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NewslettersFortune CHRO

AI could upend organizational hierarchy and force employers to rethink leadership development

By
Paige McGlauflin
Paige McGlauflin
and
Joey Abrams
Joey Abrams
Down Arrow Button Icon
By
Paige McGlauflin
Paige McGlauflin
and
Joey Abrams
Joey Abrams
Down Arrow Button Icon
November 29, 2023, 8:30 AM ET
Renée McGowan, CEO of Marsh McLennan's India, Middle East & Africa business, and Taso Du Val, CEO of Toptal, at Fortune Global Forum in Abu Dhabi.
Renée McGowan, CEO of Marsh McLennan's India, Middle East & Africa business, and Taso Du Val, CEO of Toptal, at Fortune Global Forum in Abu Dhabi.Katarina Premfors for Fortune

Good morning!

The AI revolution could affect as many as 300 million jobs, according to Goldman Sachs. These days, it seems no role in the corporate food chain is safe—from low-level tech jobs to the CEO role. What’s more, AI is poised to disrupt how companies are structured in the future, undoing the typical organizational hierarchy.

“These hierarchical structures that typify a lot of large organizations around the world will ultimately be replaced with structures that will be far more agile, where there’ll be far more fluidity of people doing tasks and skills,” said Renée McGowan, CEO of professional services firm Marsh McLennan’s India, Middle East, and Africa business, during Fortune’s Global Forum conference in Abu Dhabi on Tuesday.

Indeed, some studies have found that supervisory roles, like project managers, will likely see more role displacement from AI than their entry-level counterparts. Luckily for managers, more employers prefer to upskill and reskill employees than find new AI talent, a finding that Taso Du Val, CEO of freelancing platform Toptal, says he found surprising.

“A lot of folks would think, ‘We need a new person or a new set of folks to create AI strategies and execute,’” he said. “In fact, it’s a small group that enables everyone to leverage AI and those efficiencies from that strategy in order to benefit the organization.”

Leaders will also need to establish how early-career workers progress through the organization, especially as AI replaces rote tasks that are typically relegated to junior employees.

McGowan says that both employees and managers should ask themselves, “In your early career, what are the skills that you’re going to need to learn, and how do we expose you to those skills throughout the organization to map to either the leadership models or the technical models that we need in the future?” Some companies are already doing so, like ServiceNow, which uses generative AI to optimize team performance, identify training needs for employees, and hire for relevant skills.

“It’s about redeployment and thinking about work differently,” McGowan says.

Check out more coverage from Fortune’s Global Forum here.

Paige McGlauflin
paige.mcglauflin@fortune.com
@paidion

Reporter's Notebook

The most compelling data, quotes, and insights from the field.

Getting return-to-office mandates to stick isn’t just a private sector issue. The Biden administration has increased its messaging cadence, urging federal employees to come back to the office. But administration officials say they have yet to reach their return-to-office goal, according to a report from the Wall Street Journal.

Around the Table

A round-up of the most important HR headlines.

- Black women at large U.S. companies were promoted at half the rate of men of all races in 2022, a nearly 50% drop from the previous year, according to McKinsey data. Black men saw a similar but less dramatic drop in promotion rates. Wall Street Journal

- AI will have the largest effect on management consulting employees, according to new U.K. government research. Workers in finance, accounting, economics, and psychology followed. Financial Times

- Around half of U.K. employers told job site Indeed that their employees are too casual in the office, wearing unacceptable clothing and sporting unkempt hair. Almost one-third have implemented or want to implement dress codes. WorkLife

Watercooler

Everything you need to know from Fortune.

Talent grab. Morgan Stanley, Citigroup, and Wells Fargo have poached dozens of AI staffers from Wall Street neighbors Goldman Sachs and Bank of America as the AI talent frenzy continues. Some of these U.S.-based employees see starting salaries above $900,000. —William Shaw, Bloomberg

City slackers. One out of every five workers in Paris is forbidden from working from home compared to just 4% of London workers, Bloomberg Intelligence finds. For a majority of Londoners, it would take a double-digit pay raise to return to in-person work. —Eamon Akil Farhat, Bloomberg

Leveraging AI. Two neurodivergent employees spoke to Fortune about how AI tools like ChatGPT help them better communicate with coworkers and dissect complex assignments. —Chris Stokel-Walker

Remote dreams sink. Remote workers rushed to secure spots on a three-year cruise around the world that cost more than $30,000 annually. But the company canceled the trip earlier this month because it couldn’t find a ship on which to ferry those adventurers. —Chris Morris

This is the web version of CHRO Daily, a newsletter focusing on helping HR executives navigate the needs of the workplace. Sign up to get it delivered free to your inbox.

About the Authors
By Paige McGlauflin
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Joey Abrams is the associate production editor at Fortune.

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