Startup XOR is developing AI chatbot technology for recruiters of multinationals like Heineken and IKEA, and exemplifies one of the most disruptive trends set to transform human resources in future.
The newest addition to human resource departments of global corporations might not be human after all: The chatbot and AI-supported cognitive recruiter is a trend “at the early stages of a revolution”, according to last year’s global study on human capital trends issued by Deloitte.
Talent acquisition is one of the biggest challenges for today’s companies – over 80 percent of respondents call it important or very important. At the same time, there are frequent complaints that it is costly for employers, time-consuming for recruiters, and discouraging for applicants.
As former top recruiter at a large staffing agency in Eastern Europe, Aida Fazylova became increasingly dissatisfied with the inefficiency of traditional recruitment processes. Instead, the former data scientist and mathematician founded XOR on the notion that chatbots and AI can partly solve the problem.
The idea? Chatbots can relieve the recruiter of routine tasks, especially a tedious pre-screen process. Popular employers often receive three-digit application numbers, accelerating costs of filtering out those candidates who do and do not fulfill the desired requirements.
“Nobody wants to accidentally miss a most suitable candidate. Yet, nobody wants to spend time on carefully examining hundreds of candidates when most of them are obviously unsuitable for the job”, says Aida Fazylova.
Indeed, for more than half of respondents of a recent survey, the most difficult part of recruitment is identifying the right candidates from a large applicant pool, says HR tech company IDEAL.
At the same time, applicants might also save a lot of time and resources when they can themselves better understand if they are qualified for a job or not – and it might actually save applicants from more serious consequences.
“If you get on their nerves, they can (and will) blacklist you from future opportunities”, warn career advice sites of applications that do not fulfill requirements.
Indeed, a large-scale survey of 1,500 recruiters and hiring managers and found that such irrelevant applications was the biggest turnoff for 30 percent of them. And of that group, 43 percent said they would ‘blacklist’ those candidates from any other jobs as well – by suppressing their names from even coming up in future resume searches.
“It’s not that human recruiters aren’t able to pre-screen candidates better than chatbots. It’s just that most of the time they won’t pre-screen them anyway”, says XOR-founder Fazylova.
The same is true for the communication with applicants, she adds. Soaring application numbers mean that a large number of applicants never get any type of response from the company. For example, three out of five graduate applications in the UK never get notified if their application was successful or not.
“It’s not that applicants don’t want to have a conversation with a person. It’s just that most of the time they won’t have it anyway”, Fazylova summarizes.
Companies also turn to chatbots as part of their efforts to promote more diversity at the workplace, as gender or racial bias in recruitment processes remains a big concern.
A 2016 study conducted with 40 major companies showed that 30% of companies preferred French-sounding names. Similar studies have been replicated in studies from Canada to the UK, even causing desperate measures such as applicants with names of ethnic minorities to change their names when applying.
Furthermore, job descriptions might be prone to gender bias as research demonstrates that words like “dominant” or “competitive” are stereotypically perceived male and can deter female applicants.
AI-supported technology is turned to as a solution that automatically identifies and remove these types of bias from job descriptions up to the recruitment process.
While the buzz around AI and chatbots in recruitment is difficult to ignore, companies often still face a lot of challenges implementing the technology.
According to the 2018 Global Human Capital Trends report from Deloitte, “the hard part is often not decoding human language but training the software to ask the right questions, provide the right answers, and avoid alienating the job candidate”.
Furthermore, ivercoming data availability challenges as well as addressing the ‘human factor’ is critical for any AI project, according to technology experts from SAP in a Harvard Business Review article.
“Many employees worry about the consequences of all of this technology on their roles. For most, it will be an opportunity to reduce tedious tasks and do more, but it’s vital that employees have incentives to ensure the success of new machine learning initiatives”, they advice.
Investments from company in artificial intelligence are soaring, and a recent study by PwC says that two-thirds of business executives say AI solutions implemented in their businesses have already increased productivity.
The question most companies will likely to struggle with in future is not if they should turn to AI to aid recruiting, but how – opening an opportunity that startups like XOR are eager to jump on.