Gallagher is advising Australian employers to take a structured and transparent approach as artificial intelligence (AI) and generative AI (GenAI) reshape the workplace.
The firm noted that while technology is now central to business operations across industries, many organisations and their employees are not yet positioned to fully leverage the advantages or manage the risks that come with AI adoption.
Digital skills are increasingly necessary for workplace effectiveness, and negative technology experiences can impact employee engagement, productivity, and retention.
The adoption of GenAI, which began accelerating in late 2022, has been faster than previous technology waves such as smartphones.
Despite this rapid uptake, many employers have not yet established clear guidelines or provided training on AI use, and responsibility for AI oversight is often undefined.
GenAI platforms, which generate content in response to user prompts, are being integrated into various business applications, including customer relationship management systems.
Early use cases have shown benefits such as faster product development and improved talent management.
However, Gallagher pointed out that many organisations are not keeping pace with the challenges of AI, including data security and ethical considerations.
Recent research referenced by Gallagher indicated that only 29% of employers worldwide have issued guidance on AI use, and just 20% offer training or resources for staff.
In half of the organisations surveyed, no one is specifically responsible for AI. This lack of direction can lead to uncertainty among employees, who may worry about job security or feel overwhelmed by technological change.
Sarah Beech, CEO of benefits and HR at Gallagher in Canada, recommends that organisations take the initiative in communicating their AI strategy.
“Determine how your organisation will adopt and integrate AI into your business. Then, you tell the story instead of the story being told for you by uninformed and anxious employees. Come out with a clear strategy and communicate it,” she said.
Gallagher highlighted that leadership is critical in setting the direction for AI integration. Leaders are encouraged to treat AI adoption as a strategic priority, starting with a clear statement of intent, selecting secure and effective GenAI platforms, and providing practical guidance for employees.
AI adoption does not follow a simple path, with some organisations moving cautiously and others embracing new tools more rapidly.
Gallagher suggests that leaders focus on managing change and helping employees understand that AI is likely to alter job roles rather than eliminate them. The aim is to combine human expertise with AI to create more value.
Steve Coco, global managing director of HR and compensation consulting at Gallagher, said leaders need to assess their organisation’s readiness for new technology.
“If your business is an early adopter in tools and technology and your people are comfortable using them, change management will be easier. If not, embracing technology and change must be a leadership-driven initiative. Otherwise, you’ll be left behind. It’s that simple,” he said.
Gallagher noted that employers expect nearly half of workers’ skills to be disrupted by 2027, with routine tasks such as data entry and basic customer service likely to decrease.
At the same time, skills related to managing AI systems, creative thinking, and collaboration between humans and AI are expected to become more important.
Gallagher recommends investing in training and development to help employees adapt to these changes.
Focusing on the employee technology experience is seen as a way to create a positive cycle of better tools, higher satisfaction, and improved business outcomes.
Gallagher suggests that investment in AI literacy and change management can support productivity and retention.
Gallagher’s insights come as the Australian insurance sector rapidly adopts GenAI. According to a recent Gallagher Bassett whitepaper, nearly 90% of insurers in Australia now use GenAI in claims operations, up 38 percentage points from the previous year.
A global study commissioned by Arctic Wolf, including respondents from Australia and New Zealand, found that almost half of local leaders identified intellectual property, data privacy, and regulatory compliance as top security concerns.
