The next time you’re unhappy with your annual pay raise, you might not be able to blame your boss – you might need to blame a machine. In the ongoing quest to replace human resources functions with artificial intelligence, some companies are championing AI as the better (and less biased) tool to determine who gets a raise and how much.
We previously wrote about how tech giant IBM is using AI to determine who’s a flight risk. The technology doesn’t stop at just advising that an employee may be willing to make a move, however. A report in Fortune this week notes the system can also recommend actions, including a promotion or pay raise.
IBM’s use of AI in the performance review process mirrors many other systems used by companies which analyze employee evaluation data and spit out a recommended salary increases. But the predictive nature of IBM’s platform is what sets it apart.
“At one point, all the data showed that giving a certain group of employees a 10% raise would reduce their ‘flight risk’ by 90%,” Diane Gherson, IBM’s chief human resources officer told Fortune. “Managers who didn’t take that advice had attrition rates on their teams that were twice as high as for those who did.”
Gherson emphasized that AI doesn’t replace the role of managers – but simply gives them additional data to use in making decisions. Managers always have the opportunity to override the system – but they also have a repository of data to consider when they do.
For employees quick to complain about their compensation, the use of AI may provide a welcome middle man. A 2017 Payscale survey found the majority of respondents reported being unhappy with their compensation – even if they were paid above the market rate. Compensation also still generally tops the reasons for employees to consider an outside position.
If you knew it was a machine – and not your boss – determining your annual pay increase, would you be more or less satisfied?