CHROs more cautious about AI readiness and adoption than C-suite peers, survey finds

Dear CEOs: Have you asked your CHRO for their opinion on your organization’s AI transformation lately? It might surprise you.

CHROs are less optimistic about the AI readiness of their organization and workforce than any other C-suite executive, a recently published survey of more than 800 global executives by management consultancy Protiviti found.

Just 13% of CHROs surveyed strongly agreed that their organization’s jobs are ready for an AI redesign, compared to 28% of all C-suite execs, and 88% of IT leaders (the most optimistic respondents.) Similarly, only 14% of CHROs agreed that their org’s learning capabilities were AI-ready, vs. 36% of the C-suite and 96% of IT leaders.

Unprepared. Previous research from Boston Consulting Group found that 70% of the value of AI transformation comes from employees—how they are trained and how their jobs are retooled—not the technology itself. But companies seldom invest that much money or effort in the workforce aspect of AI transformation. This could fuel hesitancy among CHROs, who often oversee learning and development programs.

“As we learn more and more about AI and what great looks like and how to drive full value realization out of AI, it’s becoming more and more clear that it’s less about the technology and more around things like people enablement, upskilling, manager effectiveness, redesigning jobs,” Fran Maxwell, global leader of people and change at Protiviti, and a co-author of the report, told HR Brew.

Other executives may not have this realization, though. Tasks critical to AI transformation, like job redesign, may sound easy on paper, but they’re uncharted territory for many organizations, Maxwell added. “They [HR leaders] have a different point of view on the people impact, and it’s not as easy as just implementing the technology,” he said.

Be proactive. CHROs’ caution may result in them taking a more reactive approach to AI.

For example, most C-suite leaders surveyed by Protiviti said their organizations currently use AI to improve processes and productivity; only one-tenth currently use it to create value for the business. But respondents believe that, in three years, business value creation will be the primary reason for AI investments.

Well, most respondents. CHROs were the only executives who disagreed. According to the data, they believe business value creation will come second to efficiency.

HR leaders should proactively partner with their fellow business leaders, Maxwell said, helping them understand how jobs may evolve with AI, how the skills required of their employees may change in tandem with that evolution, and how to acquire or develop talent with those skills.

“In order to help drive value realization within the business, the mindset shift in HR needs to shift from one that’s very reactive to very proactive,” Maxwell said.

CHROs should start by looking within their own function. More than 75% of all executives surveyed believe their organization’s core HR functions are ready to support an AI-augmented workforce. But HR is the function with the lowest AI adoption rates: 11% of CHROs surveyed said at least one-quarter of their function has adopted AI tools. By comparison, 57% of IT leaders reported the same, the highest of the C-suite.

HR leaders’ outlook isn’t much brighter. Only 5% of CHROs expect half of HR work to be AI-enabled by 2029, while 50% said the same about one-quarter of the work, the lowest of any function in the survey.

It’s critical that HR leaders “put the mirror up to themselves” and focus on how jobs, and skills, are changing within their function, Maxwell said. Doing so may help them earn credibility with their peers, he added.

To be fair, HR leaders face real challenges ahead, Maxwell acknowledged: their own teams are likely at capacity and under pressure to do more with less, and many HR practitioners might be resistant to change. While focusing on first steps, like automating rote tasks, is important, CHROs should ensure that their own team is part of the mindset shift from reactive to proactive.

“I think it’s a great time to be in the HR function, probably the most pivotal time in at least my 30 years,” Maxwell said. “But it’s also a time where, if HR doesn’t get their act straight and transform and drive, they have a really good chance of being left behind, and these other functions that are going to do HR work are going to pop up within the business.”