Examining the Influence of Artificial Intelligence Implementation in HRM Practices Using T-O-E Model

Abstract

Given the swift progress of artificial intelligence in contemporary economies, HR managers are also adopting artificial intelligence tools to perform many HR tasks, from human resource planning to employee quitting. This research employs the TOE (Technology–Organization–Environment) model and incorporates the trust factor to propose a methodology for investigating artificial intelligence (AI) adoption in HRM. A structured questionnaire was used to survey 615 ITeS companies. Data analysis was performed using partial least squares structural equation modelling. The findings of this research indicate that factors such as cost-effectiveness, relative advantage, organization size, top management support, HR readiness, competitive pressure, vendor support, and the trust of HR managers are considered to have a positive impact on AI adoption in managing human resources. The utilization of AI in HRM has been cumbersome by conflicting results stemming from security and privacy concerns and the complexity of the technology involved. It is also found that factors such as reliability and credibility have a positive effect on the trust of HR managers. This article aims to provide valuable insights to senior executives, HR managers, experts, researchers, AI designers, developers, and marketers by strengthening their understanding of the impact of AI in managing human resources.