SHRPA 2025 Report: HR Leaders' AI Readiness Gap Revealed

At Asia's largest HR and work tech conference, TechHR India 2025, People Matters unveiled its flagship annual research, “The SHRPA State of HR Industry – Global Executive Insights 2025,” spotlighting a sharp disconnect between HR’s confidence in navigating change and its preparedness for AI-led transformation. While an overwhelming 86% of HR leaders feel confident about their organization’s ability to adapt to disruption, only 29% say they are truly ready for AI adoption, exposing a readiness gap that could hinder long-term transformation outcomes.

In its most expansive edition yet, SHRPA 2025 draws on the insights from more than 1,200 survey responses and 30+ in-depth interviews of HR and business leaders, technology providers, and investors across India, Southeast Asia, the Middle East, and Pacific-ANZ. Representing organizations that collectively influence over $1.7 trillion in revenue and 5.9 million employees, the report delivers actionable insights into the forces shaping the next 12 to 18 months in HR and work tech.

Pushkaraj Bidwai, CEO, People Matters, said: “SHRPA 2025 captures a clear shift in the questions HR is asking today. It’s no longer about whether to transform. It’s about how fast, with whom, and at what cost. The data tells us while leaders are confident about navigating change, there’s a significant gap when it comes to AI readiness. If we don’t address that now, it will hold back real transformation. This report is meant to bring clarity—not just on what’s changing, but on what HR and business leaders must do next to stay relevant, resilient and ROI-focused.”

Key Findings on the State of HR

Among the most significant shifts outlined in the report is the rising influence of borderless talent and innovation ecosystems in driving business growth. As access to niche skills becomes a key competitive differentiator, organizations are being forced to rethink their approach to leadership, AI capabilities, and workforce agility. Notably, access to foreign capital and talent has jumped five spots since last year to become one of the top three factors shaping business strategy, overtaking concerns like inflation and policy uncertainty.

Despite growing investments in HR tech, with a 10–25% rise projected for 2025, the report points to critical execution gaps. While 62% of organizations now report having integrated, progressive HR tech systems (up from 36% in 2024), a lack of internal capabilities, unclear ROI frameworks, and weak adoption continue to stall value realization. In fact, only 1 in 4 organizations have fully adopted GenAI, with most citing capability gaps as the key barrier. The report found that HR is underinvesting in AI capabilities, with only 29% of HR teams prioritizing it, revealing a significant ambition-execution gap.

HR efforts also fall short in mitigating business-critical challenges, with impact gaps of up to 12% across key priorities. Value realization from tech investments is contingent on AI readiness.

Cheshta Dora, Head of Research and Content Strategy at People Matters, noted, “The real test for HR lies ahead. With external volatility, workforce complexity and AI acceleration converging, organizations cannot navigate borderless talent and innovation ecosystems, the need for AI readiness and ROI-focused tech adoption with fragmented bets. SHRPA 2025 is designed to help leaders focus their efforts where it matters most—effectiveness, experience, and value.”

A Strategic Blueprint for HR Transformation

The report outlines three core imperatives for HR and business leaders to close the emerging gaps by strengthening HR’s core agenda, capability mandate, and tech value realization. As organizations gear up for 2025 and beyond, SHRPA offers not just a snapshot, but a strategic blueprint. The message is clear: transformation cannot be driven on optimism alone. It demands clarity, capability, and commitment, and SHRPA 2025 offers the roadmap to get there.