AI could help large companies run with fewer employees, says Eric Schmidt
The former Google CEO suggested that artificial intelligence might eliminate roles focused on planning and administration, which he termed 'glue people'.
Former Google CEO Eric Schmidt believes artificial intelligence could allow large companies to operate with fewer employees by reducing the time spent on coordination. Speaking to Nicolai Tangen on the In Good Company podcast, Schmidt suggested that businesses could potentially eliminate roles dedicated to planning and administration.
Schmidt described these roles as 'glue people' who handle tasks such as moving numbers around. He used a hypothetical company of 10,000 people to suggest that a couple of thousand such employees might not be needed.
According to the Times of India report, Schmidt referred to the effort spent organising work between departments as a 'coordination tax'. He said much of this tax could be eliminated by AI platforms.
The former CEO noted that while administrative work could be absorbed by AI, companies would still require inventors, salespeople, leaders, and employees to communicate with governments.
Schmidt cited an example of a friend whose rapidly growing company decided to cut 20 per cent of its workforce. He mentioned that the executive involved had written about the decision in The Wall Street Journal and later received death threats.
Schmidt also questioned if established businesses would undergo the cultural changes necessary to benefit from AI. He argued that most companies might resist reorganising their structures and routines to adopt the technology.
