AI will evolve into organizational strategy for everyone

Ever since inventing the organizational chart in 1850 company structures have changed very little – they are hierarchical and consist of multiple levels of managers and decision makers. This is because we are bound by the limits of human intelligence and attention to manage and control the workflow. AI can change that. In large language models (LLMs), we have a new, alien form of intelligence, but one that has worked primarily as an assistant at the individual level. In 2025 we will begin to see the first organizations built around the combination of humans and AI working together.

This change represents a fundamental shift in the way we structure and manage our businesses and institutions. While the integration of AI into our daily lives has happened very quickly (AI assistants have some of the fastest product adoption in history), so far organizations have seen limited benefits. But the coming year will mark a tipping point where AI moves from a tool for individual productivity to a core component of organizational design and strategy.

In 2025 forward-thinking companies will begin to rethink their entire organizational structure, processes and culture around the symbiotic relationship between humans and artificial intelligence. This is not just about automating tasks or augmenting human capabilities; it’s about creating entirely new ways of working that leverage the unique strengths of both humans and AI. The key to unlocking the true power of LLM lies in moving beyond individual use cases to organization-wide integration. While we’ve seen impressive results from people using AI assistants for tasks like writing, coding and analysis, the real transformation will occur when entire organizations are built around human-AI collaboration.

Startups are leading the way. Venture capitalists report a growing trend of portfolio companies pledging to maintain lean teams of no more than about 30 people, relying on AI to scale their operations without traditional overhead. However, the benefits of this approach can be even more significant for large, established organizations. These companies have the potential to use AI to bypass inefficiencies, unlock new growth from existing talent, and tap into the collective intelligence of their workforce in ways not possible before.

In 2025 we will see a rise in AI-based startups that build their entire operating model around human-AI collaboration from day one. These companies will be characterized by small, highly skilled human teams working together with sophisticated AI systems to achieve results that rival those of much larger traditional organizations.

For larger companies, the journey to becoming an AI-integrated organization will be more complex, but potentially more rewarding. These organizations will need to undertake significant research and development efforts to understand how best to use AI in their specific context. This process will reveal an important truth: Because AI works less like traditional software and more like a human (even though it isn’t), there’s no reason to assume that IT has the best AI prompters or any particular insight on the most effective use of AI within the organization.

Thus, while IT will certainly play a critical role in implementing and maintaining AI systems, the real use cases and innovation will come from workers and managers across departments who discover opportunities to use AI to improve their work. Indeed, for large companies, the source of any real advantage in AI will come from the expertise of their employees, which is necessary to unlock the latent knowledge and capabilities within AI systems. This realization will democratize the use of AI in some organizations, and they will be the ones to drive the coming transformation.

The organizational structures that emerge from this integration of AI will look significantly different from the traditional hierarchies we are used to. We may see the rise of more fluid, project-based structures, where teams form and dissolve quickly around specific goals, with AI systems acting as connectors and facilitators. Middle management roles may evolve to focus more on human-AI coordination than traditional supervisory tasks. In 2025 the most successful companies will not be those with the most advanced AI technologies, but those that can most effectively combine human and artificial intelligence to create new forms of value.