International Journal of Information Management Data Insights 4 (2024) 100208

Contents lists available at ScienceDirect

International Journal of Information

Management Data Insights
journal homepage: www.elsevier.com/locate/jjimei

The adoption of artificial intelligence in human resources

management practices
Nishad Nawaz a, *, Hemalatha Arunachalam b, Barani Kumari Pathi c, Vijayakumar Gajenderan d
a
Department of Business Management, College of Business Administration, Kingdom University, Bahrain
b
PG & Research Department of Commerce, Sri Kanyaka Parameswari Arts & Science College for Women, Chennai 600 001, India
c
Department of Commerce (Hons), Sri Kanyaka Parameswari Arts & Science College for Women, Chennai 600 001, India
d
Department of Commerce, Sir Theagaraya College, Chennai 600 021, Tamil Nadu, India

A R T I C L E I N F O A B S T R A C T

Keywords: This study explores the impact of Artificial Intelligence (AI) on Human Resources Management Practices. By
Artificial intelligence focusing on key outcomes such as accuracy, automation, computing power & capacity, real-time experience,
Human resource management practices personalization, and time-saving & cost saving. The research aims to identity the potential benefits of AI
Automation
adoption. Data from 274 IT employees in Chennai City is Collected through a well-structured online question­
Accuracy
Computing power & capacity
naire. Using IBM SPSS version 21 software and AMOS version 21 is used for analysis, the study proposes a novel
Real-time experience research framework. The findings indicate that variables like Accuracy, Computing Power & Capacity, and
Personalization Personalization significantly influence Time-Saving & Cost Reduction, while Automation and Real-Time Expe­
Time-saving & cost reduction rience do not. The novel contribution of this study lies in its exploration of the specific outcomes of utilizing AI
Technologies in Human Resources Management Practices. By focusing on key variables such as Accuracy,
Automation, Computing Power & Capacity, Real-time experience, Personalization, and Time-Saving & Cost
Saving, the research provides a comprehensive understanding of the expected outcomes when implementing AI
in Human resources Management and the relationship among those outcome variables.

1. Introduction Brief Chronicle of AI: On the Present, Past, and Future of AI, has defined
AI as “a system’s ability to interpret external data correctly, to learn
After almost sixty years of evolution, Artificial Intelligence has from such data, and to use those learnings to achieve specific goals and
become ubiquitous over past two decades (Morgenstern et al., 2021). AI tasks through flexible adaptation” (Haenlein & Kaplan, 2019; Morgen­
technologies have begun to consistently grow and gain considerable stern et al., 2021).
prominence in almost all the fields, including medicine, engineering, The fast-paced development of AI would transform people’s personal
agriculture, organizational management, tourism, transportation, and lives and how firms network with their employees and customers. This
so on (Mintz & Brodie, 2019) and have entered both the public and new technological revolution at its core is disrupting the organizations
business environment (Haenlein & Kaplan, 2019). The AI applications and workplace. Technological innovations like AI are transforming the
and technologies prevailing today are not a worldwide recipe; instead, workplace and changing when, how, where, and by whom the job
they act as a workshop with many tools for performing different func­ should be done (Ravin, 2017). Industries are undergoing significant
tions and tasks. These tools are presented in the form of some software or digital upheaval, with a prominent shift towards the integration of AI in
gadget with accessible user interface possibilities and are decision-making processes to ensure the success and growth of com­
well-developed and designed. It is vested in the hands of the individual panies (Varsha, 2023). Organizations are compelled to upgrade their
(knowledge engineers or AI developers) to select the right tools and use organizational functioning and develop their human resources’ skill sets
them in a sensible way appropriate to the task to be performed (Ertel, to achieve optimal company performance (Wiradendi Wolor, 2020). For
2011). So, from the discussion mentioned above, AI will shift a regular quite some time, companies have started to recognize the inevitability
part of our regular lives very soon, like the internet and social media. and significance of AI in managing human resources to survive the
When it comes to the definition of the term AI, Kaplan, in his paper “A rapidly changing environment and outshine amidst tough competition

* Corresponding author.
E-mail address: n.navaz@ku.edu.bh (N. Nawaz).

https://doi.org/10.1016/j.jjimei.2023.100208

Available online 20 January 2024

2667-0968/© 2023 The Author(s). Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-
nc-nd/4.0/).
N. Nawaz et al. International Journal of Information Management Data Insights 4 (2024) 100208

(Waheed et al., 2019). Since AI has penetrated almost all fields and Automation, Computing Power & Capacity, Real-Time Experience, and
gained a great deal of attention, researchers are now focusing on con­ Personalization (Causal variables) in the functions of the Human
structing strategic human resources management practices backed up resource and, also to find out whether the above mentioned five out­
with AI technology (Wang et al., 2020). Organizations all over the world comes of using AI in HRM leads to Time Saving & Cost Reduction
are faced with challenges to shrink costs and save time, and now it is (outcome variable) in Human resources functions in Selected IT com­
identified that the combination of technologies similar to the Internet of panies in Chennai City. As a contribution, the research seek to inform
Things, Machine learning, and AI in the management process as a stra­ both the professions and academic community with insights of potential
tegic element can help to tackle these challenges (Hemalatha et al., outcomes of using AI in HRM and the outcomes may lead to Time Saving
2021). Undoubtedly, AI has a hopeful future in Human Resources & Cost reduction.
Management; however, integrating AI in HR processes involves chal­ To address the research question, the study will delve into the
lenges like AI can work efficiently like a human being only when pro­ literature review on AI technologies in HRM, exploring their outcomes
vided with quality data and chances that the confidential documents and (Section 2) following the Introduction (Section 1). Based upon the
policies shared by the organizations may be misused. extensive literature review, the study also present a conceptual frame­
Despite these AI-related challenges, companies are still showing in­ work diagram, illustrating the relationship between the potential out­
terest and putting significant effort into incorporating AI in HR functions comes of adopting AI in HRM. Further, in the Methodology part (Section
because the benefits of using AI in HR overshadow the observed chal­ 3) the study aims to test hypotheses about the relationship among the
lenges (George & Thomas, 2019). Organizations can enjoy AI’s total potential outcome variables based on previous findings, theory or both.
benefit and potential if they are prepared to transform their workers to The result part (Section 4), and discussion (5) will attempt to clearly
work with intelligent machines efficiently. This process undoubtedly understand the expected outcomes of incorporating AI technologies in
will be time-consuming, but the benefits will be enormous (Mathipriya HRM and shed light on the relationships among the outcomes. The paper
et al., 2019). During the lockdown situation and the crisis created by the dismisses with a conclusion (Section 6) and ideas for further research
COVID-19, the HR of the organizations did not concentrate on perfor­ studies.
mance; instead, they focused on agility, resilience, and bouching back.
According to the qualitative research done by Boston Consulting Group 2. Literature review
Survey 2020, although the productivity level was maintained during the
pandemic, executives were more concerned about the employees’ stress 2.1. Role of AI in HRM
level and well-being. The crisis triggered digitalization, and HR func­
tions rapidly transformed to a digital and automated platform-almost all The role of AI in Human resource management has been steadily
phases of HR functions starting from hiring, onboarding, performance increasing, transforming the way HR processes are carried out almost in
appraisals have been reinvented in the digital realm (Minbaeva, 2021). all key areas of HRM. Due to the substantial volume of data related to
AI applications enhance the HRM functions by boosting their efficiency organizational operations, workforce management, AI has been
and effectiveness, leading to improved employee experience and better increasingly integrated into various operational HR procedures. This
facilitation of performance within organizations (Garg et al., 2022). integration aims to bolster sustainable business frameworks, as noted by
When it comes to AI in HRM, AI technologies offers promising so­ Votto et al. (2021). The adoption of AI in HRM facilitates easier access to
lutions, from automating repetitive teasts to enhancing HR processes highly skilled individuals for organizations, leading to efficient
with neutralized biases. As AI continues to transform workplaces, or­ recruiting process (Meshram, 2023). The intelligent AI technologies
ganizations are recognizing the need to upgrade their HR practices to offers a fresh approach to personnel management enhancing overall
achieve optimal performance and survive in the competitive landscape. company performance and presenting diverse opportunities for perfor­
At this juncture, although we have a theoretical familiarity with con­ mance management (Khaled et al., 2023) and (Hemalatha et al., 2021).
cepts like AI, Automation, and Robotics, research on the application of AI-based training enables organizations to evolve into knowledge-driven
AI in the management of organizations is deficient. As a profession, entities capable of catering to personalized training needs and
Human Resources management is confronting several disruptions; both enhancing the quality of learning (Chen, 2022). The growing adoption
academics and HR practitioners need to pay attention and reframe the of AI in HRM is driven by its ability to generate value for customers,
HR procedures. (Minbaeva, 2021) stressed that as a field of practice and employees, and organizations alike (Chowdhury et al., 2023).
research, HRM shows insufficient fine-tuning. Even though organiza­
tions realize that AI can cut down time and effort by the HR manager, by 2.2. Potential outcomes of artificial intelligence technologies in HRM
freeing up time and resources that can be strategically enhancing the
overall productivity of the organization (Meshram, 2023), organizations 2.2.1. Accuracy
do not have a comprehensive understanding of these intelligent tech­ It has been an up-and-coming trend of using AI technologies in
nologies and the impacts of utilizing those technologies in HRM at an Human Resources management for the last two decades. Studies have
organizational and specific employee level (Vrontis et al., 2021). found that AI provides promising solutions for human resources people,
Embracing the AI workspace can lead to improved employee satisfac­ starting from screening applicants to the employee retention stage by
tion, better work-life integration, and enhanced overall productivity taking over time-consuming and repetitive tasks of HR team, enhancing
(Malik et al., 2021). There comes a need for a better understanding the quality of the HR processes with neutralized biases (Hmoud &
about the expected outcomes of deploying AI in HRM and relationship Várallyai, 2020).
among those outcomes.
Therefore, this study aspires to analyze the academic inputs 2.2.2. Automation
regarding the utilization of AI technologies in Human Resources man­ Organizations are using AI technologies to automate their repetitive
agement, identify the potential outcome and the influence of outcomes tasks and help in intricately planned decision-making more precisely
on each other. Hence, the research question guiding the study is through extrapolative algorithms (Parry & Battista, 2019). Machine
learning technology can predict the future and detect problems more
1) What are the potential outcomes of adopting AI in HRM? accurately than humans. AI will undoubtedly outperform humans in
2) Does the expected outcomes variables are influencing each other. applicant selection when it comes to the hiring process. Moreover, it can
also overcome certain biases often present in the hiring process. AI can
The research questions brings the novelty of the article to know reduce human errors and risks and give the best results accurately.
whether using AI in Human resources management results to Accuracy, Chances of mistakes or errors are almost nil, and AI can achieve greater

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precision and accuracy. AI technologies do have optimistic outcomes, i. 2.2.5. Personalization

e., time-saving, cost-effective, accuracy, bias-free, and reduced work­ AI can sense, investigate, study, and operate in a personalized
load (Hemalatha et al., 2021). The recent advancement in AI has approach like a human usually does (Khatri et al., 2020). Organizations
enabled the automation of systems to experience a complete conversion are using chatbots to help applicants and employees to provide
(Agostinelli et al., 2020). Integrating the Natural learning process with personalized instructions and support according to their requirements.
deep learning algorithms produces remarkable outcomes like the Nowadays, conventional pay and benefits methods are replaced with
translation of speeches or text of human language, extraction of insight personalized packages to meet organizational and individual goals. HR
from human language, and automatically generating content from nat­ professionals, along with AI, can administer flexible and personalized
ural language (Bongarzoni & Marturano, 2020). AI has benefited the HR compensation systems. Moreover, AI can eventually optimize the pay
people by automating administrative and rhythmic tasks (Vedapradha and benefits, reducing employee attrition and increasing employee
et al., 2019). There are a lot of administrative-related works for HR engagement (Hughes et al., 2019b). AI can indeed facilitate the concept
people which are essential, as well as redundant in nature, like job of mass personalization in employee training and development. AI en­
posting, sourcing, screening, arranging interviews and meetings, pre­ ables the organization to identify the individual needs of the employees
paring schedules and timesheets, recording and verifying accounts, and and groups of employees and provide training accordingly. AI can offer
so on (Baggio & Omana, 2019; Langer et al., 2019; Nawaz & Gomes, virtual personal mentors to the employees according to their needs
2019; Niehueser & Boak, 2020; Nocker & Sena, 2019; Savola et al., n.d.). (Maity, 2019). AI-supported systems for estimating real-time assistance
Suppose all these tasks can be automated using AI. In that case, it will for sites using data accumulated to implement personalized suggestions,
enormously benefit the HRs by relieving them from routine work and explications, or options to customer’s/employees queries or inquiries,
committing more time to creative and strategic thinking and seldom even very complicated problems (Xu et al., 2020).
decision-making (George & Thomas, 2019). AI automation enables the
job to be fragmented into discrete responsibilities that can be delivered 2.2.6. Time saving & cost reduction
efficiently by several means, from mechanics to devices (Ravin, 2017). (Sołek-Borowska & Wilczewska, 2018) stated that the AI-based HR
processes with a competent and skilled HR team can undoubtedly reap
2.2.3. Computing power & capacity benefits of lessening timespan and reduced costs. The use of contem­
The modernized businesses pact with a tremendous volume of data porary technologies like AI in the HR process ensures the achievement of
and information, and the companies must transform themselves intel­ the given project and allows business enterprises to reduce time and
ligent and creative utilizing technology like AI (McCarthy et al., 2019). costs. One of the key benefits of using AI in HR is the limiting costs, and
AI is deliberately designed with the purpose of great potency, profit­ ML(Machine Learning) algorithms can actually reduce the risks associ­
ability and to support humans in reducing their monotonous re­ ated with hiring inadequately skilled/qualified candidates or rejecting
sponsibilities (Khatri et al., 2020). AI and Human resources together can appropriate ones and hence reduce costs (Gromov et al., 2018). The
enable managers to monitor human resource configuration in real-time, organizations aim to implement AI-based automation processes across
tap the potential of human resources, which in turn can improve the the HR functional areas, minimizing human effort and reducing the time
overall management and work efficiency and helps to realize the high spent on routine work (Nawaz & Gomes, 2019). Cognitive HR Systems
quality and progression of firms (MaWang et al., 2020). The computing will enable finding and holding talented employees within the organi­
power of AI has enabled automation and thereby father analysis of zation and building their market advantage at a reasonable cost
massive organization data with the aid of AI technologies and Big Data (Chwastek, 2017). Firms utilizing AI for the recruitment process have
(Pillai & Sivathanu, 2020). AI-enabled learning systems can offer indi­ realized decreased hiring costs with increased efficiency (Johnson et al.,
vidual employees a personalized and customized training program. 2020). Using AI in the HRM process simplifies all operations and is
These are likely to aid an enormous increase in employees’ productivity cost-effective (Nawaz, 2019). AI always considers the charge of features
overall and hence help enhance their potential and capability (Iqbal, that are intended in real-time (Ghasemzadeh et al., 2015).
2018). It is accepted that AI has several possible advantages when being
executed in HRM. In the opinion of academicians, research scholars, and
2.2.4. Real-time experience AI specialists, it is affirmed that technologies of AI do impact the HRM
AI chatbots enable real-time employee engagement and digitization process with inherent results. So based upon the extensive literature
of the HR processes like candidate screening and interviews (Vedap­ review, Accuracy, Automation, Computing Power & Capacity, Real-
radha et al., 2019). Through means of AI, organizations nowadays can Time experience, Personalization and finally Time-Saving & Cost
capture and process data in real-time and use that updated information reduction are the potential outcome of AI adoption in HRM
in the decision-making process (Hughes et al., 2019a). AI systems open
up the chances for design an automated real-time employee feedback 3. Theoretical background
system that can get feedbacks from employees just-in-place, in-time, and
hence assists in solving complex problems at the workplace. As such, a The only constant in a world marked by volatility, uncertainty,
real-time system can help augment the learning process and career/­ complexity, and ambiguity is change. Human resource management
professional development of employees. AI systems can analyze large (HRM) has transformed from performing routine tasks such as recruiting
datasets, both structured and unorganized data, in real-time and and firing to serving as a business strategic partner. Similarly, the
discover the formations and designs. It is used for intelligence-assisted domain of artificial intelligence (AI) has undergone a paradigm shift,
human decision-making (De Laat et al., 2020). AI can assist the man­ transitioning from a simple search tool to the conceptualization and
agers in detecting aberrations by giving real-time comprehension about construction of intelligent robotics. AI has evolved into a collection of
premature caution signs of severe issues and hence allows them to take potent technologies redefining numerous functional areas, including
timely corrective actions accordingly (Jarrahi, 2018). Real-time in­ HRM. AI’s implementation in HRM is regarded as a positive develop­
teractions ensure efficient usage of resources and services provided, ment because it should generate optimum value at minimum expense. AI
thereby reducing costs (Gopal et al., 2018). The latest technologies, focuses on developing tools with discernment and intellect comparable
namely Internet-of-Things, are facilitating physical properties to con­ to humans (Kalia & Mishra, 2023). The modernization of Human
nect to the digital realm, which leads to a vast amount of real-time data Resource Management (HRM) has undergone a significant trans­
(Sivathanu & Pillai, 2018). AI-enabled real-time video interview with formation, with the integration of digitization into the laborious pro­
applicants across countries helps to pool more enormous applicants and cesses inherent in how it functions. Human resource management has
process faster (Thomas et al., 2020). developed strategies to leverage technological advancements such as the

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internet and computers to enhance electronic productivity, cost effi­ satisfied workforce, leading to improved productivity, reduced turn­
ciency, and market competitiveness (Votto et al., 2021). The swift over, and ultimately cost and time savings (Huang et al., 2023; Modgil
development of Human Resource Information Systems (HRIS) was et al., 2022).
ignited by technological advancements, which allowed for the infiltra­ There are some research previous works done to identify the po­
tion of tactical practices within HR operations with contemporary fea­ tential outcome of using AI in Human Resources Management. However,
tures such as artificial intelligence (T-HRIS). As it improves sustainable there is no research done to examine the relationship between the out­
business models, the volume of organizational, personnel, and comes or how each of these outcomes influences the other. Hence, the
task-oriented data for which HR is fundamentally accountable has research gap examining the relationships between outcomes is identi­
prompted the integration of AI into numerous tactical HR processes (G. fied, particularly in selected IT companies in Chennai City, and pre­
M & Suganthi, 2022). sented by Diagram.
Nevertheless, this progression and expansion of functionalities en­
tails comprehending the present condition of artificial intelligence (AI) H1: There is an impact of Accuracy on Time Saving and Cost
in tactical HR procedures. This necessitates HR experts and scholars to Reduction in selected IT companies.
delve into extant literature that elucidates AI-augmented HR capabilities H2: There is an impact of Automation on Time Saving and Cost
and domains for development within the HR field. (Rodgers et al., 2023) Reduction in selected IT companies.
point out that Artificial intelligence (AI) can generate real-time decisions H3: There is an impact of Computing Power & Capacity on Time
by utilizing pre-installed algorithms and computing technologies Saving and Cost Reduction in selected IT companies.
developed through data analysis. These components autonomously H4: There is an impact of Real-Time Experience on Time Saving and
learn and adapt to provide more sophisticated responses to circum­ Cost Reduction in selected IT companies.
stances. Human resource management (HRM), which incorporates the H 5: There is an impact of Personalization on Time Saving and Cost
utilization of AI applications and the human element, has the potential Reduction in selected IT companies in Chennai city.
to enhance the employee experience within an organization. It is evident
that potential outcomes such as Accuracy, Automation, Computing 4. Methodology
Power and capacity, Real-Time Experience, and Personalization are
directly or indirectly leading to the very basic outcome of using AI in When it comes to the research design, it is descriptive. The study is
HRM, which is Time Saving and Cost reduction. At this juncture, it is designed to identify the outcomes of using AI in HRM practices and
important to note that AI-powered recruitment tools can accurately examine the relationship among those outcomes. The study is con­
match candidates’ skills and qualifications to job requirements. structed based upon primary data gathered from the respondents, as
AI-enabled HR analytics can process vast amounts of data with accuracy well as secondary data from various resources like reports, research
and provide valuable insights for better decision-making (Malik, article databases like Scopus, Emerald, Elsevier, Google Scholar, online
Budhwar et al., 2022). Leveraging AI Accuracy in HRM process opti­ open-access journals, etc. were also extensively used in this study to get
mizes various HR functions, leading to time and cost savings while relevant and up-to-date information in the selected topic. To analyze the
improving overall efficiency and employee satisfaction (Vrontis et al., potential outcomes of using AI in Human resources management and the
2022). AI-powered automation can streamline repetitive tasks that relationship between those variables, the researchers targeted the em­
would otherwise require human intervention. These tasks can be per­ ployees of selected IT Companies in Chennai City where AI technologies
formed more efficiently and consistenly by AI systems, leading to are used in HRM practices. The opinions of the IT employees are
reduced cost and faster processing time (Burgess & Burgess, 2018; collected through a structured questionnaire, which was designed based
Malik, Thevisuthan et al., 2022). With high computational power, AI on the existing literature. The well-structured questionnaire consisted of
tasks can be executed much faster, enabling quicker results. Increased the personal and organizational details of employees. Secondly, AI
computing power of AI and cloud computing platforms provide variables (potential outcome of using AI in HRM, namely, Accuracy,
on-demand access to vast resources, allowing organizations to leverage Automation, Computing power & Capacity, Real-Time Experience,
AI capabilities without the need to invest heavily in expensive hardware Personalization, and Timesaving & Cost Reduction) in Likert’s five-point
(Gill et al., 2019; Murshed et al., 2021; Sivathanu & Pillai, 2018). AI scale with options ranging from strongly agree to strongly disagree. The
enabled real-time information for decision-making, feedback, alteration researchers followed the convenience sampling method and collected
of course of actions based on progress and responses enables the com­ primary data from approximately 274 IT employees within Chennai
panies to save time and cost effective. AI real-time features can improve City. The online google forms were used to collect data; questionnaire
efficiency, cut operational costs, and enhance overall productivity links were circulated via personal contact and social media platforms
(Achchab & Temsamani, 2021; Rai & Singh, 2023). By utilizing AI like Twitter and LinkedIn from May 2021 to September 2021. Out of all
personalization in HRM, organizations can create a more engaged and the responses received, only 274 were filled completely and correctly,

Diagram. Conceptual framework for hypothesis development.

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considered for further analysis. For analysis part, IBM SPSS version 21 preferred choice for this research as the study seeks a comprehensive
software and AMOS version 21 software are used. understanding of interdependencies among diverse factors. SEM is used
to evaluate the model’s appropriateness based on the samples collected
5. Results (R et al., 2012). To analyze the structural model, AMOS version 16 is
used. The SEM is considered the most helpful tool for evaluating the
Out of 274 respondents, 55.5 % are female, and 44.5 % are male, causal relationship linking variables and verifying the model’s
indicating that female employees are more willing to take the survey and compatibility (Tobbin & Kuwornu, 2011). This integrated methodology
are more interested in the topic area. The results also stated that the allows a holistic exploration of the interconnections between various
majority, 51.5 %, are in the age group between 26 and 30 years, which factors in the context of using AI in HRM.
denotes that comparatively, young people have taken part in the The above table shows that the estimated P-value is 0.051, which is
research survey more enthusiastically. When it comes to educational more significant than 0.05, which denotes that model is fit. Gerbing and
qualification, it is categorized into undergraduates, postgraduates, and Anderson suggest the criteria for an acceptable model were RMSEA of
Professionals. It is found that 39.1 % of respondents possess a profes­ 0.08 or lower; CFI of 0.90 or higher; and NFI of 0.90 or higher (Gerbing&
sional degree, followed by Postgraduates with 35.4 %. The data are Anderson, 1992). According to Hu and Bentler, the fit between the
collected from IT employees from different designations and levels proposed measurement model and data can be verified with a chi-square
starting from low to top-level of the management. It is inferred that the goodness-to-fit test, and when the probability value is greater or equal to
majority of the respondents are software engineers with 30.3 %. The 0.9, which indicates a good model fit (Hu & Bentler, 1999). The GFI of
results also indicate that 81.4 % of the respondents belong to the mar­ this research was 0.922, which is more than the recommended value,
ried category, and only 18.6 % are single/unmarried. The monthly in­ and the Adjusted Goodness of Fit Index value (0.902) is greater than the
come of respondents, the majority, 44.2 %, of the respondent’s monthly recommended value of 0.9, which also represents it is a good fit. The
income, is between Rs 25,001–Rs 50,000 and, and 26.3 % of the re­ calculated Comparative Fit Index value (0.987) shows that it is a perfect
spondent’s monthly income is between Rs 50,001–Rs 75,000. It is found fit, and also, it is found that the Root Mean Square Error of Approxi­
that respondents with 2–5 years’ experience have taken part in the mation value is 0.023, which is less than 0.08 which indicated it the
survey maximum with 37.6 %, followed by 6–10 years’ experience with model fitted satisfactorily shown in Table 2.
32.1 % shown in the Table 1.
5.2. Measurement model
5.1. Structural equation modeling
As recommended by Anderson and Gerbing (1988), we first exam­
ined the measurement model and presented the CFA results in Table 3.
In the realm of sophisticated data analysis, SEM method is particu­
The below table shows the confirmatory factor analysis results. The
larly favored over traditional statistical techniques as it facilitates the
confirmatory test result showed a good fit as well. The below table shows
examination of both observed and latent variables, allowing the re­
the model fit summary of the research model.
searchers to unravel intricate causal relationships among various con­
The results reveal that the model fits the data well (χ2 = 383.133; df=
structs. SEM’s capacity to account for measurement errors and its
260; χ2 /df =1.474; Root mean square error of approximation
capability to handle multiple variables simultaneously make it a
(RMSEA)=0.042; Comparative Fit Index (CFI) =0.97; SRMR=0.071 &
Pclose=0.944 provided a good fit of the model to the data (MacCallum
Table 1
and Browne, 1993). The results indicates that the CFA model of adoption
Personal characteristics of employees.
of AI in Human resource management variables is fit.
Personal Characteristics Frequency (n = 274) % In this research, for all the variables, the square root of AVE exceeds
Gender the correlations between variables, thus providing support for discrim­
Male 122 44.5 inant validity of all the variables (Fornell and Larcker, 1981). The square
Female 152 55.5
root of AVEs for Accuracy 0.703; Automation=0.730; Computing power
Age (Years)
22–25 yrs 42 15.3 and Capacity =0.695; Real Time Experience=0.593; Personalization
26–30 yrs 141 51.5 0.513; Time saving & Cost Reduction =0.538 and the composite reli­
31–40 yrs 85 31.0 ability (CR) for all the variables exceeded 0.70 (ranging between 0.800
Above 40 yrs 6 2.2 and 0.915). The average variance extracted (AVE) was found between
Marital Status
0.513 and 0.730, over the minimum acceptable level of 0.50 shown in
Single 51 18.6
Married 223 81.4 the Table 3, Table 4 and Table 5.
Qualification
UG. 70 25.5 5.2.1. Hypothesis results
PG 97 35.4
The above table shows that the p values for the constructs namely
Professional 107 39.1
Income -Monthly
Accuracy, Automation, and Real-Time experience are less than 0.001,
< Rs 25,000 54 19.7 significant at the 1 % level. Hence hypothesis H1: There is an influence
Rs 25,001–Rs 50,000 121 44.2 of Accuracy on Time Saving and Cost Reduction in selected IT com­
Rs 50,001–Rs 75,000 72 26.3 panies, H2: There is an impact of Automation on Time Saving and Cost
> Rs 75,000 27 9.9
Reduction in selected IT companies and H4: There is an impact of Real-
Designation
Administrator 33 12.0 Time Experience on Time Saving and Cost Reduction in selected IT
Business and Program Analyst 43 15.7 companies are supported by the study findings. Regarding the variables
software engineer 83 30.3 Computing power & Capacity, and Personalization the P values are not
Project and HR Manager 43 15.7
Managing Director 10 3.6
Others 62 22.6 Table 2
< 2 years 27 9.9 Model fit summary of the structural equation model.
2–5 years 103 37.6
Parameter CMIN P CMIN/ GFI AGFI CFI RMSEA
6–10 years 88 32.1
DF
11–15 years 38 13.9
Above15 years 18 6.6 Outcome 296.13 .051 1.148 0.922 0.902 0.987 0.023

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Table 3 precision in prediction and analysis, HR processes such as workforce

Showing the measurement model fit summary of AI adoption in HRM model. planning and decision-making can be streamlined, contributing to
Measure Estimate Threshold Interpretation overall efficiency.
The study does support the second hypothesis, suggesting that
CMIN 383.133 – –
DF 260 – – Automation (Causal variable) has significant impact on HRM Practices
CMIN/DF 1.474 Between 1 and 3 Excellent in the selected IT companies. There are several other studies which are
CFI 0.97 >0.95 Excellent assertive that the AI Automation process does lead to Time Saving &
SRMR 0.071 <0.08 Excellent Cost Reduction, this study finding is in perfect line with those findings.
RMSEA 0.042 Excellent
This finding totally support the common belief that AI automation
<0.06
PClose 0.944 >0.05 Excellent
inevitably leads to time-saving and cost reduction. Integrating AI in
HRM processes yields substantial time-saving and cost-reduction bene­
significant and hence the hypothesis is not supported. fits. By automating repetitive tasks such as candidate screening,
onboarding, and payroll administration, AI optimizes operational effi­
5.2.2. Confirmatory factor analysis ciency, allowing HR professionals to allocate their time to more strategic
Relationship among Potential outcomes of using AI in HRM practices endeavors (Hmoud & Laszlo, 2019). AI-powered analytics enhance
(Accuracy, Automation, Computing Power & Capacity, Real-Time decision-making, enabling proactive measures to minimize employee
Experience, Personalization, Time Saving & Cost Reduction) in turnover and associated costs (Sahota & Ashley, 2019). Ultimately, the
selected IT Companies in Chennai City shown in the Fig. 1 and Fig. 2. study suggests that AI-driven automation in HRM significantly expedites
processes and lowers costs, facilitating a more agile and
6. Discussions resource-efficient workforce management (Johnson et al., 2020).
However, in contrary to the above finding, the third hypothesis is not
6.1. Discussions on the adoption of AI in HRM practices supported by the study results, suggesting that Computing Power &
Capacity (Efficiency) of AI technologies has no impact Time-saving and
The novel theoretical contribution of this research is that we have Cost Reduction outcomes in the selected IT companies in Chennai City.
identified the various potential outcomes of using AI technologies across While many other studies are optimistic about increased computing
human resource management practices (Accuracy, Automation, power & capacity of using AI in HRM, this study finding is not syn­
Computing Power & Capacity, Real-Time Experience, and Personaliza­ chronizing with those findings. The current study findings does not
tion). Moreover, the research has developed and contributed an inte­ support that with increased computing power, capacity, and advanced
grated model revealing relationship among whether Accuracy, memory, AI technologies can take control; even decisions are taken
Automation, Computing Power & Capacity, Real-Time Experience, and routinely by software systems, resulting in time-saving and Cost
Personalization cause Time Saving and Cost Reduction in the selected IT reduction (Braun et al., 2016) in human resources management func­
companies in Chennai City. The theoretical findings of this study shed tions (Duan et al., 2019).
light on the impact of various causal variables related to AI adoption in The study highlights inadequate computing resources in the IT
Human Resources Management(HRM) on the outcome variable of Time- companies can hinder AI systems from processing data swiftly and
saving & Cost reduction. According to the study results, the following accurately, potentially leading to prolonged decision-making processes
discussion was carious out. AD reduced operational efficiency. Insufficient capacity might limit AI’s
The study supports the first hypothesis, indicating that accuracy, as a ability to handle complex tasks, resulting in missed opportunities for
potential outcome of using AI technologies in Human resources man­ automating labor-intensive processes and optimizing resource alloca­
agement, leads to significant Time Saving & Cost Reduction benefits to tion. Such limitations could curtail the anticipated benefits of AI inte­
the organization. The study findings suggest that avoiding human errors gration, including minimized costs and time saving.
and being precise in prediction and analysis would help organizations Regarding the fourth hypothesis, the study results support the direct
save time and cost in workforce planning and decision-making. AI is impact of real-time experience on the outcome variable, Time-saving &
simply an intelligent machine that works and tries to react like humans, Cost Reduction in the selected IT companies. The current study results
and its primary goal is to perform tasks done by humans with incredible support that the implementation of AI can increase employee experience
speed and accuracy (Sugawara & Nikaido, 2014). By leveraging AI’s and engagement towards the organization, which can reduce employee

Table 4
Results of validity measures.
CR AVE MSV MaxR(H) A AUT CP RTE P TSCR

A 0.904 0.703 0.399 0.908 0.838

AUT 0.915 0.730 0.256 0.917 0.506*** 0.854
CP 0.899 0.695 0.276 0.933 0.526*** 0.198** 0.834
RTE 0.851 0.593 0.187 0.889 0.416*** 0.256*** 0.161* 0.77
p 0.800 0.513 0.187 0.842 0.428*** 0.239*** 0.251*** 0.433*** 0.717
TSCR 0.851 0.538 0.399 0.871 0.631*** 0.465*** 0.345*** 0.342*** 0.264*** 0.733

Table 5
Model regression weights (variables in SEM analysis).
Estimate SE. CR. P Label

TSCR <— A 0.422 0.06 7.042 <0.001** H1-Supported

TSCR <— AUT 0.194 0.05 3.887 <0.001** H2- Supported
TSCR <— CPC 0.049 0.035 1.393 0.164 H3-Not supported
TSCR <— RTE 0.09 0.044 2.057 0.04** H4- supported
TSCR <— P − 0.025 0.058 − 0.425 0.671 H5-Not supported

A: Accuracy; AUT: Automation; CPC: Computing power & Capacity; RTE: Real-time experience; P- Personalization; and TSCR: Time Saving and Cost Reduction

6
N. Nawaz et al. International Journal of Information Management Data Insights 4 (2024) 100208

Fig. 1. Confirmatory factor analysis.

Source: Own development

attrition and help the right talents stay (Dahlbom et al., 2020). Real-time 6.2. Managerial implications
capabilities enable AI systems to process data and provide insights
instantaneously, facilitating swift decision-making and timely in­ The managerial implications drawn from this study’s findings offer
terventions (de Laat et al., 2020). Harnessing AI’s real-time potential practical guidance for organizations aiming to adopt AI technologies in
empowers organizations to react promptly to changing circumstances, HRM to achieve time-saving and cost reduction benefits. To maximize
capitalize on immediate insights, and drive tangible reductions in the benefits of AI technologies in HRM, organizations should prioritize
time-related expenses and operational costs. accuracy and precision by investing in AI systems that offer reliable data
Lastly, the fifth hypothesis is not supported by the study results, the analysis and decision making capabilities. The capitalize on time-saving
causal variable personalization has no significant impact on the outcome and cost reduction opportunities, managers should strategically identify
variable, Time saving & Cost Reduction in the selected IT companies. and automate repetitive tasks within HR operations. By reallocating HR
Even though several other studies are assertive that the AI- enabled professionals time from administrative tasks to more strategic initia­
personalization does lead to Time Saving & Cost Reduction, this study tives, organizations can optimize their work force and allocate resources
finding is not in line with those findings. This finding challenges the more effectively, contributing to enhanced operational efficiency and
common belief that AI organizations using AI in HRM, through cost reduction.
personalization, can procure benefits, namely Time Saving and Cost However, it is crucial for organizations to be cautious about the
Reduction overall (Maity, 2019). The finding signifies that even though limitations of computing power & capacity, as revealed by the study.
employees are positive about the outcome personalization and they Managers should evaluate their IT infrastructure’s readiness to support
believe that AI- enabled personalization tools can augment them in their AI implementations. Adequate computing resources are imperative for
work and will lead to Time-saving and cost reduction, however, the AI systems to function optimally and deliver desired efficiency gains.
outcome, personalization, cannot directly cause time-saving & cost Overlooking computing power & capacity limitations may hinder the
Reduction. Instead, this employee engagement process is realization of time-saving and cost reduction benefits, underscoring the
time-consuming. Cost reduction can be expected after some years and importance of aligning technological capabilities with strategic AI
not in the initial stages (Bhatnagar, 2007). implementation. While real-time experience positively influences
Overall, the theoretical results highlight the intricate relationships employee engagement organizations should recognize the potential of
between different causal variables and their effects on the outcome real-time capabilities in enhancing employee engagement and retention.
variables of time-saving and cost reduction in HRM when implementing Additionally, the study’s finding that personalization may not directly
AI technologies. These findings contribute to a deeper understanding of lead to immediate cost reduction underscores the importance of man­
AI’s potential in HRM and provide a foundation for further research in aging expectations. Managers should communicate the longer-term na­
this area. ture of cost-saving benefits associated with AI –enabled personalization,

7
N. Nawaz et al. International Journal of Information Management Data Insights 4 (2024) 100208

Fig. 2. Structural equation modeling.

Source: Own development

ensuring the stakeholders understand the anticipated timeline for real­ experience, and personalization only on the outcome variable of Time
izing the financial advantages of such initiatives. Overall, by aligning AI Saving & Cost Reduction. This research can continue by focusing on
strategies with these insights, organizations can effectively harness the other possible results of utilizing AI in HRM practices such as unbiased,
potential of AI in HRM, achieving significant time-saving and cost data-driven, competitive advantage, etc. The present study concentrated
reduction outcomes while optimizing their workforce management on Chennai-based IT organizations having 274 samples from amongst
practices. the HR professionals. This research can continue more sample sizes from
other metropolitan cities like Bangalore, Hyderabad, and Delhi. Since
this research is confined only to the information technology sector, the
6.3. Limitations & further research directions study’s findings may not apply to other sectors like Healthcare, Tourism,
etc. Moreover, future research can also be focused on the challenges of
The study confirmed the influence of AI technologies (causal vari­ implementing AI in human resources management practices. An analysis
ables): Accuracy, Automation, Computing Power & Capacity, Real-time

8
N. Nawaz et al. International Journal of Information Management Data Insights 4 (2024) 100208

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