 25% who expect AI to create job losses. Instead of replacing workers, AI can be used to eliminate tasks, augment work, and even identify new job opportunities.

New jobs have already been created and will continue to emerge to support organizations as they incorporate AI-powered technology and launch AI initiatives. Human capital needs for AI include roles and skills related to data hygiene, data science, software development, AI integration, project management, prompt expertise, and generative AI success, among others.

As organizations explore new AI opportunities and capabilities, teams may not immediately have the defined strategy, budget or resources to bring in full-time AI talent. As an alternative, organizations can benefit from engaging independent talent with AI skills.

Upwork Research Institute data found that the average number of weekly search queries related to generative AI increased 10 times from the fourth quarter of 2022 to the first quarter of 2023. The data also shows that the number of weekly job posts seeking generative AI skills increased by more than 600% over the same period.

In addition to creating new job opportunities, AI will also transform how individuals across business functions work. During a panel at the 2023 World Economic Forum Growth Summit, Richard Baldwin, an economist and professor at the Geneva Graduate Institute in Switzerland, said,

“AI won’t take your job—it’s someone using AI who will take your job.”

‍Embracing AI technology can help automate repetitive work, drive efficiencies, and maximize human potential by enabling individuals and businesses to work more strategically. For example, AI can help marketing teams improve market research and competitive analysis and leverage predictive analytics to make data-driven decisions. And customer service teams can benefit from integrating AI-powered chatbots and knowledge base systems to enhance the customer experience. HR teams can leverage AI-powered chatbots to improve internal employee engagement and experience as well.

How HR leaders are responding to disruption

Incorporating AI and other emerging technologies is only one of many significant changes HR leaders have navigated in recent years. Some of the top disruptors include the global pandemic, the transition to remote and hybrid work, the war in Ukraine, the Great Resignation, and concerns of a looming recession.

Given such change in a short period of time, many HR leaders are stressed, burned out, and considering leaving the profession. A survey by Sage of more than 1,000 HR leaders revealed that 95% of respondents believe HR is too much work and stress, 81% feel burned out and 62% are considering leaving the HR function altogether.

Another challenge businesses are facing is that HR is behind on technology adoption. According to the Sage research, HR leaders aren’t where they want to be with reaping the rewards of HR technology investment. In fact, only 54% of respondents indicated they’re currently using HR automation. Additionally, a report from Valoir found that HR and employee experience are the furthest behind compared to other departments when it comes to seeing success with digital transformation.  

Whether adopting AI or responding to other disruption, effectively managing change can help organizations quickly respond to shifts in the market or business environment. HR leaders and their approach to designing and managing the workforce play a key role in enabling organizations to leverage new technology and prepare for the future.  

Embracing a workforce ecosystem

As the world of work and in-demand skills—including AI-related and other skills—rapidly evolve, organizations need to take a more modern approach to building their workforces. Rather than almost exclusively relying on full-time employees, a modern workforce includes a core group of employees, whom the company nurtures and develops, along with on-demand, independent talent to scale and access new skills as needed.

Taking a modern approach to workforce planning involves embracing a workforce ecosystem that extends beyond traditional full- and part-time employees to enable enterprises to more strategically adapt and adjust their talent, technology, and work. Doing so can help organizations scale with speed and agility and test out new products, technologies, geographies, and other growth opportunities.

According to research from MIT Sloan Management Review and Deloitte featuring 3,700 managers and leaders from around the world, 80% of respondents who intentionally embrace a workforce ecosystem are able to hire the qualified workers they need. Additionally, 91% plan to engage external contributors to help accomplish their organization’s strategic objectives.

While many HR departments are behind on digital transformation and integrating technology, the survey also found that 81% of those with a workforce ecosystem strategy have the data and technology systems in place to manage their workforce ecosystems in a holistic or integrated way.

Focusing on a skills-based talent strategy

A key advantage of utilizing a modern workforce design is that organizations can more effectively access talent with the skills they need. According to research from Gartner, the average number of skills needed for a single job increased 10% year-over-year between 2017 and 2021. In the face of restrictive headcount budgets, hiring managers simply add more skills to a limited number of jobs, creating difficult-to-fill “unicorn” positions.

Rather than facing the challenges associated with finding “unicorn” workers with extensive skill sets for full-time jobs, organizations that embrace skills-based workforce planning move in the opposite direction; they deconstruct jobs. By breaking roles down based on the outcomes they’re meant to deliver, and aligning those outcomes with the skills required, organizations can leverage the workforce ecosystem to align the best resources, including technology, quickly and cost-effectively and fuel their business strategy.

A survey from Deloitte shows that organizations with a skills-based approach to workforce planning are 63% more likely to achieve results than those that haven’t adopted skills-based practices. As in-demand skills evolve, our 2022 Future Workforce Report also found that nearly 78% of hiring managers surveyed who engage skilled independent professionals say they’re confident in their ability to find the talent they need, compared to just 63% of those who don’t tap into the expertise of independent talent.

Here are a few real-world examples of how organizations can benefit from accessing independent talent to meet skills needs and achieve business objectives:

• Microsoft scaled video production. Microsoft is committed to creating informative, engaging video content for customers. As demand for quality video content increased, the small internal team faced challenges keeping up with requests while staying within budget. The team turned to independent talent on Upwork through Enterprise Suite and quickly engaged skilled independent video production, motion animation, and transcription professionals ready to complete quick, low-cost, high-quality video production at scale.
• Kinetic Investments launched two AI businesses. As AI continues to see increased adoption, Kinetic Investments, an investment firm for startups, supported two of their portfolio companies as they launched AI ventures of their own. Kinetic Investments engaged independent talent to scale while driving cost savings. One of the portfolio companies, an AI news website, engaged copywriters, editors, and a social media manager to help power the business. The other company, a mobile app that makes platforms like ChatGPT easy for beginners, engaged a development agency to build the app and a prompt engineer to identify categories, prompts, and other important information.

“We work with many talented freelancers who have skills we don’t necessarily need full time. This approach without a doubt has a significant impact on our business.”
—David Merry, Partner and Co-Founder at Kinetic investments

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Applying AI technology in HR

As HR leaders make progress with modern workforce design, leveraging AI technology can help drive efficiencies within the function itself and enable HR professionals to play a more strategic role in business transformation. According to a survey of Chief Human Resources Officers (CHROs) by The Conference Board, 65% of respondents expect AI to have a positive impact on the HR function in the next two years.

While AI tools offer many benefits to HR teams, the human part of human resources remains essential. Because building relationships with talent and being a trusted advisor to business leaders will always be important to an organization’s success, AI can be used to help HR team members expand the value-added elements in their roles and minimize transactions and administration.  

Some ways to apply AI in HR include:

• Recruitment and hiring. Recruitment and talent acquisition teams can improve hiring by using AI to help draft job descriptions and other recruitment materials, incorporate sourcing tools to engage qualified candidates, use chatbots to drive candidate engagement, adopt resume parsing technology to streamline candidate screening, and build in predictive analytics to determine the likelihood of candidate success. Organizations must be intentional about the use of AI in recruitment and hiring, considering how to guard against bias, promote fairness, and protect privacy.
• Workforce planning. Talent management systems and human resource information systems (HRIS) enable HR teams to centralize worker data, simplifying how companies manage their workforces and automate HR processes. Through these systems, organizations can manage payroll, benefits, and time and attendance, and track key metrics related to engagement, learning and talent development, retention, performance, and future talent needs.  
• Risk management. Some HRIS solutions and similar platforms include risk management capabilities to automatically analyze HR policies, track and review compliance procedures, and assess data quality issues at scale.

Access skilled AI talent and build a modern workforce with Upwork

The era of generative AI is just beginning. Organizations that adopt AI sooner rather than later will gain a competitive advantage over businesses that resist AI technology.

Whether you’re interested in scheduling a consultation with an AI expert, building a custom chatbot to improve customer service, developing your own AI model, or exploring other AI opportunities, Upwork can empower your team to work smarter. Experienced, independent professionals with a wide range of AI skills are available to help you achieve strategic business goals while saving time and reducing operational costs. Learn more and start searching for AI talent today.  

As you rethink your workforce planning, Enterprise Suite, Upwork’s powerful, full-service platform, can also help you access the top 1%, Expert-Vetted talent. We’ll partner with you to help you develop a custom, scalable talent strategy to achieve your specific business objectives and maximize impact.

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Disclosure: Upwork is an OpenAI partner, giving OpenAI customers and other businesses direct access to trusted expert independent professionals experienced in working with OpenAI technologies.

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