Just about everyone agrees that the traditional, annual-review-based way of evaluating employees simply doesn't work anymore, if it ever did. In fact, it's hard to think of anything businesses routinely do that's more universally unpopular. A recent global Mercer survey of HR leaders worldwide found that just 2% believe their current performance-management systems are very effective. No wonder McKinsey reported, in another recent study, that two-thirds of employers say they're making big changes, or trying to. "Managers and employees alike see the old annual-review approach as too subjective, too bureaucratic, and too backward-looking," notes Bryan Hancock, a McKinsey partner in Atlanta who has worked closely with companies where artificial intelligence is being applied to evaluating humans' performance.

IBM says within the next three years 120 million workers will need to learn new skills as a result of artificial intelligence (AI) in the workplace. The skills range from cybersecurity and data science to front-end and full-stack developers, according to IBM chief talent officer Diane Gherson. "These are the hotter skills out there in the market right now," she told FOX Business' Maria Bartiromo on Wednesday. "You're finding a shortage and every company is going to have to start developing these skills because they don't exist in enough numbers." And, according to Gherson, whether it's banking or industrial, every single company is "tuned into" AI of some kind. What's more, she said if you're not including AI in your business, you'll be left behind.

For the next installment of our interview series with leaders who are transforming the role of the chief human resource officer, David Reimer, the CEO of Merryck & Co. Americas, and I sat down recently with Diane Gherson of IBM. Her insights and perspectives provide a clear window into how technology is fundamentally changing the HR function. Stay tuned for more interviews with other HR leaders. What are your thoughts on the phrase "strategic HR?" What does it mean to you? A. In the old days, strategic meant taking the business strategy and translating that into what it meant for the various functional groups you might have in HR, and to a certain extent, how you would allocate your resources. But then it became much more about actually sitting at the strategy table and focusing more on, given our talent, the things that will give us a competitive advantage.

When it comes to the forefront of the global human resources landscape, Diane Gherson is someone you want to know. As Chief Human Resource Officer at IBM, Diane has helped to revolutionize IBM over the past 13 years. Under her leadership, she has transformed global workforce outcomes through talent analytics and data, with special emphasis on predictive analytics. I interviewed Diane to learn her thoughts on several topics, including the future of work, how technology is disrupting human resources, how to build a lasting culture, the best way to give feedback, her favorite interview question, her best career advice and where she eats breakfast. Zack Friedman: It's no secret that technological innovation brings rapid disruption.