AI continues to spark discussion and controversy over its potential to replace various human- centered tasks. While AI holds the promise of transformational change, small business owners must recognize that the technology can never fully replace certain aspects of a business — particularly when it comes to the human capital management function, where the emphasis is on humans.
In today’s climate, the modern HR team continues to evolve to meet current business needs and create maximum impact. While technology plays a key role in this, a stronger focus on people operations will help move the needle even further.
In the midst of rapid digital advancement, striking the right balance between incorporating cutting-edge technology and the indispensable role of human employees may be challenging, but is nonetheless critical to business growth and success.
The Promise of AI
AI-powered technology is undeniably important for the future of small businesses who are seeking to find the right resources for in-house functions and automate processes where it makes sense. According to the 2023 Bipartisan Policy Center and Morning Consult poll, 83% of small business owners who use AI say it has been helpful in improving systems, increasing efficiency, focusing time on more valuable tasks, and helping produce content.
Automation and amplification are at the heart of AI’s biggest strengths. Through automation of routine or repetitive tasks, AI frees up employees to focus on more complex, strategic and high-value endeavors– saving time and money and fostering professional development.
For example, AI can be leveraged to help People leaders ensure that employees continue to experience individual and career growth. AI-powered employee surveys can help assess and analyze individual performance according to their defined roles. This can help better direct an employee’s career path and optimize job roles and responsibilities. Taking this one step further, this AI output can be further enhanced when People leaders put these survey results into context with what they personally know of employees through regular interactions and conversations.
The Limitations of AI
There are also many areas where AI can’t automate the human touch or replicate the best assets that people can offer growing businesses. First, AI can’t stand in for emotional intelligence and understanding that enables people to make more nuanced decisions. In People Operations, for example, AI-driven performance evaluations may prioritize quantifiable metrics, but undervalue softer skills. With hiring decisions, AI can analyze resumes based on keywords and qualifications, but may overlook intangible qualities like cultural fit and potential for growth.
AI also falls short in the creativity and problem-solving department. While AI is effective in executing against predefined tasks, its algorithms are not designed to, nor are they able to offer creative solutions to modern business problems. The responsibility of making ethically-sound decisions still lies with humans. The same can be said for open and transparent communications, which is what every high-performing People Operations team should prioritize. But AI is not built to handle possible miscommunications or misunderstandings in the workplace. Finesse and tact in communications are still the domain of skilled people leaders.
This is also true when developing the mission, vision and values for a company. AI may be able to suggest appropriate language, but will that language truly reflect the unique personality and nuances of the company and its culture? Certainly, ensuring companies stay on track as they advance their mission/vision and live out their company’s values requires human oversight.
Finding Balance
Balancing the benefits of AI with the power of the human touch starts with businesses understanding exactly what AI can and can’t achieve. AI can serve as a valuable ally, offering businesses meaningful gains through automation of tasks, streamlining of processes and amplification of strategic roles. But AI cannot deliver the level of judgment, innovation and communication required to make the most informed business decisions.
The true potential of AI is realized when complemented by the human element – the intuition, empathy, and creativity that drive meaningful connections and business outcomes. As businesses lean into HR technology stacks, they must remember to keep humans in the driver’s seat, guiding the organization (and the technology it employs) toward sustainable levels of growth and success.
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ABOUT THE AUTHOR
Matt Gardner
Co-Founder & CEO, Hiline
Matt Gardner is the CEO and Co-Founder of Hiline, a leading financial services firm that delivers scalable accounting, human resources, tax, and payroll services to growth-minded companies, small and midsize businesses, and non-profits. Following his experience as a CPA and auditor, Gardner started and ran Gardner & Capparelli, a boutique, integrated services accounting company for small and medium sized businesses. Through expanding the company and working with innovative companies, Gardner recognized a glaring opportunity to modernize back-office operations and disrupt traditional accounting with a modern approach and integrated technology. Hiline was born out of that mentality and serves hundreds of clients today as a leading provider of financial-operations-as-a-service that helps growth-minded organizations manage risk, improve outcomes, and make better decisions. Gardner is a Certified Public Accountant and earned his BS in Accounting from SUNY Oswego. His entrepreneurship also extends to hospitality as an owner of multiple restaurants, activity in commercial real estate, and as an angel investor in early-stage technology companies.