AI And Its Impact On Contingent Labor Management

AI will enable businesses to make faster, smarter decisions that drive cost savings and improve the end user experience

One of the most critical tasks an enterprise face is finding and hiring the best candidate. However, strong competition for talent, inefficient recruiting and sourcing processes, and haphazard evaluation criteria make it challenging.  
 

In this context, the possibility of tapping into artificial intelligence (AI) to help with sourcing and hiring contingent workers -- as well as manage and optimize this workforce -- is enticing. Machine learning, predictive analytics and augmented reality offer tantalizing possibilities to increase efficiency, reduce operational costs, grow revenue and improve talent quality.

Business leaders have taken notice, with nearly 3 in 4 considering (2) AI a “business advantage” that will be fundamental to their future operations. Adoption remains in the early stages, with only 20% of executives reporting (3) using one or more AI technologies at scale or in a core part of their business.

AI has been around for decades; however, we have seen major developments over the past 10 years in this space. Innovation has led to the development of intelligent machines that can carry out human tasks. Harnessed correctly, AI will enable businesses to make sense of massive amounts of structured and unstructured data and make faster, smarter decisions that drive cost savings and improve the end user experience. Key subsets of AI include:

• Machine learning: Technology that uses large amounts of data and algorithms in order to analyze and comprehend the information, and then give it the ability to learn.

• Virtual assistants: Natural language processing of text and/or voice to communicate while leveraging real-time analytics and machine learning to help users with tasks.

• Augmented reality: The creation of an enhanced, interactive version of reality that uses technology to overlay digital information onto an existing environment.

• Cognitive computing: Combines machine learning, data mining, pattern recognition, and natural language processing, speech, vision, and human-computer interaction to imitate human brain functions and to help enhance decision making.

• Predictive analytics: Utilizes data, statistical algorithms and machine learning technology to predict future outcomes. 

Although specific functionality may vary slightly based on industry and related use cases, the promise of AI in the contingent labor space is similar across the board. First, it will enable organizations to make better sourcing and hiring decisions. Secondly, it will allow businesses to more efficiently manage their contingent workforces. And finally, it will enhance the user experience.

AI is a broad topic with wide-reaching implications for organizations and their business processes. The following four areas stand out as having intriguing application specifically to contingent workforce management:

The best VMS platforms offer guidance software aimed at making users’ workflows easier, simpler and more efficient. The next frontier in this area is AI-powered embedded intelligence, a form of virtual assistant that would help users with tasks throughout the contingent workforce management lifecycle. Business processes, managerial preferences and company policies could be built into the system to help the virtual assistant “bubble up” more relevant suggestions. Advances in this type of functionality will drive user engagement and deliver better customer experience.

One of a vendor management system’s most critical functions is helping hiring managers find the best candidates to fill job openings. AI can help take this matching to the next level, using machine learning coupled with adaptive online assessments and games to predict job performance for specific roles. Employed in this fashion, AI could potentially enable hiring managers to make wiser decisions that would decrease time to fill, maximize talent and reduce cost.

Today, there’s a wealth of social and behavioral data available over the web, social media networks and more. However, it’s been difficult for organizations to harness this unstructured data. Advances in cognitive computing and deeper machine learning are starting to enable businesses to put this data into action. One of AI’s biggest strengths lies in its ability to sift through millions of unstructured data points and make sense of them quickly.

Enterprises could leverage this functionality to mine social and behavioral data and use it to better match job candidates to open positions.

What if you could take an inanimate object and make it come to life? With augmented reality, this once-hypothetical scenario can become actualized. With a simple wave of the phone, an employee can watch related videos and even have a two-way conversation with a company handbook. With contingent managers and workers alike increasingly on the go, the ability to leverage augmented reality to bring a company’s physical locations or workspaces to life has exciting potential to improve efficiency.

The increased integration of AI into existing technologies is poised to unlock a wealth of opportunities for companies. By analyzing data sets and performing automated work behind the scenes, AI promises to enable faster decision-making and free up valuable resources for stakeholders. Moreover, AI has the potential to provide a wealth of insights that both confirm and dispute previously assumed hypotheses. Employed strategically, these ideas could reveal new ways to increase hiring success and deepen understanding of a company’s workforce. Combined with human expertise, this augmented intelligence will help businesses drive cost savings, increase talent quality and improve the effectiveness of their contingent workforce programs.

1 - CareerBuilder, “Nearly Three in Four Employers Affected by a Bad Hire, According to a Recent CareerBuilder Survey,” Dec. 7, 2017
2 - pwc, “Bot.me: How artificial intelligence is pushing man and machine closer together,” April 2017
3 - Harvard Business Review, “A Survey of 3,000 Executives Reveals How Businesses Succeed with AI,” Aug. 28, 2017