Innovation and AI in HR Management at Marks and Spencer

This article discusses how Marks and Spencer has used AI to solve HR management challenges and drive innovation. It explores the link between innovation and business success, and the potential future of AI in HR. The article also examines how daily human relationships may change with the adoption of AI.

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IMBA International Masters in Business
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Successful Innovation & Change (SIC)
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Successful
Innovation &
Change (SIC)

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1. How problems faced in human resource management has been solved using AI?.................3
2. Coynes 3-Condition.................................................................................................................5
3. How innovation is linked to business success, what can be the future based on AI and how
the daily existence of human relationships change?....................................................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Innovation means turning an idea into solution that adds value over the existing system
from the customer's perspective. Successful innovation is defined at the company level based on
the productivity, profitability, market share, growth opportunity, competitive advantage etc.
Innovation and change are connected as innovation is change or it requires change. It is
something different to every individual. Innovation means different to every organization and to
be successful it is important to define what vision, strategy and goals are going to be for
innovation. The most interesting part in innovation is robotics and artificial intelligence. In this
report, Marks and Spencer is taken as the organization. It is a well-known multinational retailer
in UK that specializes in selling high quality clothing, food products and home products with
over 1380 stores around the world. This report states about the innovative solution from
technology used by Marks and Spencer to tackle business challenges, how much it is successful
in terms of innovation and capabilities and what are the new developments or creative ideas to
face the future, 10 years ahead based on Artificial Intelligence.
MAIN BODY
1. How problems faced in human resource management has been solved using AI?
There has been an increase in technological advancement in the field of HR, through
machine learning one can expect recruitment and employee management system to be smarter
which will be easy to understand, accessible which will solve major pain areas of HR managers.
Three existing solution that has been implemented by Marks and Spencer are described below.
1. Human Resource Information System(HRIS): It is an integrated system used to gather,
store and analyse information regarding the organizations human resource. It can help
HR automate and simplify task, reduce administration and record keeping and provide
other HR related information (Agrawal, 2015). It has different components such as
recruitment, time and attendance, training and development, performance evaluation,
labour relations, payroll interface etc. AI system helps HRIS by making recruitment and
record management process automatic and systematic. It lowers the time spent by HR
professional in repetitive and unproductive administrative tasks. Another important role
which AI can play in HRIS system is that through automatic systems HR decisions can
be taken without any bias and it becomes very easy for the organisation and its HR
system to measure the return on investment and effectiveness of HR decisions. It has

been possible with AI which M&S has already implemented. M&S has started recruiting
through online, candidates can take an online test and upload the resume. M&S has
successfully implemented this system which has helped in conducting development
program and online training from different location and maintaining performance record
of the employees centrally. So it can be said that information system has brought
efficiency in HR process of M&S.
2. Decision Support System(DSS): It is technology that assists in managerial decision-
making by helping decision makers to take timely and accurate decisions by using the
unstructured data and models available (Aouadni and Rebai, 2017). M&S has
implemented this system for better decision-making. Machine learning is being used for
anomaly detection, employee attribution, more personalized employee experience using
predictive analytics to recommend career path, professional development (Madhavi
Lakshmi and Siva Pratap, 2016). It helps in setting rewards for the employees based on
the performance and data analysis of each employee.
3. Management Information System: It is an information system that provides
information to all levels of management for running the business smoothly (Taamneh,
Alsaad and Elrehail, 2018). It is designed to provide primary and exceptional reports for
structured problems. It helps in planning, organizing, directing and controlling. M&S has
an up to date information system which is efficient in dealing with the orders, vendors,
inventory management, performance improvement etc. (Wiblen and Marler, 2019). AI
with automation is implemented across all repetitive manual task to boost efficiency,
productivity and drive innovation.\
Model has been used to explained importance of three solutions for growth and expansion
of firm and enhancing profitability.
Tidd & Bessant 4P's model of innovation space
This tools helps to discover what innovation process can improve and bring to the
business. The innovation mix consists of 4 P's which are stated below.
1. Product: It refers to the products and services that the organization offers. At present
M&S sells vast range of consumer goods such as clothes, food and other household
items. However, there is great potential for organisation to innovate its range of products
and services. For instance, new diet food for health-conscious products or mobile

application-based booking system can be effective innovation in products and service
range of M&S. Thus, the Decision Support System (DSS) can be put into this P as it will
help in taking managerial decision with the help of unstructured data.
2. Process: It refers to the changes in the way things are created and delivered. In this,
HRIS can be plotted because it is the collection of different functions that can be carried
out based on the needs such as training and development, performance evaluation, payroll
interface etc. At present most of the services are delivered by M&S through its physical
stores. However, organisation has made attempts through online retailing but its
effectiveness can be increased by improving its process of service delivery. For instance,
organisation can provide mobile application-based services or AI based billing counters
in its stores so that operational process can be accomplished quickly. It will enhance the
quality and customer satisfaction. Here, HRIS system can be put to use which will help in
managing the all the information of the customers.
3. Position: It refers to the changes in context to product and services created (KOUKIS
and KOULIOUMPAS, 2015). DSS can be taken in this because all the decisions are
taken based on this system and relevant changes are undertaken in the product and
services of M&S and employee’s performance analysis and retention decisions. In this
HRIS system is best as it will help in monitoring the performance of the employees and
in undertaking important changes.
4. Paradigm: It refers to the change in the model under company frames what it does. So,
MIS can be put into this as its main purpose is to help M&S from planning to controlling
that is from starting till end, which completely changes the way organization works. It
will give broad platform to organisation for interacting with its customers and other
stakeholders so that organisation can make better decisions. Therefore, MIS solution will
be used because it will assist M&S in all the stages of change with a chance to interact
with the stakeholders.

Figure 1: The 4 P of Innovation
(Source: Tidd & Bessant 4P’s Model of Innovation Space, 2013)
2. Coynes 3-Condition
On the basis of Coynes 3-Conditions the 3 solution can be evaluated as follows:
Human resource information system is an intersection through HR software between human
resource and information technology (Williams, 2015.). This system can be used in M&S to
undertake various small activities such as management of human resource, accounting, pay roll
and plan HR cost effectively. In order to gain competitive advantage HR should find new way to
manage different type of people with different perspective, should identify the capability of its
competitor or the way they are managing human resource. This system assists in creating value
chain, trust and reputation and the way M&S manage to the changes. It contains information
related to value attribute of employees of M&S that include interpersonal skill, ability to learn
new things, ability to work in team and to adapt to change.
Decision Support System it comprises massive analysis information that can be used to solve a
problem and thus help in decision-making (Faktorová and et.al., 2019). It supports
determination, judgement and course of action in a business activity of M&S. It is either
powered by human or completely computerized. Mapping attribute gives competitive advantage

in the way human resource are organised in the M&S as per their capabilities. By using such
system, it can determine its organization structure and arrangement of people. On the basis of
previous endeavour, it can determine its positional capabilities such formal and informal
operating system, its roles and responsibility and inter relation between various employee. On
the basis of Functional capabilities such as operational, finance and marketing company can
assign work to an individual. On the basis of culture capabilities such as their ability to work as a
team, its ability to manage change, to be innovative and their preferences.
Management system information provide help manager to efficiently manage, organize and
evaluate various department in an organization (Dumoulin and et.al., 2017). It helps in
management of project and people, in decision-making by providing relevant information relate
to past, present and thus predict future. Sustaining, protection and exploiting competencies it is
related to the protection of employees of M&S that include safety and security needs of
employee, employee protection act has been implemented or not. Sustainability include issue
such as cost of employee, is that employee useful, for how many years the employee will remain
in the company. Enhancement include providing continuous training and development of
employee to increases their efficiency. Thus enhances employee efficiency within M&S whcih
will increase the production and profit of the company. Exploitation is to make optimum
utilisation of employee knowledge and skill and it could be used in other way in order to achieve
organisational objective.
The above 3 solutions are important for the company has be explained explained through
Competency tree or wheel. These are describing below:
Human resource management information: It is a useful system for the HR as it provides
information related to payroll, manage account and human resource thus reducing the
work load of HR and help him to focus on main activities of the business. It also decided
the pay roll of HR and thus help in deciding the payroll to the employee as per their
position in the company (Stith-Williams, 2016). So it is value able for M&S as it helps in
managing the most important resource of company.
Decision support system: It helps M&S in assigning right person at right job by providing
information related to organisation structure and as per the skill and knowledge of the
person thus help in decision-making. Thus, it is useful for M&S as it analysis massive data,

comply that can be used to male decision and solve various problem (Stith-Williams, 2016).
It helps in providing total employee in the organization, the number of employee are to be
recruited, new employee, information related to their efficiency so that decision can be
taken in such matters in order to achieve goals.
Management system information: It important for M&S as it evaluate past, present and
future information and thereby help to evaluate the project or various department
(Shapiro. and Noe, 2015). On the basis of evaluation done it provides training and develop
to employee, utilize its potential to optimum, satisfy him by providing safety and security
thus it helps in achievement of goals of an organization. Thus, it increases efficiency of
employee thereby production and profit of company increases. It not only manages people
but also enable various department to work efficiently within a company. It is important
for a business as it maintain records of various analysed problem and the way they are
solved, so they can be used as per the requirements.

Figure 2 Competency wheel
(Source: COMPETENCY WHEEL, 2020)

3. How innovation is linked to business success, what can be the future based on AI and how the
daily existence of human relationships changes?
Successful innovation needs to be the part of every organization. For business, it means
implementing new and innovative ideas, improving services and creating dynamic products.
Performance based on innovation is a key driver of business success. Supporting HR and IT so
that they can provide training to the employees that contribute to the culture of internal
innovation. For achieving success, innovation has a key role to play (Goffin and Mitchell, 2016).
First, solves problems easily, sometimes coming up with out of the box answer to solve the
problem with which no one has ever come up will make the business better. Second, increase the
productivity, getting stuck at something means it's time to be more productive. In order to work
smarter, think creatively. Focus on the things that can be streamlined or cut out. Also, focus on
the workflows that can be used to increase productivity. Third, beat the competitors, innovative
thinking can easily come up with better ways to design products and connect with customers.
Creativity will help checking out the right marketing tactic that will help in growing the business.
Forth, improves employee’s relation, having pride in the product and the desire for the
organization to be at top will reduce workplace turnover and boost productivity which will lead
to more innovative idea because employees are the best source of ideas. Fifth, reduce waste and
cost, innovation can help reduce waste, that can bring number of benefits, lower cost, better
profit margins, increased competitiveness. So it is clear that innovation leads to business success
which requires encouragement and proper funding.
The influence of AI is expanding to a greater extent. In the coming decade, most of the
HR solution will be highly automated and employers would be investing in recruiting and
retaining the best which leads to customized offerings. For example, there are situations when
employees as well as customers of M&S may require cognitive support and assistance in
decision making. Thus as part of innovation organisation can use AI so that individual can seek
their help instead of searching for any other employees. One of the major challenge that can be
resolved using artificial intelligence is repetitive task and administrative work, making
employees to focus on more creative and meaningful work (Elliott, 2019). This will give humans
time to do more complex problem solving, critical thinking and creativity. AI can not only help
in removing time-consuming tasks associated with planning, acquisition and management but
also by providing consistent processes and strategies on the ground level. It can concentrate on

analysis and prediction while focusing on employee's needs and outcomes. Employees can
concentrate on the other important task like budgeting, forecasting, formulating employee
policies, predictive analysis, research, identifying the required talent and putting in place.
Analysing the changes in the environment, planning for the same, meeting up with the time is the
major advantage it can have. By using analytical predictions of AI M&S can improve the
customer experience and its profit margin. For instance, if any customer has any queries or issues
then AI or new innovated mobile application system of organisation can even provide
organisational services at odd hours of the day or during holidays.
This transition point from humans to AI or a partnership between humans and artificial
intelligence, AI will not only challenge the communication relationship with humans but also
human communication in general. There are many predictions about unemployment in the next
decade. Task that are monotonous can be easily automated for instance, customer care, call
centre, document verification etc. the same applies to the roles related to operations and
production support, humans are being replaced by robots for smooth navigations and performing
complex assembling operations. Every sector will be impacted by the use of artificial intelligence
(Kamar, 2016). In transportation, already in transformation stage, seeing he decreasing demand
of the skills. In e-commerce sector, fulfilment centres will be fully automated with robots who
will be collecting and executing customer orders and even deliver it to the customer. Importance
of sales person will shrink. Even in legal and financial sector, AI will take the task of
documentation, verification, typing, extraction. Apart from the negative impact it has there are
positive impact as well. It will increase the productivity of the organization through its quick
process, with more accuracy which will help in time saving and achieve target. Some jobs will be
lost but new jobs will also be created in the role of support and maintenance of AI and robotics
devices. But it will also require professional having understanding about the AI and robotics. To
cope up with the shift in demand, new skills needed to be acquired because organization have
started the research for professionals having the competent skills (Felten, Raj and Seamans,
2018). Artificial intelligence can collect information quickly and understand the patterns that
humans cannot. It can increase the productivity by giving companies the prediction about the
future opportunities and gives recommendation on how to take action. Companies are using
chatbots to answer to the customer needs this enables organizations to spend less money on
customer service employees and spend more on marketing, production, sales etc. This is how

human relations will be affected or change with the emergence of artificial intelligence and
robotics in the workplace which can be beneficial for some and threatening to other.
Future of AI
AI will replace the human needs on every field of business and daily human connection. It
will be so advanced that it will outstrip the requirement of the human skills. It includes the
solving the logical formulas, medical diagnosis and many other activities which requires
decision making. Everything will be so structured and planned that it will reduce the
reliance over the humans. The implication of it would be seen especially in the supply chain
and manufacturing industry, education, customer service and so forth. Everything will be
advanced and a step far thus, reducing the time wastage so that more focus can eb put in
key areas.
For the proposed changes the below model will be applied.
Figure 3The Architecture of Proposed HR Decision System Model (Source: A Decision-Making
Model for Human Resource Management in Organizations using Data Mining and Predictive
Analytics. 2016)
Here predictive HR model is applied which is based upon the people analytics which
can assist the HR department of M&S. This model makes se of raw data which will help in
introducing new strategies resulting in attaining success. This model will help in promoting
high value employees, enhancing the employee engagement and performance level and
making an investment into right type of training and recruiting the right talent. This can
be easily done by following three points stated below:
 Considering the struggling areas

 Designing around the pain points
 Rolling out the changes
CONCLUSION
From the above analysis, it can be concluded that Artificial intelligence and robotics is
the new way of doing business. It has entered each and every sector having pros and cons and to
remain in the market it is important to grab the skills and changes required. It is a very exciting
field as it is full of innovations and creativity. It is for both employees and business. In this way
business can be successful.

REFERENCES
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Cook, L. J., 2017. Using Concept Maps to Monitor Knowledge Structure Changes in a Science
Classroom.
Dumoulin, C. and et.al., 2017. Pelvic floor morphometry: a predictor of success of pelvic floor
muscle training for women with stress and mixed urinary incontinence. International
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Elliott, A., 2019. The culture of AI: Everyday life and the digital revolution. Routledge.
Faktorová, D. and et.al., 2019. Genetic tool development in marine protists: Emerging model
organisms for experimental cell biology. bioRxiv, p.718239.
Felten, E. W., Raj, M. and Seamans, R., 2018, May. A Method to Link Advances in Artificial
Intelligence to Occupational Abilities. In AEA Papers and Proceedings (Vol. 108, pp.
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Kamar, E., 2016. Hybrid workplaces of the future. XRDS: Crossroads, The ACM Magazine for
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KOUKIS, S. and KOULIOUMPAS, I., 2015. Innovation strategies and ambidexterity within flat
organizations: The case study of Alfa Laval.
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Shapiro, D. L. and Noe, A. M., 2015. Risk assessment: Origins, evolution, and implications for
practice. Springer.Shapiro. and Noe, 2015
Stith-Williams, V., 2016. The Significance of Cultural Competence & Culturally Responsive
Practices in the School Setting.
Taamneh, A., Alsaad, A. K. and Elrehail, H., 2018. HRM practices and the multifaceted nature
of organization performance: The mediation effect of organizational citizenship
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