AI and the Future of Human Resources

Presented by IBM

The workforce is the backbone of any organization, and for the Internal Revenue Service (IRS), artificial intelligence (AI) is transforming how the agency manages its human resources. Traci DiMartini, Chief Human Capital Officer at the IRS, and Mike Chon, Vice President and Partner for Talent Transformation at IBM Consulting, discussed how AI is reshaping workforce management and enhancing employee experiences.

DiMartini begins by highlighting the dual tracks the IRS is pursuing in its human resources strategy. On one hand, the agency is leveraging AI to streamline internal HR processes, such as recruitment, onboarding, and talent management. On the other, it is focused on hiring the talent needed to operate and optimize AI tools. This dual approach ensures that the IRS is not only prepared for the present but also positioned for the future.

One of the most notable successes at the IRS has been the use of AI-driven chatbots to improve service delivery. In 2024, these chatbots enabled the IRS to answer 150% more taxpayer questions compared to previous years. The scalability of this technology demonstrates its potential to revolutionize both external and internal operations.

Chon adds that IBM’s AI tools have transformed how organizations approach workforce management. For example, IBM’s "Ask HR" chatbot has achieved a 94% resolution rate for employee inquiries, reducing the workload on HR teams and improving employee satisfaction. By automating routine tasks, these tools allow HR professionals to focus on strategic initiatives, such as workforce planning and talent development.

Retention is another critical area where AI is making an impact. DiMartini notes that the IRS is using AI to analyze workforce trends, identify potential retention risks, and implement proactive solutions. These insights are essential for maintaining a stable and motivated workforce, particularly in a competitive job market.

Chon emphasizes that AI’s role in HR goes beyond automation. “AI is about enhancing the employee experience,” he says. By providing personalized support and resources, AI tools help create a more engaged and productive workforce. This, in turn, benefits the organization as a whole.

The partnership between the IRS and IBM highlights the potential of AI to transform workforce management in the public sector. IBM’s expertise in talent transformation has enabled the IRS to implement cutting-edge solutions that improve both employee and taxpayer experiences. This collaboration serves as a model for other agencies looking to modernize their HR practices.

As AI continues to evolve, its impact on workforce management will only grow. For the IRS, this means creating a workforce that is not only equipped to meet today’s challenges but also ready to embrace the opportunities of tomorrow. By leveraging AI, the IRS is ensuring that it remains a leader in innovation, both in its operations and in its approach to human resources.

This interviews was part of the program AI for Agencies: Modernization and Taxpayer Service which explores the transformative role of artificial intelligence within federal agencies, with a focus on the IRS's efforts to modernize operations, enhance taxpayer experiences, and optimize workforce management. Hosted by Francis Rose and presented by IBM, the program features in-depth discussions with leaders from the IRS and IBM on AI’s strategic implementation, from use-case-driven approaches to its impact on application modernization and human resource management.