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How Professional Employer Organizations (PEOs) Leverage Data and AI to Help Businesses Thrive

Calling HR teams overburdened would be an underestimate.

Human resources teams bear the weight of employee wellbeing and organizational success on their shoulders, often in an environment of intense regulatory scrutiny. Traditionally, human supervisors have done all the legwork themselves, which isn't easy or always efficient. However, recent years have seen the “steady hand” more and more become that of artificial intelligence (AI).

Professional Employer Organizations (PEOs) provide wide-ranging HR solutions to companies. Advancements in AI can now enable PEOs to truly harness the power of data like never before. Below, we’ve recapped 5 ways data and AI will improve PEOs in the future.

A Brief Overview of PEOs

PEOs essentially help businesses offload certain labor-intensive tasks by becoming an employer of record on their behalf. This means the PEO oversees things such as talent acquisition, payroll, benefits administration, risk management, and compliance adherence. These are substantial responsibilities the PEO takes on, which in turn, helps to free up the company’s resources by allowing them to outsource many of their most time-consuming and laborious operations.

Learn more about leveraging a PEO for greater buying power.

How PEOs Use Modern Technology Tools and AI to Identify Insights

A PEO will regularly use modern technology to streamline tasks, including powerful data analysis systems and AI. Rather than limiting themselves to HR platforms and cumbersome utilities, they often wield the latest tools in data processing and information technology.

Data is the common denominator in all the work that a PEO does for a company. Companies can and must mine the knowledge they accumulate about their employees and working preferences to find actionable insights. A PEO that integrates these insights into its own collaborative operations can truly bring a company’s work to fruition by helping employers identify trends they would otherwise overlook.

For example, if hiring peaks or decreases at certain times of the year — or if employee satisfaction surveys yield better results when the company offers a certain benefits package — a PEO can use that data to highlight employee trends/needs. PEOs take a holistic approach to data management and optimization, beginning with tracking and ending with personalized actionable recommendations. The amount of time and effort this kind of diligence can save is unparalleled.

PEOs and the Ongoing AI Revolution

The continued integration of AI in business can provide a monumental leap forward. Historically speaking, many of the tasks discussed above require a careful human eye — someone who could constantly monitor progress and make recommendations accordingly. AI sharply diminishes the need for this level of attentiveness, freeing up time for other aspects of the company’s operations.

In other words, machines can now use artificial thought processes to find useful patterns, foresee upcoming changes, and make data-driven recommendations. And while many employers are deliberating how to advise their employees to use AI at work, there is no denying the ability for AI to autonomously discern and analyze massive amounts of data that would be impossible for a human to sift through in a single lifetime.

Modern PEOs are leveraging AI to take their data farther than ever before by:

  • Automating common administrative functions, especially in terms of payroll and employee time-tracking.
  • Forecasting employee retention models over the months ahead. This can help organizations accurately increase or decrease their staffing levels as circumstances require. Guessing is no longer necessary.
  • Enhancing the efficiency of the entire recruitment process. PEOs and HR teams can now devote their time to fostering good relationships with incoming employees.
  • Using advanced machine learning algorithms to find the links between employee turnover, benefits packages, workload, and other drivers of organizational success.

All of this was possible before, but it was not possible to do it at a swift and monumental scale as AI solutions offer. Rather than fundamentally altering the methods of employee and performance management, AI accelerates these methods to a whole new level. The same methods become faster, more efficient, more accurate, and easier to plan around.

PEOs and AI: Your Businesses’ Competitive Edge

For years, HR teams have been torn between reacting to day-to-day workforce needs and proactively planning to support their organization’s future. Historically, there was simply too much data to work through effectively and not enough resources. Now, data gathering and processing happens at the speed of a computer’s calculations. With the fast pace of modern AI technology only ramping up, PEOs provide strategic guidance and mold emerging technologies to meet their client’s needs like a well-fitting glove.

Learn more about how a PEO can help power your business success.