Unlocking Strategic Directions for AI-Powered HR: a Business Value Assessment Framework

Recent advancements in artificial intelligence (AI) have significantly transformed organizations, making its strategic adoption a priority for managers. One of the most affected areas is human resource management (HRM), where AI enhances employee experiences, reduces turnover, and mitigates recruitment biases. As businesses increasingly invest in AIpowered HR solutions, the need for a structured framework to evaluate their business value has become evident. Despite growing research on AI, the study of AI-driven HR remains in its early stages, with no established framework for assessing its business value. This study addresses this gap by developing a comprehensive evaluation framework. Using a qualitative approach, it integrates a literature review with focus group discussions involving five domain experts. The proposed framework consists of three core components: (1) the assessment process (Plan, Do, Review, Act), (2) assessment criteria (Financial, Operational/Functional, User, Social/Ethical), and (3) stakeholder analysis (Internal and External stakeholders). The findings equip HR managers with a structured tool to assess AI implementations, identify strengths and weaknesses, and develop strategic improvement plans. By applying this framework, managers can gain deeper insights into the value of AI-powered HR investments and make more informed decisions.