HR could be a progressive AI adopter

Published in October 2025, the Fosway 9-Grid™ for Talent & People Success looks at the talent management and people experience solutions market for EMEA’s HR leaders – here Fosway analysts compare intent with action when it comes to AI adoption.

2025 saw a wave of innovation. AI has exploded into real-world application and implementation for skills-based organisations. AI applications are also the springboard to strategic workforce intelligence and planning at a level of precision and depth not seen before. The focus on ‘task’, ‘work’ and ‘skills’ is offering the transparency and connectivity to enable workers to start to navigate the future of work.

But it’s not all about skills. Progress in sentiment analysis and the use of chatbots is revolutionising employee listening, employee engagement and performance management. AI coach-bots are transforming leadership development, and AI is using behavioural science to power culture change. The adoption of AI, HR automation and chatbots is second only to ‘being a strategic business partner’ for HR teams in 2026.

But real AI adoption is falteringly slow

Despite highly inflated expectations for AI in HR, vendor roadmaps still rule over delivered reality and customer adoption rates are faltering slow. Less than one in five  companies has any live AI adoption in their talent system, and most HR teams are still in the early stages of planning or piloting.

For skills, less than 15% are using AI today, and in strategic workforce planning that drops to just 7% . Whilst interest is high, the appetite and readiness to embrace AI is more guarded, especially with increased AI governance in organisations. What might have snuck under the radar in the past is less likely to do so today.

AI and skills intelligence are key M&A targets

The Talent & People Success sector continues to experience significant M&A activity. Whilst large HCM providers continue to acquire niche capabilities to address their niche shortcomings, mid-sized vendors are also engaging in strategic acquisitions or forming partnerships to bolster their offerings too.

AI-driven solutions, especially those centred on AI automation, talent acquisition, skills intelligence or strategic workforce planning, are sought after and most common as M&A targets as well as in AI roadmaps.

This is an excerpt from the 2025 Fosway 9-Grid™ for Talent & People Success. Get the full insight and discover all the latest market and solution trends by reading the whole report here.

What should you do next?

• AI is the dominant business story of the 2020s. And our AI research is unique in the market and available now. https://www.fosway.com/fosway-ai-insights-talent-people-success/
• Don’t miss out – build your AI strategy with the Fosway Group analyst team – Europe’s most experienced HR industry analysts. Sign up here

Other recommended reading

• Our latest cycle of research into the lived experience of EMEA’s enterprise HR leaders is now live: HR Realities 2025.
• The 2025 Fosway 9-Grid^TM for Cloud HR – full report. Released earlier this year. All the latest market and solution trends in Cloud HCM – get the full analysis today.

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