How AI is Reshaping HR Strategy: ROI, Talent, and the Human Touch with John Pender

[00:00:00] John Pender: Correlating employee experience metrics with business outcomes is one of the things that comes to mind. Again, sometimes HR doesn't have that seat at the table, but my philosophy is if you don't have a seat, go on the hallway, get a chair and put it at the table.

[00:00:33] Tanya Early: Welcome to Draup Dialogues. It's an exclusive podcast series of industry leaders sharing their views on workforce planning, AI and HR and more. Today we're discussing AI in HR strategies and how to map them to ROI. I'd like to welcome our guest, John Pender, who has worked with the likes of Lockheed Martin, Parsons and AWS in his over 20 year career in HR.

John, maybe you could give our listeners a little more information about yourself before we start the Q&A.

[00:01:08] John Pender: Thank you, Tanya. It's really a pleasure to be here. I've really been looking forward to our time and discussion. So yeah, as you referenced, I've been in both talent acquisition and HR for well over 20 years now.

I've had the pleasure of working with some and for some wonderful companies in that time, as well as several opportunities to live overseas. So I've really been blessed in my career so far. And it's a pleasure to be here and looking forward to talking more about how AI may or may not impact our industry.

[00:01:51] Tanya Early: Great, well thank you. So the first part of the Q&A I'd like to talk about AI game changers for HR. So how do you see AI transforming traditional HR functions like recruitment, performance management, and learning and development?

[00:02:13] John Pender: So one of the first things that, for me anyway, that came to mind was how can AI drive efficiency within the recruitment lifecycle?

And so I think that's a big one. And I know some of this- some of these topics make people nervous but I really feel that's probably first and foremost that comes to my mind. And I see that as really- AI automating resume screening as we get further and closer into natural language processing to be able to analyze words, experiences, qualifications, and then taking that machine learning through algorithms, assessing candidates' suitability by comparing that to current profiles, which would be in an organization's database on their current employees. There's always those portions where employees can go in and fill out their backgrounds.

So being able to integrate those things and really putting together a talent matching process. And from my perspective, I really feel that would also reduce bias. And I know that's a hot topic and we can get into that too, but I really see those as, first and foremost, is just inefficiency for recruitment process.

I think second is, tying into that is, again, data-driven performance management. So what can that look like? AI can, gives a team in this case, maybe L&D and a TM department, the opportunity to be continuously monitoring employees' performance through metrics such as project completion rates, peer feedback, communication patterns. It's all of those things when you're going through employee evaluations and everything and one-on-ones with your manager, monthly, quarterly, all that can be continuously being learned and which then I think those- the sentiments of employees, using those tools to evaluate an employee's engagement while producing personalized dashboards, using that. And then that moves into being able to create personalized developmental plans for folks. And that again, I think one of the biggest pieces for me on this topic is, that allows managers to provide more timely, objective and personalized feedback to their team members.

Because they're not having to create Excel spreadsheets and go digging through HRIS systems. Using an AI generated tool, it's bringing that information to them. And I think those are the two that hit me the most on game changing.

[00:05:27] Tanya Early: Absolutely, I feel like we talk about KPIs so much and, you're right, it's always a battle I think for HR to figure out how to be more efficient. But, you make a good point at the end there where incorporating AI can actually maybe improve that person to person relationship as well. So next question, John, in what ways do you see AI contributing to more personalized learning and development plans for employees?

And how close do you think we are to making that a reality?

[00:06:06] John Pender: So I guess building- building on some of my last comments, I think it's the adaptive learning platforms and personalized training. That's where I see AI being able to, in the near future, I think have a more profound impact and immediate impact in that space.

So for me, what I see that as being is just an AI learning management system. You've got LMS systems now, they've been around for decades, but now, again, going back to what I was touching on is now it's powered by AI. So it's, again to me the big win here is it's bringing the information to the people who need it on a regular basis without them having to go out and data mine it themselves. So analyzing employee skills, language preferences, career goals, and again, delivering a customized training content for that particular person. And I see

that being able to happen across either blue collar, white collar. I just don't see that being an issue like it is a lot of- for a lot of companies now.

Is creating career paths for some of the more blue collar jobs can be really challenging. And I think an AI LMS system can really close some of those gaps. And in addition, I think, machine learning algorithms, tracking that process, adjusting the course based on the data that's coming in,

and what- and again, and you just brought this point up, and this is something I'll probably say several times, and that is we can never lose the human contact. Okay? That's where I think people get a little bit nervous. You are always going to need your leaders to have one-on-ones, from my perspective, just period. But I think these technologies can really enhance what those one-on-ones, entail. And then I know there's companies out there that are already embracing some of this. I won't get into who they are, but they're already using AI, at it in its infancy level, in my opinion, for personalized recommendations and bringing close- closer to being able to create plans that are scalable both domestically and globally. I think we're a ways off. A bit before AI can really provide some of that instantaneous, if you will, coaching and feedback. I think we're on our way but I think that there's some hurdles that, you know, need to be thoughtfully addressed. And some of those I think are just, as I've referenced, around some people's nervousness about it.

And having a machine do it, I think that's where if you are going to bring this kind of technology to the forefront and bring it into an organization, I think that you have to be partnering across the spectrum. It can't just be an IT department saying, okay, we're going to do this, or an HR department saying we're going to do this.

It needs to be those groups. It needs to be communications departments have to be heavily involved in my opinion, to- to make sure that rollout is done respectfully, thoughtfully with honest and clear ongoing communication. To make sure that people understand that this isn't taking away from the human.

So that's where I see that though.

[00:10:17] Tanya Early: Yes, it brings up so many security concerns too. People just, not wanting to discuss their personal information with a robot or an automated tool. And, so.

[00:10:33] John Pender: Yeah, and that's where I think it's just really really important as this continues to develop. Whether it's within the HR and TA realm

or elsewhere- that the communication around it, I think is going to be even more vital and important than

how you roll something out now, within an organization. I really feel that how that's done to make sure that people feel comfortable, they feel secure. There's a lot of things going on in the world and I- so I think, if an organization wants to embrace this that it needs to be a, a joint effort.

Across multiple, areas within their business.

[00:11:37] Tanya Early: Ultimately, it has to come from the top down though. So then you have to start thinking about how are you gonna build that case, right? How do you quantify that? How do you apply an ROI to it? How can HR leaders build that compelling business case, so that they can get executive buy-in for those investments.

And then how do they tie those directly to the key business outcomes like driving revenue growth and things like that. So what are your thoughts on that?

[00:12:06] John Pender: Yeah, it's age old question isn't it, for HR? How do you quantify productivity gains and cost savings, for an HR or a TA

department? I think for me, I think HR leaders can showcase how AI reduces time consuming manual tasks. And like I touched on in the beginning, as an example, like the initial resume screening, performing some of the onboarding characteristics of bringing a new employee on, performance evaluations.

Leading to faster hiring cycles, improved workforce efficiency, I absolutely see where this could have a positive impact on employee engagement. So I think it- it's building, quantifying those in monetarily, I think is really a place to start. So getting those productive gains and tying that then into a cost savings.

So using an HR or an AI-driven AI automation system or tools or set of tools, they can reallocate HR resources to higher value activities. And that would directly have an impact on revenue or productivity. I again, as an example, there are a number of things that a couple of my HR, close HR colleagues are involved in, where they talk about all the time, that it- they wish they had more time for the people.

And so I think using an AI HR automated system can really free up your HR professionals and your talent professionals to focus on strategic initiatives. And that's something else that I've written business cases for, and so I think that's something else that, that HR leaders need to think about.

And then drawing on that case studies and industry benchmarks, going out doing your homework, do some digging to be able to say, here's a peer company or someone in the same industry is always going to be a higher value than taking somebody that's completely not in your industry.

'Cause the feedback is, well they don't do what we do. So go out and do your homework, find the case studies, find the industry benchmarks, and bring those into your business case, demonstrating tangible cost savings, reductions, efficiency improvements and so on. And I think not overthinking it, but setting down, putting together an outline, putting together a plan, and really quantifying the savings, I think this is the first place to start.

I think secondly, you are really linking AI to employee retention and performance impacts. There are some industries that really struggle with employee retention, especially when they can walk across the street for a dollar or $2 an hour more. So how do you use AI in retention and performance impacts?

So engagement tools, like we talked about, to being able to analyze their sentiment, feedback, and proactively address the workplace issues, if there are. Reducing turnover and in boosting employee morale because doing an employee sit down one-on-one evaluations once a year, that just doesn't cut it anymore.

You- there needs to be much more consistency and frequency of these things happening. So I think using an AI power tool will really keep that employee engaged. You're not dropping them something every week, but maybe you're dropping them something every month. And then again, that's being brought in to AI, back to their hiring manager, helping that person to then create a customized talking points.

Customized training program for them. And then that goes right into personalized learning platforms. So ensuring that employees are developing the skills that not just align with the business goals, but align with their goals more importantly. Keeps their passion, what do they love to do?

And I think these AI tools will really enable you to, as a leader, do just that. And then backtracking into the key HR metrics, retention rates, internal mobility, employee engagement scores, they can then take all of that data into their business case. And I really think using those things and those tools, is it gonna be a set of discussions?

Sure, it always is. But I think they can use some of those tools that are available to them. And, really present that case and starting it at perhaps more of a micro level? Making sure they're bringing in their peers before you just take the jump up to the C-suite. And, doing it more at a micro level to begin with and see how that goes.

And then, internally scaling your discussions with the ultimate decision makers in bringing something like that in.

[00:18:05] Tanya Early: And we all know that HR is the last one to- at the table, so- they're always at the end of the table. So hopefully some of those other functions will lead the way for that.

And, within the different organizations, they can look at, all right, how has- how has this different function of been able to push the AI needle and what did they do and how did they quantify that? So hopefully they can take a lead that way and it will like you said, be a company wide initiative.

[00:18:34] John Pender: That's, yeah, no, you're exactly right. And I think that's the really important thing. You, have to, it can't be HR against the world. It has to be just a coalition of the groups within an organization. Getting IT's and tech's buy-in, getting communications and marketing's buy-in, just-

getting manufacturers' buy-in. It's making it more of a coalition, I think just strengthens your case to then make that final pitch to the folks that are going to be writing the check for it. But I think if you do that, again in a thoughtful way, making sure these people are on board, you've got a clear message, you're in sync.

I've gotta believe that the results of that would be a positive one.

[00:19:37] Tanya Early: So what are your thoughts on- on what kind of role predictive analytics is gonna play in this whole process of improving that accuracy and ROI measurements and HR initiatives?

[00:19:56] John Pender: So workforce planning, it's just such a loaded question.

Workforce planning for any organization is gonna be challenging. It just always is. Whether you have a manufacturing portfolio as part of your business or you don't. So, predictive workforce management trends, proactive decision making. I think first and foremost, I think an AI powered tool,

that allows for predictive analytics using the historical data to forecast attrition, forecast engagement levels, and future hiring needs. Again, that goes back to allowing an HR or talent acquisition leader to be more proactive and making data-driven decisions as opposed to saying, well, it's October, we, need to ramp up for the holidays. And then have something transpire where they hire a large number of temporary workers and they don't need them, for some reason.

So I think being able to allow leaders to be able to make data-driven decisions I think will have the largest impact as- as far as that's concerned. And I think what's important is, I've done that a thousand times in my career, tried to pull data out of an HRS system, put it into a spreadsheet, make pivot tables, all that stuff. To have a tool that's bringing that to you,

I know I've said this a number of times, but I just, I can't overstate that. I think that's the big win here. And I think another example, an AI can analyze the patterns in turnover rates and pinpoint- help to pinpoint factors that are leading to high attrition, enabling you to make targeted retention strategies. Then

goes right into what we were just talking about a moment ago, which is saving costs associated with rehiring and lost productivity. So I think those are the big areas. I think another one is around just measuring, performance impact with, once again, real time analytics. So this tool, and this is the really cool thing to me.

Because I've made and developed way too many spreadsheets in my lifetime. I, it is just it- and so to have a tool that can continuously track, funnel those metrics, and you can set those up as an organization, because not all organizations are interested in the same metrics, which is something else that I think is really important to point out.

This isn't just data mining for the sake of data mining. You can allow AI to work for you in setting it up and pulling the information that you value as an organization or as a department. And I think that's something else that's important to keep in mind. Using AI training effectiveness, performance improvement, employee engagement,

I know I've said some of these, but the real time insights into that I think is a huge game changer for organizations using a tool that's AI driven. And then advanced analytic tools, you can compare pre and post implementations. Having access to it, not having access to it. How did that impact HR and talent acquisition initiatives?

Business outcomes, again, being able to make even a stronger ROI assessment and argument. And that's why I think doing it at a micro level to begin with is a nice way to go about it because then you've got proof of concept internally. And you don't have to say, so and so organization is doing it, and here's how you can prove the case internally.

And that's where I've started business cases before. Let me do it in this group and then I'll circle back with you in three months and we can talk about, what those outcomes were. And then maybe we can have that discussion based on those outcomes about how do we scale this then to include the entire company or do we just do it part by part to, to get people used to it.

[00:25:05] Tanya Early: Absolutely, and I- it makes me think about, how do we, how are we going to look at ROI for intangible benefits like, employee experience or satisfaction. How do you assign and quantify a cost or savings to that, right?

[00:25:26] John Pender: Yeah, correlating employee experience metrics with business outcomes is one of the things that comes to mind. Again, sometimes HR doesn't have that seat at the table, but my philosophy is, if you don't have a seat, go in the hallway, get a chair and put it at the table. So I think as it relates to that, the employee experience metrics with business outcomes, it's all about the business outcomes.

So while intangible benefits like job satisfaction are obviously harder to measure in dollars, I feel that HR and TA partnering together can link those factors to tangible KPIs such as reduced absenteeism, higher engagement level scores, improved, Glassdoor ratings, if your company, really looks at that as a key driver.

And then taking those analytics and establishing the correlations, making the business case for the AI investment even stronger. You're- it's never, or I shouldn't say never, it's not always going to be apples to apples. So in some of these cases, you're gonna have to, you're going to need to be a little bit creative in how you take an intangible measurement and turn it into a tangible one.

Then once you've done that, then make it monetary so that it really has an impact and really hits home with the leaders that are going to be making those ultimate decisions. And then, again, AI driven sentiment analysis, pulse surveys, providing, real quantifiable insight

into an employee's satisfaction or workplace sentiment overall engagement. You can't- employee satisfaction, like I said, is intangible, but there are some things

that I think you can do with an AI enabled system to, like I said, make it tangible, make it real, make it- you can reach out and touch it and then turn it into a monetary thing,

and continue to build your case from there.

[00:28:14] Tanya Early: Yep, you mentioned creative, I feel like, HR has always been creative, so this will probably be not as difficult for that function so.

[00:28:24] John Pender: I just, you have to be, yeah.

[00:28:30] Tanya Early: For the last, for the last sort of part of the Q&A I wanted to talk a little bit about trends and maybe some of those challenges, that you think HR will have in adopting.

So maybe some of the key KPIs that, that HR leaders should try to track, to assess what the impact is that the AI is having and then, so what are some of those main ones that come to mind for you?

[00:29:00] John Pender: So, a couple things here for me is efficiency metrics. I think you've got your usual suspects, your time to hire, cost per hire, things that have been around forever.

So utilize- again, utilizing an AI driven automation in recruitment, I think would streamline the resume screening process, streamline interview scheduling, candidate assessment, candidate adaptability for a role, and I think that, those things would have a profound impact on your time to hire, which then automatically has an impact on your cost per hire.

So again, starting with some of the usual suspects, they should track, and this is really important and I've done this in implementations before, the need to track the pre and post implementation, hiring timelines along with the cost per hire to really see what that efficiency is. And the, biggest area that I've had

experience with it is when a company goes from in-house talent acquisition to RPO. Working on the RPO side, as I did for quite a number of years, that was always one of the biggest needs I needed to do leading global programs was I needed to show the customer the value of their investment.

And so it's all about the numbers, it's all about the data. And so I think having an AI driven tool would've made my life so much easier in so many ways. Instead of spending all of my time, instead of trying to be strategic on how I

supported them from a talent acquisition perspective, I was building Excel spreadsheets.

And putting together PowerPoint presentations, trying to show the value and I think being able to have those tools right there, always bringing in the data would just be invaluable as an example. They should also look at, I think it could help with optimizing job placement ads and sourcing strategies.

You look at, you bring in a tool like that, and I think you are better able to then evaluate, you know, would billboards work, for attracting this kind of particular talent in this particular, geographic market space? I know living in the Middle East, one of the things that worked better than anything was just texting campaigns.

Because everybody was using SMS and if you wanted to attract people, you put together creative SMS campaigns. It wasn't advertising on a Middle Eastern focused job board necessarily. It was really, bringing together geographically specific information. Talking to some of the KPIs that HR leaders can track and assess and look at as far as outcomes.

I think going back to, employee experience and retention metrics, again, I know we've talked about some of these things, but it all fits together at every step of the way. And that's, employee sentiment analysis, engagement scores, employee feedback, survey powered AI, providing the real time insights, workforce morale.

HR needs to embrace, tools like this I feel, to be able to monitor the trends in employee net promoter scores and retention rates, internal mobility, and being able to- you're always going to be, you're always gonna need to tell the story. You're always going to need to tell the story, and every day is a different story to try to tell.

And so to be able to have that kind of information and data literally at your fingertips, on an ongoing basis, without it being completely manually burdensome to you as an HR professional or as a talent acquisition professional, I just think would be invaluable. And then, wrapping that up by saying, just correlating all of those metrics into, again, use the tool.

Okay. AI driven initiatives like the personalized learning, like proactive retention strategies, you can quantify and monetize all of those things. And so I think it's an HR organization, talent organization taking those steps, starting with so

bit more challenging, but then finding that happy median on how best to tell that story through the data that you're getting on a constant basis.

I think those are, that's where HR and talent, I think really win here. I really do. I just, having that data, I just see as absolutely invaluable.

[00:35:16] Tanya Early: Absolutely, and it's funny, I had a last question on here that I feel like we've covered already, and it goes along with what you were just saying that data, we keep talking about the data, of course, that means that we need to be- HR needs to have a really close relationship with the IT department and there's, they're gonna play a big role in that. And looking at how that, that happens within the organization.

So what are some, do you have any last minute thoughts on that and maybe some things to think about as you're networking with.

[00:35:53] John Pender: Yeah, you're right IT has to be an obvious part of this discussion. And I think, as I mentioned earlier, I think communications departments need to be heavily involved too,

but from an IT collaborative perspective, I think working with your IT team to ensure data quality. Ensure that the proper integration is happening. And through all of this, make sure that you're getting the output that you were looking for. You're not manipulating the data, this is what you want.

Here's my end game. So working with IT to make sure that the system is set up to pull the proper data so that you are able to talk and speak to all of the things that we've been discussing today. And I think then also aligning those strategies, working with IT and others to align all of those strategies ultimately to the business goals and outcomes.

And at the end of the day, I really feel that tools like this are, like we started off saying game changing. I really do. I think the big piece here is making sure you keep the human in it. So that people don't feel like they're just talking to a bot and you help HR and talent and others within your organization get past and comfort some of those fears that they may have.

Whether you're talking about the C-suite folks, or you're talking about somebody that's on the manufacturing line. How do you communicate the use and usefulness of a tool like this to everybody in your organization? But I think if you do some of these things and you put it together thoughtfully, and you take your time in doing it.

I think at the end of the day, I, I think you're gonna have a pretty strong case to, for any industry to move forward with, implementing, an AI driven, set of tools, whether it's a one stop shop or, whether it's a combination of a couple of things. I just- I, see it the way business is going.

[00:38:40] Tanya Early: It's changing very fast, changing very rapidly. So speaking of Rapid, we have our rapid fire section next.

[00:38:48] John Pender: Okay.

[00:38:48] Tanya Early: Where I get to ask you a question and you provide the first answer. I think that just comes to mind. So you tell me when you're ready.

[00:38:57] John Pender: Go. Yeah. Okay.

[00:38:58] Tanya Early: Okay. Biggest HR myth you wish would disappear

[00:39:07] John Pender: That HR just drains money from the budget.

That's- that's it. And when I say HR, I'm encompassing talent acquisition, talent management or development, all of that. I just, that, that myth I wish would just go.

[00:39:29] Tanya Early: That they're not bringing anything in, it all just going out.

[00:39:32] John Pender: It's all just, it's all just an expense line item.

There's no monetary value there.

[00:39:41] Tanya Early: All right, if you could automate one HR task instantly, what would it be?

[00:39:48] John Pender: Oh my gosh. Selfishly pro- probably initial resume screening. Especially in a market where recruiters are getting hundreds if not thousands of resumes for a single posting. I think being able to use a tool like this to do and screen those down. I know there's arguments on both sides. I get it might not be a popular answer, but if it were up to me, I think that's one of the areas that you would use it.

All right. One skill

[00:40:28] Tanya Early: HR professionals must master to thrive in an AI driven future.

[00:40:38] John Pender: Fearlessness?

You, you gotta get over it. It's, it's happening. And, I think fearlessness of a technology like this, I think is what a skill they need to develop.

[00:41:03] Tanya Early: Absolutely. I agree with that.

[00:41:04] John Pender: Yeah.

[00:41:06] Tanya Early: All right, the hardest part about convincing HR leaders to adopt AI.

[00:41:13] John Pender: We've always done it this way.

Why change?

[00:41:17] Tanya Early: Yep. That is very true.

[00:41:19] John Pender: All of us have heard that. For me, myself, I've heard it way too often, and so I think that's it. It's just, we've always done it this way. We've, been around for, 50 years, 80 years. Why upset the Apple cart? Because, your competitors are doing it.

And going back to everything we've just discussed. Here's some case studies, here's some real life examples, here. This is happening. Okay? And to your comment a couple of times, Tanya, it's happening at a more rapid pace every day. And so you getting on board and understanding that.

Some things need to change and change isn't bad. Actually, like we've talked about also, it's going to help you in your daily, you always say you wanna be strategic, here's your chance. Have the time to be strategic. So I think that's, yeah, that's where I see it.

[00:42:40] Tanya Early: I feel like we covered a lot today.

AI is a topic that I- HR leaders are gonna continue to discuss. And as they're trying to better understand what that impact is on the strategy, how to tie that back to business priorities, how to create the ROI and really just move forward with the adoption, and this was a great conversation.

I really appreciate your time, John, thanks for joining me today.

[00:43:04] John Pender: Oh, no thank you. It is, honestly, it's a pleasure. I've been looking forward to it. Thank you and I'd love to do it again.

[00:43:15] Tanya Early: Will do.

[00:43:15] John Pender: All right.

[00:43:16] Tanya Early: And stay tuned to Draup Dialogues for more such content from industry leaders on what's trending and how to stay ahead of the curve.