There is still a lot of “chat, hot air and hype around” the implementation of AI by businesses, according to the global chair of the Chartered Institute of Personnel and Development (CIPD). The signs are there, though, in productivity gains being made by the smartest adopters and the impact already being seen on graduate hiring, of how things might be about to change.
That, says Chris Bones, requires a conversation involving stakeholders from across society, not just C-suite executives.
Bones, who was in Dublin on Thursday for an event involving some of CIPD Ireland’s company partners, says the effectiveness of AI implementation within organisations is still hugely patchy but the technology is everywhere with staff using it – whether in a structured way or not.
Those firms who have the clearest sense of how they can put it to use and are prepared to invest in tailored systems to meet their needs, are beginning to reap real benefits, he suggests. At the other end of the spectrum are those who have felt the need to have an AI policy but have yet to figure out a way to turn that into positive returns.
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“For now, there is a lot of chat, hot air and hype around the whole thing,” he says. “You’ve got investors, shareholders in particular industries who see an opportunity for automation on steroids. There is interesting research from Stanford, though, which suggests that the really significant productivity gains at the moment are being made by those who know what they’re doing and have considered using quite specialist tools on very specialist tasks.
“We’re not seeing a whole lot of back office renewal based on ChatGPT or Claude, and for good reason, because there’s a huge risk involved.”
Bones says the bottom-up introduction of AI into many workplaces is what makes it so different from previous technological shifts. Employees, especially younger ones, are routinely using AI and often placing too much trust in what it tells them while far fewer chief executives fully understand or feel really comfortable around it.
A long-time member, Bones joined the board of CIPD last year, coming to it with a long history of senior HR leadership at large multinationals like Diageo and Cadbury Schweppes, as well as experience of running his own company and teaching at the Alliance Manchester Business School.
His 2011 book, The Cult of the Leader was the Chartered Management Institute’s Book of the Year.
Among his other non-executive roles now, Bones is the chair of the Bar Standards Board in England and says the organisation has had to disbar a number of young barristers for using AI in the course of court cases.
He cites widely reported instances of AI generating case law that is entirely fictional and suggests variations of this susceptibility to “hallucination” pose a risk to any company seeking to introduce the tech without due diligence.
He also expects that while AI has the potential to decimate many of the more junior white collar roles that traditionally started graduates on the road to management, there will need to be a great many people employed to check any information the company’s AI model is producing.
“There are areas like medical research where it can clearly be phenomenally helpful by picking up patterns and many other examples in the worlds of business and services. But I think what’s going to emerge is a whole new class of jobs where human activity is going to have to quality assure what’s coming out of the machine.”
As what comes out becomes more reliable, it’s hard to know where the numbers are going to fall but, he says, “I do think people have learned from the ERP (enterprise resource planning, an integrated management system with its origins in the 1990s) because we did all this huge automation then and there are endless examples of people relying on a system that collapsed and having to bring everybody back on consulting contracts to fix the problems”.
“There’s a sense from the people I’m talking to, the HR people, that no one will want to bet the farm in the way they bet the farm on ERP and that’s probably quite a good thing. You’re going to want to find out slowly what are the right things to use.”
The youth unemployment rate hitting 16 per cent in the UK is just one sign, he says, that AI is starting to make its presence felt on hiring even if there are other important factors feeding into that number.
Overall, things are moving quickly, he suggests, but it is hard to come to firm conclusions about where precisely we are now in terms of impact.
“It certainly has real talent pool implications and the early Stanford [research] is saying there are really interesting signs of structural productivity change emerging now where people are actually starting to put this stuff to work in their organisations, predominantly using these sort of specialist agents and driving growth.”
When other economic indicators are factored in, he says, the evidence suggests AI has the potential “to decimate traditional young people entry points, the people we brought in to do the analytical work that allowed them to learn their trade, whether that’s training as an accountant or a lawyer or a HR professional”.
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CIPD represents more than 6,000 of those HR professionals in Ireland and 160,000 internationally and though Bones believes the HR function will be key to the way companies manage future change and many new aspects to roles will emerge, he accepts there is a great deal of uncertainty, too.
The greater issues are around how companies develop talent in the future and young people are enabled to start their careers, something he says has large societal implications that require “big conversations”.
“We need to invent new career and developmental paths if we’re going to avoid disenfranchising the next generation, prevent them from participating in the economy. That’s definitely an issue for business but it also requires a societal response. And so far, it isn’t sitting on any government agenda I’ve seen.”
