HR oversight tips for boards in an AI-altered landscape

Our survey shows that maintaining and training staff is critical

Although workforce shortages have subsided a bit in some industries over the past year, Grant Thornton’s recent survey of human resources leaders confirms that board members need to maintain their focus on oversight of staffing issues to keep their organizations trending in the right direction.

The survey of more than 600 HR leaders showed that attracting and retaining talent is by far the top challenge that HR functions are facing. Respondents said employee retention is their top priority for the next year, followed closely by their ability to attract talent.

At the same time, HR departments are focusing on training their workforces to use fast-emerging artificial intelligence tools — while simultaneously incorporating AI into their own operations. HR leaders said that behind employee retention, their co-No. 2 priority for the next 12 months (tied with employee attraction) is training and development.

It’s not difficult to see why. AI presents opportunities for enormous improvements in insights and efficiency across the entire industry spectrum, but it’s emerging and changing so quickly that management, in many cases, is struggling to provide guidance for employees to use AI effectively and safely.

In this environment, boards have the ability to provide a steadying influence while supporting management in its efforts to keep the right people employed — and keep them supplied with the right training — as companies move forward in an ever-changing landscape.

Staffing oversight

HR leaders cited benefits — including healthcare offerings, retirement benefits and time off — as the top reason that employees join their organizations and stay with their organizations, followed by development and training opportunities and diversity, equity, inclusion and belonging initiatives. The importance of benefits underscores the need for board members to ask management what types of benefits their people want, and how the company is meeting those desires. The desired benefits are likely to vary substantially based on industry and other factors. Even within the same company, the back-office staff might have benefit needs that differ substantially from those of workers on the factory floor.

With the potential for so much variation, board members may wish to encourage management to use employee surveys to gauge employee needs and to seek out research showing the benefits that successful peer companies offer their people.

Meanwhile, employees are most commonly leaving organizations because their work/life balance isn’t meeting their needs, as wellbeing remains a significant concern in the workplace for both management and employees. The work/life balance challenges clearly indicate that maintaining mental and physical health remains a problem for many employees. This is an area that demands board attention because the solutions may be complex. Ask management:

• Are the organization’s people overworked?
• Are staffing levels high enough to support organizational goals?
• What do employee engagement metrics say?
• What is being done to promote employee wellness beyond offering an employee assistance program?
• Do employees feel able to speak to their managers about their challenges without fear of reprisal?
• Do employees have the tools they need to perform their jobs effectively and efficiently?

The queries about tools may lead to a discussion of AI. Nine out of 10 respondents to Grant Thornton’s CFO survey for the third quarter of 2024 said their organizations are already using generative AI, or they are developing use cases for the technology, and 54% of CFOs (a six-quarter high) say their boards have taken an active role in understanding generative AI governance. Meanwhile, 77% of HR leaders survey respondents said their organization has an AI strategy in place. This indicates that most companies are taking a responsible approach toward AI — and that approach needs to include training.

Directors need to ask where training fits into the AI strategy, as the tools obviously are most effective when everyone knows precisely how to use them. Grant Thornton’s CFO survey for the third quarter of 2024 shows that although 90% of companies are either using generative AI or exploring potential uses for the technology, just 50% have formal training in place on the use of generative AI.

“They’re spending on technology,” said Joe Ranzau, Grant Thornton Growth Advisory Services Managing Director. “But if they’re expecting people to use it in a wise, efficient manner, they also need to spend appropriately on foundational training for their people so they have a basic understanding of when and how to use AI.” 

A chance to make a difference

Skillful board oversight of HR strategies can provide stability for an organization at a time when the roles and responsibilities of people in the workforce is undergoing a transformative reimagination.

Even as AI adoption changes the way people work, organizations will need to continue acquiring and retaining the right people — all while training employees to make the best use of this technology. This creates an opportunity for a high-performing HR function to make a huge difference in operational results, and boards can help by verifying that HR is helping organizations take advantage of emerging opportunities and managing new risks as they arise.