HR Departments Face Reckoning as Companies Embrace AI
The question facing companies that are betting on AI is stark: Do you still need human resources? Bolt CEO Ryan Breslow answered it by eliminating his HR team entirely.
Breslow made the announcement this week at Fortune's Workforce Innovation Summit. The fintech company, which he cofounded in 2014, had contracted sharply after its valuation dropped from $11 billion in 2022 to roughly $300 million. Headcount fell from 2,500 to about 100 as the company shifted to what Breslow calls "wartime footing."
But the case for eliminating HR entirely remains contested. Himanshu Palsule, CEO of Cornerstone OnDemand, a learning and talent software company, argues the opposite: managing people is more critical than ever, even as the work itself transforms.
Cornerstone launched an AI platform this week designed to assess, train, and mobilize employees. Palsule's core argument is functional: AI agents will fail without strong people management behind them.
"If you lose your people, those agents aren't doing anything in your company-they're just creating chaos," he said.
What's Changing in the Workforce
Palsule identified three shifts HR leaders need to address immediately.
Generation Z is being overlooked. "The greatest irony of our time is we are leaving out a generation that's most skilled to do AI," Palsule said. Companies trained Gen Z on digital tools from childhood but now dismiss them as inexperienced. That's a strategic mistake.
Knowledge work is being automated, not eliminated. Routine tasks like tax preparation are moving to software. But this creates opportunity: tax agents now advise on wealth strategy. Workers who adapt will shift from execution to judgment and design. "Your ability to build products, use judgment, use inference, use delight in how you bring it to market-that is never going to go away," Palsule said.
Experience matters less than learning speed. A 40-year career teaches you how things worked, not how they work now. Leaders need humility about what their experience is worth in an environment changing faster than expertise can accumulate.
What HR Leaders Should Do Now
Palsule outlined concrete steps for HR executives managing this transition:
- Set clear success metrics with your board and educate them on what will break along the way
- Tell employees directly that jobs are changing and some roles will be eliminated-don't hide from it
- Give people the tools to succeed in the new structure
- Model continuous learning yourself
The debate over HR's value in the AI era isn't about whether humans matter. It's about whether HR functions can evolve fast enough to help organizations manage the people side of AI adoption-or whether they'll become obstacles to it.
Learn more about AI for Human Resources and explore the AI Learning Path for CHROs to build the skills your role demands.
Your membership also unlocks:
