Adoption of AI-Based Technologies and Its Impact on HR Functions: A Study of Selected IT Firms in India

Abstract

The rapid adoption of artificial intelligence (AI) technologies is transforming organizational processes, with human resource (HR) functions emerging as a critical domain of impact. This study investigates the extent to which AI-based technologies influence key HR practices—such as recruitment, onboarding, performance management, learning and development, and employee engagement—within selected IT firms in India. The purpose of this research is to analyze how AI adoption reshapes HR efficiency, decision-making, and employee perceptions of fairness and transparency in technologically driven workplaces.

A mixed-methods approach was employed, combining quantitative survey data from 320 HR professionals and employees with qualitative insights from 25 semi-structured interviews conducted across leading IT firms. Quantitative data were analyzed using partial least squares structural equation modeling (PLS-SEM) to measure AI adoption intensity and HR outcomes, while qualitative data were examined through thematic analysis to capture nuanced perceptions and organizational challenges.

The findings reveal that AI adoption significantly enhances recruitment efficiency, reduces bias in candidate screening, and supports data-driven performance evaluations. However, employees expressed concerns about reduced human touch in HR processes and potential surveillance risks. The results further indicate that firms with higher AI maturity demonstrate stronger alignment between HR analytics and workforce planning.

In terms of practical implementation, the study highlights strategies for balancing technological automation with human-centric HR practices. IT firms can leverage AI to optimize operational processes while concurrently investing in change management, transparency protocols, and employee trust-building initiatives.

The originality of this study lies in its dual methodological design and its focus on the Indian IT sector, which is at the forefront of AI-driven HR transformation. Unlike prior research that primarily addresses either technological efficiency or employee perceptions, this paper integrates both dimensions, offering a holistic perspective on the implications of AI adoption for HR functions in emerging economies.