How Do You Organize for AI Transformation?

Rethinking Leadership Partnerships

Despite massive investments, most CEOs report disappointing returns on AI initiatives. Ninety-three percent of leaders cite “human factors” as the primary barrier. Yet here’s the paradox: while organizations recognize that AI requires redesigning work, not just deploying technology, they continue organizing AI initiatives the familiar way—technology roadmaps, system implementations, leadership by the Chief AI Officer. If AI is truly about organizational transformation, why are we treating it like a technology project?

The Org Chart Won’t Solve This

Moderna merged its CHRO and CTO roles—a bold signal that technology and people are now inseparable in how organizations think about capability.

But reorganizing won’t change outcomes if functions continue operating in silos. What’s needed is redefined mandates and shared purpose—requiring leaders to fundamentally rethink how they partner across boundaries.

Co-Leadership in Practice

AI transformation requires a unified C-suite direction: a clear definition of AI’s purpose, how the organization will approach it, and the value it will create. This alignment anchors cross-functional collaboration.

But direction without execution is merely aspiration. That alignment must then translate into action where transformation actually happens: in departments redesigning core processes.

Consider this scenario

The Head of Sales sits down with IT, HR, Finance, and Sales Operations to redesign sales forecasting.

Sales brings pipeline dynamics and commercial implications. IT brings AI-enabled forecasting models. HR brings insight into how teams work, capability gaps, and how incentives shape behavior. Finance brings planning requirements—how forecasts drive resource decisions. Sales Operations brings systems, data infrastructure, and process constraints.

Together, they examine the end-to-end decision flow: where data is generated, where quality breaks down, which steps require human judgment, and which can be automated or augmented by AI. Then they determine how roles shift, what capabilities people need, and how metrics and incentives must change. This is organization design work—and it requires all these perspectives. The value isn’t deploying a tool; it’s redesigning how forecasting gets done.

Making Partnership Work

Genuine cross-functional partnership is challenging. Organizations have spent decades optimizing for functional performance. Specialists are hired, developed, and rewarded for domain expertise. Incentives, budgets, and career paths reinforce functional strength.

AI requires leaders to work differently: share ownership, understand adjacent disciplines, and be jointly accountable for outcomes. This is not a small shift.

What enables success?

• Joint accountability for outcomes: Shared metrics remove the handover mindset that undermines collaboration.
• Dedicated capacity: Progress requires protected time and resources for cross-functional redesign, not occasional coordination meetings.
• Mutual fluency across domains: HR must understand technology implications. IT must understand organizational design. Business leaders must understand both.
• Iterative learning: Effective teams start with focused scope, learn through shared problem-solving, and scale only when trust and clarity are established.
• Visible reinforcement: When enterprise-level collaboration is recognized and rewarded, leaders change behavior. Most organizations still reward functional excellence; this must evolve.

What’s at Stake

AI will fundamentally reshape both HR and IT as functions.

HR’s future is not administering programs or managing the “people side” of change; it is “co-architecting” how work is structured in organizations where humans and AI collaborate.

IT’s future is not implementing technology as a service function; it is advising on AI capability and co-designing work alongside HR and business partners.

Organizations that address this challenge effectively will not simply implement AI more successfully. They will reinvent—and future-proof—their HR and IT capabilities.

Partner with Degree23

At Degree23, we help organisations make HR a driver of business results. Bringing your strategy to life both within and via the HR organisation.

Whether you’re looking to build a workforce of humans and AI-agents or start with building shared ownership to define what you need, we’re here to help.

Let’s talk about your strategy: hello@degreetwentythree.com