Gartner: How CIOs can lead the talent remix

Repositioning fulltime employees 

First, an analysis of what is actually happening at the companies driving the news cycle. The high-profile layoffs at firms like IBM, Salesforce, and major consulting houses are not evidence of a simple automation-driven job apocalypse.

These moves are not about productivity at all; they are a commerce-driven strategy known as Experience Redistribution. 

This is a “Talent Remix”. These organisations are strategically reallocating human capital, cutting from low-performing or legacy business lines to fund a massive pivot toward net-new AI revenue streams. IBM, for example, stated that while some back-office roles were replaced, its total employment actually increased to fuel investment in its AI consulting services. Salesforce laid off 1,000 employees while simultaneously creating 2,000 new sales roles specifically to sell its new AI products.

This is a commercial pivot to capture new markets. Gartner analysis of workforce events in the first half of 2025 confirms this. Of the more than 241,000 job events studied, 79% were not AI-related at all. Critically, 17% were attributable to this "Reposition" strategy, while less than 1% were caused by AI-driven productivity layoffs.

The takeaway for CIOs is stark: if your business is not pivoting to sell AI software, hardware, or consulting services, this strategy is not your strategy. 

Restraining hires 

For the majority of enterprises, the most common and immediate talent impact of AI is not layoffs but Restrain Hiring. 

This strategy is enabled by a talent pattern termed Experience Starvation. The mechanism is rooted in human behavior: organisations deploy AI assistants to their most experienced, high-complexity workers (engineers, analysts, consultants) to make them more productive. When a new task arises, that senior employee finds it faster to complete the work themselves with their AI assistant than to mentor a junior through the process.

The natural apprenticeship model breaks down. As a result, when demand for work increases, the organisation feels less pressure to add junior headcount.

This delivers a real, but limited, financial benefit: cost avoidance. The organisation is not reducing current staff numbers; it is avoiding hiring new ones. This is a crucial distinction. It prevents future costs from being added, but it does not create a cashable saving from the current payroll that can be harvested and redeployed. 

There is real risk here. This strategy starves the future talent pipeline, creating a critical vulnerability, as AI will not replace the roles that require the discernment of experience, the very experience it is no longer cultivating.  

Reducing Headcount

This brings us to the strategy that most executives believe they are asking for: Reduce headcount. 

This strategy relies on a pattern called Experience Compression, where AI radically increases the proficiency of junior staff in low- to mid-complexity roles. The classic example is a contact centre, where an AI tool guides a new agent through complex issues, making them as effective as a senior agent. 

In practice, however, this goal is proving highly elusive and is not yet being realised commonly at scale. The hurdles are immense. 

First, the productivity gains are simply not large enough. Eliminating roles requires a functional productivity increase between 30% and 65%. Current research shows that even one of the most successful use cases, customer service, tops out at a 14% to 34% gain. This is often below the minimum threshold required for material headcount reduction. 

Second, any anticipated gains are lost to "productivity leakage". A 10% efficiency gain for one team member often translates to only a 1% process improvement due to workflow bottlenecks and coordination overhead.

Most importantly, sustainable cost savings only flow from transformed workflows, not from the premature harvesting of headcount. This requires deep, foundational process reorganisation before any cuts are made. The effort and cost associated with that process redesign is often one to three times as large as the cost of implementing the AI technology itself. Attempting large-scale layoffs without this foundational work is a direct path to operational instability.

A framework for strategic action 

The CIO's mandate is to lead the C-suite from pressure to precision. This requires a new framework for action. 

• Diagnose and Align: The first action is diagnosis. CIOs must identify which AI talent strategy aligns with the organisation's current strategic goals and ensure alignment on this reality among executive peers. This includes setting clear expectations on timescales. "Reposition" strategies are underway; "Restrain" strategies are happening now and will likely increase; "Reduce" strategies are not yet occurring at scale. 
• Prioritise the Talent Pattern: The second, and most critical, step is to create the corresponding talent pattern before executing an AI talent strategy. Layoffs or hiring restraints must start with creating the right talent foundation. Executing the strategy without the underlying talent pattern in place often leads to operational instability. 
• Counteract Experience Starvation: Third, organisations must deliberately counteract Experience Starvation, which is a likely outcome for most. As senior employees absorb more tasks with AI assistance, junior talent pipelines are threatened. Best practice involves creating GenAI-powered simulators, allowing protégés to practice complex, domain-specific scenarios in a safe environment, gaining vital experience before real-world decisions arise. 
• Pivot to Financial Efficiency: Finally, for technology leaders facing a non-negotiable mandate for near-term cost reduction, productivity initiatives are an unreliable path. Layoffs will not deliver savings fast enough. The more effective answer is "financial efficiency”, using AI not to make people faster, but to make finances and cash more efficient. This includes applications like optimising vendor contracts or working capital. This approach targets budget line items directly, delivering measurable impact without the friction of premature headcount reduction. 

The strategic imperative 

AI is fundamentally changing the workforce. Every executive team will need an AI layoff strategy, even if that strategy is a deliberate decision not to pursue layoffs. In the current environment, this must be a conscious, well-reasoned choice. If an organisation decides to act on AI-driven talent changes, the approach must match its core business strategy and its foundational talent patterns. Retreating from this question under the guise of human-centricity is a mistake.  Having a deliberate strategy is the most humane approach for the organisation. Without it, any actions taken become mere reactions.

Nate Suda is a senior director analyst at Gartner.

Gartner analysts will further explore how AI is reshaping enterprise structure, talent and leadership at the Gartner IT Symposium/Xpo in Barcelona, from 10–13 November 2025.