Artificial intelligence (AI) comes in many forms and has entered the overall system of organisations including in human resource (HR), where AI started to replace some of the human functions. Nonetheless, despite increased academic interest, research on AI-based HR tools is limited and fragmented. This article discusses the challenges and opportunities brought together during AI intervention in innovating HR functions. This study systematically reviews the existing literature, highlighting key areas where AI is being integrated, such as recruitment, employee engagement, training and development, and performance assessment. With the integration of AI, it successfully helps the industry to work in more effective and efficient ways through enhancing employee learning experiences, mitigating human biases, reducing manpower and training cost, and increasing employee engagement and retention. On the other hand, there are also studies that have raised the concern of the challenges during the AI integration, such as high implementation cost of technology tools, uncertainty and employee resistance, lack of human touch and legal and ethical concerns. This paper argues that successful integration of AI in HR functions requires a holistic approach. Collaboration between HR professionals and AI experts is crucial to address technical and ethical challenges. To leverage AI, organisations must embrace change management strategies to facilitate a smooth transition and foster a culture of continuous improvement. This study sheds light on how AI is transforming HR functions and establishes the groundwork for future research such as competency development, workplace learning, and organisation development, enabling practitioners and scholars to navigate the intricate terrain of AI integration in HR successfully.
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