Get on the right side of AI for talent acquisition's adoption curve to secure a lasting competitive advantage

For those who are unfamiliar, the concept of the technology adoption curve was popularized by Everett Rogers in his book Diffusion of Innovations. Although some HR tech writers have joked that the overall HR technology adoption curve looks markedly different, with a majority of HR tech buyers disproportionately disposed to the far left of the curve, the true speed of adoption of AI in talent acquisition tracks closely to the standard curve.

The risks and rewards of the 5 categories of technology adopters

The adoption curve categorizes technology buyers as one of 5 subtypes: innovators, early adopters, early majority, late majority, and laggards. Innovators and early adopters are exposed to the greatest amount of risk from adopting new often unproven technologies. However, due to the considerable competitive advantages that may be realized by implementing breakthrough technology, they also stand to benefit the most.

While the innovators and adopters have a greater appetite for and ability to manage risk, for the majority of companies shooting to be part of the early majority is the most strategically advantageous way to implement new technology.

As the curve moves towards the late majority and laggards, risk increases again. However, the risks at the later stages of the adoption curve are defined by a potential loss in competitive advantage. After all, in the late stages of the curve, the technology has been adopted by anywhere from 50 to 84% of the marketplace.

What stage of the adoption curve is AI for talent acquisition in?

A study of 484 HR professionals who worked at a mix of small firms, enterprise organizations, local and global staffing firms found that in 2 years' time 77% of HR organizations will be using AI for talent acquisition.

The same study found that currently, 56% of HR organizations report already using AI for talent acquisition. Because 56% of HR organizations report using AI already, the data suggests that the adoption of AI for talent acquisition has surpassed both the innovators and early adopters.

It’s difficult to assess whether it is in the early majority or late majority due to the varying levels of use of AI among HR organizations that have already adopted AI. Of the organizations using AI for talent acquisition about a fifth use it to a high or very high degree, half of the remainder use it to a moderate degree, and the final half use AI to a low degree.

Self-reported adoption growth projections through 2020 and early 2021 add context and color to this picture. The adoption growth projections are the greatest in the categories of high and very high usage. Both of these were reported by talent acquisition and HR professionals to expand 300 and 400 percent respectively.

The data from Hr.com’s report, the proliferation of many highly publicized stories from global Fortune 500 brands such as L’Oreal who are reporting great success in using AI for talent acquisition to screen millions of candidates, and analyst content from well respected figures such as Josh Bersin, lead us to conclude that AI adoption for talent acquisition has seen nearly 100% acceptance by the early adopter segment and is showing strong indicators of achieving rapid adoption by much of the early majority.

Has AI for talent acquisition actually produced results in the market?

L’Oreal is using AI for talent acquisition to support screening over 1 million applicants to find qualified candidates for it’s 15,000 jobs. Results have been quite positive. One of the stories, L’Oreal publicly shared was that for an internship program with 80 open spots, AI for talent acquisition was used to screen 12,000 applicants. The deployment of AI resulted in saving 200 recruiting hours and enabled L’Oreal to hire the most diverse group of interns to date.

Deploying AI has created positive results by delivering efficiency gains and enabling L’Oreal to further it’s diversity initiatives. But how was AI been received by their candidates? The AI system succeeded in engaging 92% of the candidates it reached out to in conversation and received nearly 100% positive feedback from the candidates. L’Oreal reports that candidates say that the experience of interacting with their AI for talent acquisition was easy and felt personalized.

Is now the right time to adopt AI for talent acquisition?

AI for talent acquisition has been proven in the marketplace. It’s been adopted and is being used successfully by many of the world’s leading Fortune 500 brands including L’Oreal and PepsiCo. AI has also seen significant adoption by leading staffing and RPO firms including Adecco, Advantage Solutions, and Sevenstep.

The market for recruiting AI has seen significant development. Billions of dollars have been invested by VC firms and AI innovators into the AI marketplace. Venture capital funding in 2019 alone for AI in HR tech was projected to reach 5 billion dollars. As a result, today purchasing AI for talent acquisition requires navigating a highly developed marketplace with solutions available to suit a plethora of customer needs from the needs of a small 15 person staffing firm to the vastly different requirements of corporations with thousands of employees and millions in annual recruitment costs.

There is a significant financial benefit for AI adopters. McKinsey estimates that overall, AI could add $13 trillion to the global economy by 2030, with quick to act adopters doubling their cash flow over that period. While the McKinsey projection was not specific to HR, it did consider the HR function, and reports from companies like L'Oreal demonstrate that AI does make recruiting more efficient, leading to time and dollars saved.

The speed of adoption of AI has picked up significantly, which also supports that AI for talent acquisition has reached adoption by the early majority. Gartner reported a substantial acceleration in the adoption of AI by leading companies and found that automating tasks such as automated screening and robotic interviews in HR was the 2nd most important project type and named as a primary motivator by 20% of respondents.

The risks of waiting too long

The market is showing strong and compelling signs that indicate right now is the best time to adopt AI for talent acquisition. Waiting too long to adopt AI could place your company in the late majority or even in the laggard category. The late majority begins to adopt technology when more than 60% of the market is already using it, and the laggards don't adopt after nearly 85% of the market. While waiting for the late majority or laggard stage may have worked with HR technology in the past, there are a few unique considerations to account for with AI that make it more dangerous to wait.

AI is expanding from sourcing and screening automation to offering full life-cycle support. On July 30th, 2019, in his article HR in the Age of AI: Lots of Change Ahead, Josh Bersin wrote, “For us as HR leaders, AI will change every process we touch. The way we source, assess, hire, train, develop, pay, and move people is all being informed by AI." AI technology is expanding beyond talent acquisition and is starting to be used across the entire employee lifecycle. Because of this Bersin believes that AI will cause a bigger disruption to HR than any technology or challenge has over the last 25 years.

AI becomes more powerful and intelligent over time through a process called machine learning. Machine learning is powered by large amounts of data that the AI gathers overtime. Innovators and early adopters have already gained significant competitive advantages simply from adopting AI in its current form. As AI continues to operate and grow in the HR space, it gathers more data and becomes even more powerful. Machine learning has the potential to create an even greater divide between organizations that adopt early and those that adopt late.

With technology as powerful, increasingly pervasive, and transformational as AI for talent acquisition, HR leaders need to be wary of missing the boat. If you're considering adopting AI, stay tuned. In the next article, I’ll cover the types of AI for talent acquisition available on the market today as well as the questions you should ask recruiting AI vendors to help you determine which vendor and solution type is best suited for your needs.