Artificial intelligence (AI) is revolutionizing the financial services and insurance (FS&I) industry, an industry that relies heavily on data-driven decision-making, risk management and customer interactions. AI is already enhancing these functions, from powering customer service chatbots to generating algorithms that support fraud detection. And we’re on the cusp of the transformation of the HR function too. Our research found that 72% of senior HR leaders in the industry anticipate that these technologies will significantly affect their roles in the next three to five years.
On the surface, this shift presents an exciting opportunity, streamlining processes, enhancing efficiency and freeing up valuable time. However, the industry operates under some of the most stringent regulatory frameworks including the European Union’s recent Digital Operational Resilience Act (DORA), the General Data Protection Regulation (GDPR) and the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The dual challenge
Such regulations mandate rigorous data protection, robust cybersecurity measures, and the ethical use of AI. HR leaders must therefore battle a critical challenge: balancing innovation with compliance. Striking this balance will be vital to unlocking AI and automation’s full potential, securely and safely.
Our report "From Manual to Meaningful: Unlocking HR's Potential Through Digital and AI Transformation" reveals just how pressing these concerns are. In the next two years, senior HR professionals are equally concerned about keeping up with new HR trends (67%), as they are addressing data security and privacy concerns (67%).
Despite these concerns, organizations are not shying away from AI-driven solutions. In fact, many are already leveraging automation to enhance document management. 60% of FS&I HR departments are using AI-powered tools for document management, leveraging smart functionalities and automated notifications to reduce administrative burdens and focus on more strategic initiatives.
Taking AI and automation to the next level to alleviate workloads
To alleviate mounting pressures, the adoption of AI and automation is becoming increasingly essential for HR professionals in the FS&I sector, who are facing significant workload challenges. Between ensuring compliance and addressing employee concerns related to policy changes (70%) and maintaining a healthy work-life balance (44%), teams are under increasing pressure.
The integration of AI-driven automation is no longer an option but a necessity for HR leaders looking to alleviate this for their teams. By leveraging AI-driven tools, they can improve efficiency, reduce human error and ensure compliance with evolving regulations, allowing them to shift their focus from administrative tasks to strategic initiatives.
And HR leaders recognize this. To address workload challenges, senior HR leaders plan to expand their AI and automation capabilities to:
- Accelerate manual processes - 60% plan to introduce more automation to expedite traditionally manual HR tasks, reducing the time spent on repetitive work
- Fully digitizing documents - 58% aim to eliminate paper-based processes, ensuring that all HR documentation is digitized and easily accessible but also more secure and compliant with evolving regulations
Tailoring solutions for HR
Generic HR tools may not always meet the stringent regulatory requirements of FS&I, making it crucial for HR teams to adopt dedicated solutions tailored for compliance. HR-specific technology can have a far greater impact, with 55% of FS&I senior HR professionals believing that selecting the right HR technology can transform their operations.
As FS&I HR teams navigate the path to AI and digital transformation, they must adopt secure, regulatory-compliant solutions that enhance efficiency while protecting sensitive employee data.
For further information on how aconso can help your organization confidently embrace AI and digital transformation, while meeting compliance needs, contact us at contact@aconso.com.
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