Orgvue’s 2025 survey of artificial intelligence (AI) and workplace transformation reveals organisations caught in a maelstrom: across sectors, firms are scrambling to jump on the tech bandwagon with limited clarity of where it is heading, or why.
Naturally, the survey hints at exceptions. Nine-tenths of businesses judge their investments in AI to have already delivered value, and over a third of leaders are confident that AI will make their teams more productive by the end of the year.
The worry for employees, including many managers, remains: how will AI affect jobs and livelihoods? The Orgvue survey foretells a bleak future: 48% of leaders say AI will replace people in their organisations, whilst 34% have already seen employees leave because of the technology.
The hidden value chain
But, how wise are we to adopt AI as a replacement for people?
Of the 39% of leaders who have made colleagues redundant on account of AI, 55% now say they made the wrong decision. Whilst the Orgvue account does not explain the regret, likely factors are skills and the difficulty of enabling people and machines to work together.
Simplistic AI hype is misleading
Transformation realities aside, I believe there is at stake a more fundamental issue. Silicon Valley, playing on boardroom fears about cost-efficiency and keeping up with the robotic Joneses, has spooked many teams into a reduced understanding of the value their businesses create.
The result? Knee-jerk decisions that underestimate the creative potential of the value chain. Still, managers cannot be blamed for jumping on the bandwagon – the economy is unfavourable, work complex and AI hype designed to aggravate fears of missing out.
But Silicon Valley misses the point.
Lessons from offshoring
This is a moment of déjà-vu. Toward the end of the 20th century, transnational companies became excited about offshoring (commonly in tandem with outsourcing). As with AI, cost-efficiency dominated strategy. Managers exploited wage differences across global labour markets and wielded buying power over niche suppliers.
Resilient operations, speedy innovations and low costs – the business case was seductive. Boardrooms acted at pace, often with an anxious eye on start-ups and competitors across the road.
By 2019 the pendulum had swung back. The European Reshoring Monitor noted over 250 high‐profile reshoring cases within four years, including Apple, Ford, General Electric and NCR, which brought some 1.3 million jobs back to the United States.
Wages, it turned out, were a small element in the ecosystem of global business. The hidden costs of moving offshore and the complex value these strategies failed to account for – not least in customer service – ultimately forced companies to make a U-turn.
The lesson? What matters to a business may not be obvious from a spreadsheet.
How to avoid AI regret
The hidden costs of replacing humans with AI and robots will exceed those revealed by the offshoring craze. Further, it will be harder to turn back the clock. AI will have a deep and lasting impact on labour markets, firms and society – and, of course, on people.
The discourse on AI emphasises cost, efficiency and speed; it argues that outputs from human and machine are comparable: why pay a copywriter £10,000 for a few web pages when ChatGPT can spit out (almost) the same, and more, for 20 dollars a month?
For many roles, however, this narrative takes insufficient account of value beyond the spreadsheet.
Never fire the doorman
Consider for a moment the hotel doorman. The doorman makes guests feel welcome; he keeps out undesirables; his dress and rituals mark where special experiences begin and end. The doorman contributes to the bottom line via repeat business and higher rack rates.
The narrative on tech efficiency is blind to the value of this employee, for it reduces his role to that of a mechanism to open and shut doors: two sensors, one electric motor, and automation is complete. As advertising stalwart Rory Sutherland says, paring the job to its functional core ignores the doorman’s value to both hotel and guests.
Cost-conscious managers who replace the doorman fire the gun on a race to the bottom, for every hotel can buy the same mechanism to operate its doors. As firms discovered with offshoring, across many aspects of the value chain, low cost is rarely a competitive advantage that lasts.
Bet on people, not AI
If AI can truly replace your people, then what value are they creating? The employee who does no more than swing a door is a poor doorman indeed. After all, an imaginative business uses the necessity of a building entrance to create experiences that encourage guests to return.
Just as any hotel can buy a door mechanism, so your competitors will buy AI technologies similar to, or better than, those you are using to replace your people. Any first-mover advantage will be quickly lost. (Proprietary training data may slow down, but will not halt, this market process.)
It is wiser to bet on your people, who, when managed well, are a unique asset. Whilst AI may lower costs in the short term, the technology may harm the value that humans create:
- Employees: Who wants to polish the output of generative AI?
- Consumers: Who wants medical advice from an avatar?
- Shareholders: Who wants to invest in advantage that cannot last?
Clearly, a wasteful or unresponsive business will not thrive. And, without doubt, there are roles where AI can pick up drudgery. If we take AI as ‘just another tool’ (as we should), solutions may ease workload or amplify performance without replacing people.
To enrich employees, customers and shareholders, we must reject Silicon Valley’s impoverished notions of what makes for good business. Our job is to imagine novel ways to do more through people, and not less. Only this way can AI help us thrive.
