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For decades, human resource leaders have talked about the need to shift their focus from having responsibility for compliance to acting as architects of talent strategy. And for decades, the pattern of HR being stuck in age-old roles has persisted.
But there is new pressure to redefine the role. Thanks to artificial intelligence, the gap between what HR currently is and what it could be has never been wider. AI hasn’t created this divergence, but it’s making it impossible to ignore.
Recent conversations I’ve had with dozens of chief HR officers (CHROs) indicate that they are facing a clear fork in the road. One path leads to a weakening of the HR role, with more functions automated (like onboarding and learning) or taken on by other business leaders armed with new tools (like skill-based screening during recruitment). The other path leads to the kind of evolution that elevates the HR role, with HR not just taking the lead in driving organizational transformation and engagement but taking ownership of the ways in which incoming and current employees interact with AI.
The path organizations end up on will depend on whether HR can prove its strategic value before business leaders decide they don’t need it.
Technology’s Mixed Role in HR’s Status
The HR function has become the place where organizations send the people problems that other leaders prefer not to own. Kit Krugman, the senior vice president of people and culture at Foursquare, noted that “the genesis of HR was the genesis of management simultaneously,” born in the post-industrial era, with the view of humans as capital to be optimized — hence the poorly aged term “human resources.” Over time, HR’s mandate expanded to learning, engagement, and culture, but the core programs persisted. That explains the unusual bundle of responsibilities HR teams have accumulated: compliance enforcement and culture building, policy sharing and employee advocacy, benefits management and hiring processes, termination supervision and engagement assessment.
Each wave of HR technology over the past 25 years promised to help tame part of the job. For overall organization, HR information systems automated recordkeeping. In hiring, applicant-tracking systems digitized hiring workflows. In education, learning management systems scaled training delivery.
Having to keep up with all of that made it hard for HR leaders to get ahead and focus on bigger-picture tasks. Eric Severson described walking into a room filled with dozens of binders of performance reviews, meticulously completed, filed, and tracked, when he was head of HR at The Gap more than 10 years ago. The HR team was proud of reaching 98% compliance. But the reviews didn’t answer questions like whether the company was reducing unwanted attrition or whether employees were developing new skills. The metric was completion, not impact, and the entire apparatus of performance management — the forms, the ratings, the calibration sessions, the documentation — seemed to have become its own purpose.
Because HR has historically been treated as a cost center rather than a strategic partner, it’s especially in the crosshairs of AI technologies looking to automate away costly humans and labor-heavy tasks. Artificial intelligence introduces something different from previous technology waves: It automates content creation and analysis, not just transactions. AI systems can now draft job descriptions, screen job applications, analyze compensation data, answer policy questions, and facilitate coaching conversations.
The HR technology market is projected to grow from $40 billion in 2024 to over $82 billion by 2032. Much of that growth will come from tools that can take on work HR professionals currently perform. The question is whether HR will lead its own transformation or have change imposed on it.
How HR Leaders Must Respond
The risk of AI displacing HR is one that people have predicted for years. Now it is no longer hypothetical: Business partners are using AI tools for work HR has traditionally owned.
As HR leaders consider how to lead through this shift, it’s important to note the technology’s limitations. AI cannot determine why high performers are quietly job hunting, why innovation has stalled in a particular team, or how to rebuild trust after a failed reorganization. Addressing such challenges requires an understanding of human motivation and the ability to codesign solutions — capabilities that remain distinctly human. AI can identify patterns of discord in a company faster than any analyst, but redesigning the systems that produce those patterns requires different capabilities.
With that context in mind, here’s how HR professionals can realize the potential to become strategic partners in their organizations as they face the pressure of AI coming for their jobs.
Train for strategic thinking. Specialist HR career paths that reward depth in narrow domains like recruiting, compensation, or compliance often provide limited exposure to strategic thinking until those jobholders attain senior leadership roles. By then, HR practitioners have spent years reinforcing transactional approaches. “What this job requires is the ability to understand organization systems and group dynamics,” Foursquare’s Krugman said. HR hiring has historically prioritized interpersonal warmth over analytical ability, but “getting along with everyone might actually be a challenge in this role,” Krugman said.
Lean in to the right metrics and data. In their 2007 book Beyond HR: The New Science of Human Capital, John W. Boudreau and Peter M. Ramstad argue that HR needs to develop a decision science comparable to what finance built around ROI and marketing built around customer value. The authors documented implementations at Disney, Corning, and other organizations that had connected talent investments to strategic outcomes. Nearly two decades later, Severson, now an executive coach, uses their book to educate future CHROs and told me that such examples remain exceptions rather than standard practice.
As former Levi Strauss & Co. CHRO Tracy Layney put it to me, HR leaders should be held accountable for people outcomes with the same rigor “as you would around financial rigor, around customer rigor, around all your marketing metrics.”
Jettison low-value work. “HR never met a program it didn’t like,” Layney noted. But are all those programs necessary? Samantha Gadd, founder of employee experience consultancy Humankind, told me that she recommends an exercise for HR teams: “Choose a wall and put all the initiatives that everyone’s working on up there, and then ask, ‘If we stopped doing some of these, what would employees actually notice?’” Gadd said that HR practitioners should look to eliminate “activity without outcomes,” such as engagement surveys that generate reports but not action.
Incorporate AI where it makes sense. AI may be able to answer routine inquiries and perform initial screenings of job candidates faster and more consistently than HR professionals. Wharton’s Ethan Mollick has noted that “people are turning to AI all the time as a coach, for help with work,” and he’s written that everyone is in R&D when it comes to the technology. “The source of any real advantage in AI will come from the expertise of their employees, which is needed to unlock the expertise latent in AI,” Mollick said. Could HR leadership spearhead experimentation with generative AI within their companies? Too many HR teams have seen cuts to their workforces and then struggled to keep up with their workloads to acquire the capabilities needed to take that on.
Retain and elevate people-centric tasks. HR leaders should focus on core experiences like learning, from onboarding through C-level leadership, in skills-development programs cocreated with employees. They should build systems of outcomes-based accountability instead of policy processes, and they should position themselves as the leaders who are able to address problems that algorithms cannot resolve, and to create measurable business value.
Two Paths Forward
The HR function, as we’ve known it, will be forced to choose one of two ways forward.
The first path leads to marginalization. In this scenario, AI handles more and more transactions, and line managers are supplemented by AI tools to address routine people questions. HR contracts, becoming a compliance function that handles the emergencies that continually arise. The strategic space HR never fully claimed gets allocated elsewhere.
This is essentially the status quo, turbocharged. It won’t be a surprise to see HR teams in many companies go this route: SHRM research found that only 1 in 8 HR teams operates at a high maturity level, which includes the ability to apply data well and to hold on to the right people, among other criteria. The average score across HR organizations was just 3.85 out of 6.00 on the maturity assessment.
The second path leads to what Krugman called an “internal organizational effectiveness engine,” meaning a function staffed with designers, strategists, and systems thinkers who operate as internal consultants. Their job is to scope out problems, establish useful metrics, run experiments, and iterate based on results. This HR function also uses AI to automate transactional work, but it focuses on aligning directly to business objectives the way that innovation teams do, so that humans can focus on system design.
Humankind’s Gadd framed the choice as a shift from expertise to facilitation — from being “the answer people” to recognizing that “the solutions you seek lie in the population you serve.” It means asking better questions, through direct employee conversations rather than survey instruments. It means designing with employees rather than for them.
The structural traps that have shaped HR — like absorbing all of an organization’s people problems and following career paths that reward specialization over systems thinking — have produced a role that HR leaders need to extract themselves from to evolve.
The proactive stance holds more promise: Lean in to the potential for AI to take on the task of answering policy questions, shaping job descriptions, and compiling insights for performance and career conversations. That should free up more time for the coaching, human-centered design, and organizational-insight work that’s long been neglected as the urgent has crowded out the important.
Change also requires a shift in other leadership roles. Yes, there’s a critical need for HR leaders to learn about and adopt business metrics and to tie design to outcome. But the same is true in reverse: Functional leaders need to take more responsibility for their own teams’ people strategies, performance, and outcomes.
AI will change the HR function regardless of whether HR professionals lead that change. The question is whether these leaders will experience AI as something that happens to them or harness AI to drive their own transformation.
