After AI is deeply embedded in organizations, should the roles of CHRO and CTO be merged into one?

In the past few years, the emergence of new AI tools and systems has prompted enterprises to re-examine almost all their existing practices. However, facts have proved that leveraging these new tools to create real value is extremely challenging. Despite the widespread discussions about productivity improvement and process transformation, related investments and experiments have not yielded fruitful results. Many frustrated managers have finally reached a similar conclusion: To truly harvest value from AI, enterprises must view employees and talents in a way different from the past.

What does this "different" way look like? That is exactly where the difficulty lies.

One approach adopted by enterprises such as pharmaceutical company Moderna is to merge the technology department and the human resources department, with one person in charge of unified leadership. The idea behind this is that instead of trying to make two completely different functions cooperate with each other, it is better to rethink the two functions themselves and create a brand-new organizational method for the AI era.

However, this kind of merger is not the only answer, and most likely it is not suitable for your company. To better understand how leaders should think about the proper relationship between technology and human resources, and what questions they need to ask when planning the next step, the English edition of *Harvard Business Review* interviewed three experts. (Spoiler alert first: On the actions that enterprises should take now, their disagreements are almost as many as their consensuses.) The following are their views.

Human Resources and Technology Departments Should Not Merge, But Learn to Lead Jointly

Keith Ferrazzi is the chairman and founder of Ferrazzi Greenlight, a Los Angeles-based global team consulting and coaching organization, and the author of *Never Lead Alone: 10 Shifts from Leadership to Teamship* (Harper Business, 2024).

In the early spring of this year, when Moderna decided to merge digital and personnel work into one executive position, it sent a signal: in the face of AI and automation, enterprises are willing to rethink the way work is designed. In this process, Moderna also realized a problem that many enterprises are currently facing: there is always a disconnect between technological innovation and human adoption. However, merging the organizational structure cannot guarantee that the enterprise will achieve transformation, let alone ensure the business outcomes brought by the transformation, such as improved productivity, shortened time-to-market of products, or better experience for employees and customers. What enterprises really need to do now is to teach leaders how to lead collaboratively across functional departments through shared goals, trust and speed.

In the process of providing transformation consulting for Fortune 500 companies and fast-growing startups, my team and I have studied the breakthroughs and failures of AI transformation in different industries. We found that the success of AI integration largely depends on whether the enterprise can establish a kind of "teamship", where peers, based on honesty, trust and shared responsibility, empower each other and lead together in the pursuit of goals. For example, when the leader of the procurement department tries to restructure the supply chain alone to introduce AI, the result often ends in failure. But if enterprises let departments such as sales forecasting, procurement, manufacturing and finance collaborate to complete the same task, it is possible to create tens of billions of dollars in growth while significantly reducing costs. The difference between the two lies in whether value can be created from mutual dependence.

"Teamship" comes into being when leaders no longer stick to their respective functional barriers and start to create value together. Amy Thompson, Chief People Officer of the clothing brand Gap, and Sven Gerjets, CTO, are excellent examples of this model. I learned about the work they are carrying out after I delivered a keynote speech to Gap employees. Together, they established a "North Star Goal" for the company's technology transformation: to build a human-centric, digitally driven organization that empowers employees, improves customer experience and optimizes products. This approach prompted Old Navy, the largest brand under Gap, to launch an in-store experience program called "Store First", with the joint participation of functions such as technology, human resources, finance and supply chain. All departments collaborated to deploy RFID (Radio Frequency Identification) technology in about 150 Old Navy stores, and planned to expand the deployment to half of the stores by the end of the year. With this technology, store employees can grasp the inventory situation in real time and accurately. This innovation not only improves the customer experience, but also allows employees to do their work more easily and quickly. But its success is inseparable from the joint participation of multiple departments of the company.

Cisco has also adopted a similar "teamship" approach to scale AI across the company in a responsible manner. According to Fran Katsoudas, the company's Chief People, Policy & Purpose Officer, instead of merging departments, Cisco created an "AI Control Hub", a cross-functional collaborative alliance composed of human resources, IT, legal, finance, security and operations departments. The team collaborates at the personnel, data, process and ethical levels to accelerate the deployment of responsible AI. At the same time, it also took the lead in promoting the initiative of reshaping work processes (not just redefining positions), so as to truly release performance improvement and innovation capabilities on a larger scale.

These cases reveal a deeper truth: The AI era requires enterprises to adopt brand-new ways of working, and sticking to departmental barriers is incompatible with the kind of transformation that enterprises are trying to achieve. As Ann Funai, Chief Information Officer of IBM, said, the traditional "each doing their own part is collapsing". Admittedly, this means that it is necessary to completely restructure human resources, IT and every other functional department, but simply changing to new job titles will not help drive transformation. On the contrary, leaders must redefine their respective roles and processes through in-depth collaboration with their peers.

So, what should enterprises do if they do not merge departments? Here are several practices for building "teamship".

Jointly formulate a bold "North Star Goal". Let every action revolve around a clear, company-wide goal. This goal should not only arouse a sense of urgency, but also provide direction for implementation. The best "North Star Goals" should also be linked to measurable results, such as "increasing productivity by 50% within two years", so that the team can not only understand the vision, but also understand the stakes, required conditions and the roles they play in it. Then, further break down this "North Star Goal" into several key tasks, set specific priorities for cross-functional teams, and let all parties share responsibilities and promote them together.

Build a core restructuring team. Form a cross-functional commando (a small team of experts formed to achieve specific goals) that shares responsibilities. Cisco's AI Control Hub is a good example: it truly practices "teamship" based on trust, candid communication and shared responsibility.

Activate a brand-new social contract. Effective "teamship" is not only responsible for each other's results, but also for the way they cooperate with each other.

Use agile sprints to drive results. Agile methods are not only born for software development. Enterprises can adopt sprint cycles with clear goals, responsible persons and measurement indicators, and pay attention to both technical results and human results at the same time. The goal is not just to pursue speed, but to establish a mechanism for the team to learn, adjust and create value together.

Create a 21st-century compatible collaboration method. As teams become more cross-functional and more dispersed, meetings alone cannot complete all collaborative work. You can use an asynchronous "stress test" once a month to test the plan and make it more robust; at the same time, invite all parties to give candid feedback as early as possible, so as to detect risks in time, align quickly, and make adjustments without slowing down the progress.

AI-first startups show what the future could look like. As a partner of Lightspeed Venture Partners, I have noticed that there are no strict boundaries in the early stage of a startup. Founders form a closely cooperating team around a single mission to achieve corporate goals that go beyond their job titles or organizational structure. They are not only proficient in technology, but "teamship" is their basic trait. This is exactly the mindset that all enterprises in the AI era must adopt: break the leadership boundary, focus on shared results, rather than excellence within their respective functional scope.

How to Achieve the Integration of Human Resources and AI

Peter Cappelli is the George W. Taylor Professor of Management at the Wharton School and Director of the Center for Human Resources.

It has always been very difficult to get AI to really enter real work scenarios and make substantial progress, in part because there is so much hype around AI capabilities. These bright promises obscure the reality that it is extremely difficult to implement this technology. What's more, some leaders are misled into thinking that AI is just a plug-and-play tool that can directly replace employees, which makes things even more tricky.

That being said, if we want to push forward the application of AI, clearly thinking about how human resources and AI should be combined is undoubtedly a very good starting point. The reasons are as follows:

To use AI, first of all, we need to understand what the current work is really like and how it is specifically completed. A typical job may even contain dozens of tasks. For example, computer programmers do not spend most of their time writing code, but dealing with other tasks (negotiating requirements with customers, striving for resources, adjusting work when dealing with changing requirements, etc.). Under each task, there are many more subdivided tasks. Taking striving for resources as an example, it may include inquiring about prices from suppliers, preparing reports, submitting project proposals, etc. Only by going deep into this level, that is, "the tasks within tasks", can AI really have the possibility of being introduced.

For example, to let AI participate in the specific task of summarizing the prices of parts and components, employees need to make extra efforts before AI can really create value. If employees are unwilling to help train AI agents, it will be very difficult to make it really work. If employees are unwilling to use the results generated by AI agents, this project will also fail. If they think that the goal of the enterprise is to let AI agents replace their jobs, don't expect all this to succeed. In knowledge-based work, there are hundreds of ways to bring a project to a standstill.

What's more troublesome is that AI is far from management. Many knowledge workers know almost nothing about how AI works and what it can actually do (so do many leaders). And many IT and AI practitioners know very little about management. Both sides lack understanding of organizational change, which is exactly the issue we really need to discuss.

So, how do we solve this problem in AI implementation? Having a person in charge who is proficient in both fields will be of great help. Of course, an obvious (but still very worthy of emphasis) note is: if a person who only understands one side is allowed to be in charge of both human resources and AI at the same time, it is likely to be a disaster. Only when an enterprise can find the right person who is truly proficient in both can this position play a role.

My judgment is that it is relatively easier to teach HR practitioners the AI knowledge they need than to teach AI practitioners about human resources. Part of the reason is that human resources covers a very wide range, including many jobs that are not closely related to each other, such as legal affairs, compensation and benefits, training, etc. It is easy to say "make employees responsible for their own performance", but the real challenge is how to do it exactly.

On the other hand, for technical personnel whose work culture is highly built on professional knowledge, if they are asked to belong to the human resources department, they will probably be completely unacceptable.

However, having one person in charge of both roles is not the only option. A better way is to form small teams — one HR person plus one AI person, let them work on specific projects, and assist employees in different positions to think about how to apply AI to their own work. For organizations that know how to use matrix management, these teams can be further embedded in the organizational structure, so that they belong to both IT and human resources at the same time.

No matter which method is adopted, some training is needed — more precisely, explanation and communication, so that the two worlds can understand each other. It is not easy to integrate AI into existing work, and leaders must recognize this. They need to dig out the dusty organizational change textbooks again and make this work a top priority.

Start from the Company's Priorities and Do Not Pursue a Perfect Organizational Structure

Kalifa Oliver is a well-known global expert in the field of human resources, an employee experience strategy expert, and the author of *I Think I Love My Job: Secrets to Designing a People-Centered Employer Value Proposition* (Press 49, 2024).

As enterprises continue to increase their investment in AI, the scope of human resources work is changing rapidly. AI-driven tools, predictive workforce analysis, and digital-first employee experience are blurring the boundaries between human resources and technology leadership functions, and this trend seems to be accelerating. Nowadays, many companies are asking: Is merging the human resources and technology departments under a single leader the solution?

To answer this question, I talked with three HR executives who are at the intersection of "people and technology". In every conversation, there is a consensus that runs through: the impact of technology on HR is unstoppable, and the real problem is actually "when" and "how" the company will adapt. However, that's all for the consensus. The following are their views.

Minh Hua, Chief People Officer of the Estonian postal group Omniva, believes that if human resources and technology are to be led by the same person, it is necessary to find a leader who can combine systematic thinking with human empathy, and such a candidate is probably to be found from the technology department. "Nowadays, there are more tech leaders with high emotional intelligence than HR leaders who understand AI and the technology stack," he said.

Meisha-ann Martin, vice president of people research at the employee recognition platform Workhuman, believes that focusing on the organizational structure is thinking about this challenge from the wrong angle. "We rely too much on the formal organizational structure, which is harmful to us," she said. Instead of over-sorting out reporting relationships, Martin emphasizes in-depth cooperation and joint execution: "Maybe we need to shift from passive watching to actively cooperating with everyone."

Julia Anas, Chief People Officer of the experience management software company Qualtrics, emphasized that the integration of these two parts of the organization is inevitable in the end, and a well-thought-out talent strategy will also require enterprises to start helping employees develop new skills from now on to keep pace with the times. "Merging HR and technology leadership is not a fad, but building a solid foundation of humanity, hybrid form and digitalization for the future workforce," she said. When used properly, technology can expand the boundary of human capabilities, allowing people to spend more time on things that really matter and less time on invalid affairs. Therefore, technology should be part of the enterprise's talent strategy.

Faced with these conflicting suggestions, how should leaders choose? Instead of starting with the organizational structure, it is better to think about the ultimate goal of the organization first.

It is very important whether the organization is building a people-centric management system to expand trust, transparency and adaptability. Technology can amplify these values, provided that it is matched with a well-designed employee success strategy. At present, the traditional human resources model based on daily affairs, compliance and administrative management can no longer meet the needs. Today's workplace requires greater agility, more personalized management, and data-driven insights, while the old human resources model can no longer keep up with the rhythm and complexity of modern work. Therefore, leaders need to think about how to build an organization with clear goals and clear directions, to better serve the public, customers and employees. This means reducing departmental barriers and strengthening shared responsibilities.

So, is the merger of HR and technology leadership happening? The answer is yes. But does this mean that the two must be merged? Not necessarily. What is really inevitable is integration. The leaders I interviewed agreed on one point: technology will reshape human resources. As for how this will happen specifically, it depends more on whether the enterprise has clarified its own priorities than on the organizational structure.

Visionary leaders should ask the following questions when integrating HR and technology leadership functions:

What problem are we trying to solve? Is our goal to improve efficiency, improve employee experience, or drive innovation? Will merging leadership functions accelerate the achievement of these goals, or will it create new bottlenecks?

Where do we most need to maintain balance? Which HR work can benefit from closer technology integration? Which work needs to focus solely on people, culture and empathy?

Is the organization ready in terms of structure? Do we have the governance mechanisms, data infrastructure and professional capabilities needed to effectively combine the two functions? Does the joint leader have the energy and vision to properly manage both functions?

What signal will this send to which stakeholders? Putting human resources and technology under the same leader will elevate the status of the talent strategy, or may send a signal that "people are just appendages of technology"? How does this choice align with our culture and values?

Are we investing in both areas? Did we sacrifice human capabilities for technology investment, or vice versa? How do we ensure that the leadership model reflects equal emphasis on talent and AI infrastructure?

Whether through a formal organizational structure or through collaboration between functions, the barriers between human resources and technology are disappearing. The question is no longer whether human resources need to adapt to technology — it must adapt. The real question is: can merging leadership functions bring clarity and focus? Or can strong collaboration between two leaders who are each responsible for different functions achieve a better balance instead?

The correct answer is different for every enterprise, but not thinking about this issue at all is a big mistake in itself. What really seems to matter is not who is in charge of what, but whether the enterprise can achieve consistent goals and coordinated progress when designing its personnel system, so as to make the organization more agile, efficient, sustainable and resilient.

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