Using AI to Assist With Organizational Rightsizing and Layoffs

Employees holding boxes with their work stuff - Workforce Management

Rightsizing is a necessary process for organizations seeking to optimize their workforce. Traditional approaches rely heavily on subjective human evaluation, leaving room for biases and inconsistencies. Artificial intelligence (AI) can streamline rightsizing without sacrificing the human factor once you know where to ask for AI assistance. 

Advanced AI systems enable rapid, objective skills assessments and performance reviews across the entire workforce. By creating detailed employee profiles, AI can present data-driven rightsizing decisions based on business needs. AI can also identify reskilling and redeployment opportunities to retain top talent, match employees’ strengths to new roles, support workforce transitions, and minimize layoffs.

When used efficiently, AI-aided rightsizing increases fairness, retains high performers, and optimizes skills distribution. AI workforce optimization promises new efficiency, objectivity, and insight. AI can transform rightsizing from an uncertain process into an opportunity for strategic planning. AI also enables organizations to tap into the fullest potential of their most valuable assets – their people.

Using AI in Organizational Rightsizing

Rightsizing organizations to optimize performance and efficiency has historically been problematic.  AI can expedite this process and use analytics to remove reactionary elements. By analyzing performance metrics and predicting future trends, AI provides valuable insights about where to allocate more resources or streamline operations.

By combining predictive analytics with efficient data processing, AI enables more informed, proactive rightsizing. Companies can move from reactive cost-cutting to data-driven alignment of resources and business goals. With AI’s help, rightsizing becomes a strategic optimization tool rather than a necessary evil.

Harnessing Data for Informed Decisions

You need a comprehensive understanding of your workforce’s skills for effective rightsizing. AI excels at creating detailed skills inventories, providing an overview of each employee’s capabilities.

With an inventory of skills data, redundant roles are easier to identify, and individuals with transferable skills can be reassigned, preserving talent while maintaining efficiency. AI enables data-driven workforce analysis to optimize rightsizing decisions.

Mitigating Bias with AI

Rightsizing often faces criticism when perceived biases influence workforce decisions. AI’s unbiased algorithms help address this problem. When properly trained, AI systems can analyze employee data and make recommendations without human prejudices. As an article in the Harvard Business Review notes, AI can bring more equity to rightsizing.

AI enables a workforce strategy that respects diversity and equality – critical considerations in today’s business climate. AI-powered analytics promote fairness in rightsizing.

Smoother Offboarding with AI

AI-enabled HR tools also facilitate structured, empathetic exits. By automating administrative tasks and providing data to inform decision-making, AI systems allow managers to focus on ensuring respectful transitions.

AI optimization coupled with human compassion enables offboarding with dignity, smoothing rightsizing’s hardest element.

Key Takeaway: 

AI is changing the game for organizational rightsizing. It makes decisions strategic, not just reactionary, by analyzing metrics and predicting trends. AI also speeds up data processing and creates a comprehensive skills inventory to help with reassignments. Moreover, it ensures unbiased decision-making for an equitable process and aids in respectful offboarding.

AI and Performance Evaluation

Employee performance evaluation is crucial for organizational development. However, traditional evaluation methods can be inconsistent, biased, and limited in the data utilized. AI provides a transformative alternative for employee assessment.

AI continuously gathers data from communication tools, productivity software, CRM platforms, and other systems employees use daily, analyzing metrics that manual evaluations would miss. Machine learning can detect nuanced patterns across massive datasets, deriving comprehensive insights.

These AI-generated evaluations provide a detailed picture of how employees perform over time. The analysis highlights individual strengths, weaknesses, working styles, and areas that need development. Unlike subjective human observations, AI assesses performance across all roles and teams without biases, using algorithms to objectively analyze individual improvements and contributions to organizational success.

AI takes performance evaluation to the next level making it an integrated, intelligent system for nurturing talent across the organization. AI’s untiring statistical analysis elevates evaluation from subjective guesswork to an engine for improvement. AI-enabled assessment brings out the best for both employees and companies.

Tracking Performance Patterns with AI

In addition to identifying strengths and weaknesses, machine learning algorithms can provide personalized recommendations for improvement based on past behavior patterns. AI analytics can suggest proactive interventions before potential problems escalate into major issues. AI can also recognize and encourage good behaviors to improve performance.

This kind of real-time, personalized performance evaluation is the future of employee development. It can also help organizations make informed decisions when rightsizing their workforce.

Making Rightsizing Decisions More Objective

The ultimate goal isn’t to replace human judgment with AI algorithms but to augment decision-making with better tools. AI can bring a deeper understanding of the complex dynamics within a team or an organization.

Key Takeaway: 

AI provides valuable insights about worker performance allow you to make informed decisions about the number of employees, their roles, and functions. It’s like having a top-tier coach for your business, helping you develop winning strategies based on a data-driven understanding of each player’s potential.

Harnessing AI for Skills Inventory

Manually creating skills inventories for organizations can be an arduous and error-prone task. AI offers a more efficient, accurate approach to developing comprehensive talent overviews.

Machine learning algorithms can rapidly analyze employee data from sources like resumes, reviews, and training records, extracting each individual’s full range of skills and capabilities. For example, IBM Watson Talent uses natural language processing to parse unstructured text, matching people to optimal roles based on their skill profiles.

In addition to speed and accuracy, AI can provide a nuanced analysis of workforce competencies. By detecting subtle patterns across massive datasets, AI can identify current strengths, gaps versus future needs, and areas that need development in finer detail than humans can achieve.

The result is a dynamic, data-driven skills inventory that empowers strategic workforce planning. Rather than using a static spreadsheet, AI creates a living map of talent capabilities that evolves in real-time with company needs.

Democratizing Access to Skills Information

Using AI-powered skills inventories democratizes access to talent insights across organizations. Employees can update their profiles in a dynamic, centralized database.

This transparency and real-time accuracy encourages cross-departmental collaboration. Teams can quickly become aware of complementary skills in other groups, enabling them to tap into the full range of their organization’s capabilities when tackling projects.

Employees also gain visibility into skills sought by different departments so they can pursue development opportunities accordingly. 

Open access to an accurate skills inventory paves the way for greater organizational innovation, efficiency, and synergy.

Key Takeaway: 

AI reshapes how we build a skills inventory. It analyzes employee data to identify capabilities, enabling detailed skill mapping with greater accuracy and efficiency. With predictive analysis, AI can forecast needs for strategic planning. Plus, cloud-based platforms make skills information accessible company-wide, fostering collaboration and innovation.

Identifying Retraining Potential Using AI

You might identify a need for employee development when optimizing your organization’s structure. AI is a powerful ally, assessing who could benefit most from additional training,  ensuring you keep and cultivate your existing talent, and making smarter use of your resources.

AI also acts as a predictive tool, gauging an employee’s capacity for learning before you commit to their development. It’s akin to a forward-looking analysis, providing insights into the probable success of further training endeavors.

Determining Retraining Needs with Precision

Learning aptitude varies greatly among individuals. Machine learning algorithms can tailor development pathways that play to each employee’s strengths while addressing their weaknesses. By evaluating historical performance, AI predicts who is likely to excel post-training, guaranteeing a higher return on your upskilling investment.

For instance, IBM’s Watson Talent Frameworks offers a granular view of skill deficiencies across teams, aiding leaders in strategic decision-making during organizational restructuring.

Nurturing Talent Over Replacing It 

The greatest assets of any organization are its existing employees whose full potential may yet be undiscovered. By committing to staff development, companies can not only enhance overall morale but also see financial gains from reduced turnover costs.

Amazon’s Upskilling 2025 is a case in point. By investing $700 million in its people, Amazon underscores the value of talent development, effectively converting dormant worker potential into active, high-performance employees.

Making Informed Decisions with Data-backed Insights 

The CEO’s role in rightsizing the organization is pivotal and requires making tough calls. But what if you had reliable data to back your decisions? With AI systems like Microsoft Viva Glint and Eightfold CEOs can make informed choices, helping employees grow while ensuring the company continues to move forward.

Key Takeaway: 

AI is a game-changer in upskilling your team. AI can pinpoint who might need more training, helping you retain key players and use resources wisely. Machine learning algorithms also allow you to craft personalized development paths based on individual strengths and weaknesses. And remember, developing current staff instead of recruiting new employees not only boosts morale but also cuts costs. Take Amazon’s $700 million Upskilling 2025 initiative as an example.

Avoiding Bias Through AI

When it comes to rightsizing, fairness is paramount. However, human decisions can sometimes be clouded by unconscious biases. 

AI technology can examine a great deal of data without being swayed by pre-existing thoughts or personal prejudice. AI evaluates employees based on objective metrics such as performance records, skills proficiency levels, and growth potential.

Algorithms don’t know an employee’s age, gender, or ethnicity unless this information is relevant to their role, so there’s no room for discrimination.

Eliminating Unconscious Bias

Unconscious human biases can negatively influence rightsizing decisions. For example, when managers conduct subjective performance reviews or skills assessments, prejudices about  ethnicity, gender, or age can distort results.

AI systems support evidence-based decision-making. Machine learning algorithms objectively analyze performance data, skills, and capabilities without regard for race, background, or other irrelevant attributes. By focusing solely on metrics tied to job requirements, AI reduces the risk of bias distorting rightsizing decisions.

Enhancing Transparency

AI also brings transparency to rightsizing. AI provides a reason for each decision, whether  it’s retraining, promotion, or offboarding.

Helping organizations stand by their decisions with confidence, and giving clear explanations when needed, builds a solid foundation of trust.

Key Takeaway: 

AI brings fairness and precision to rightsizing by eliminating unconscious biases. AI makes decisions based on objective metrics, not personal prejudices, and makes the process more transparent. AI also helps you understand the reasoning behind each decision, strengthening trust in the organization.

HR Offboarding Process Optimized by AI

The offboarding process, traditionally a manual and emotionally charged procedure, can be made smoother and more humane with the help of artificial intelligence. But how does this work? Let’s break it down.

Personalizing the Offboarding Experience

AI platforms like Leena AI can tailor unique exit experiences for each employee based on their role, tenure, and reasons for leaving. This personal touch helps departing employees feel valued right up until they leave.

Simplifying Administrative Tasks

AI also simplifies offboarding administrative tasks. Platforms such as CakeHR by Sage automate repetitive tasks like asset recovery or final paycheck calculations, making sure no detail falls through the cracks.

Predictive Analytics in Offboarding

AI can also predict potential employee departures by analyzing data from job satisfaction surveys, performance reviews, and other sources. Early identification of employees planning to leave helps companies plan better transitions and reduce disruption caused by sudden exits.

It’s important to note that while technology offers many advantages, it should complement – not replace – human interaction during offboarding. The goal is to make employees feel respected and appreciated so they will leave with positive feelings about your organization.

Future Implications of AI in Organizational Rightsizing

Artificial intelligence promises to shape the future of organizational rightsizing. AI’s capacity to handle immense amounts of information, carry out predictive assessments, and automate tasks will significantly improve decision-making procedures.

As we look ahead, it’s clear that AI will play a larger role in performance evaluation. Algorithms are becoming more sophisticated, identifying patterns and trends from employee data and providing precise assessments that inform decisions about staffing needs. 

In addition to evaluating employee performance, AI’s ability to inventory skills will continue to evolve. AI will help companies not only understand what talent they have on staff but the potential that lies within their teams. By pinpointing underutilized talents or suggesting areas for development, organizations can adapt more efficiently to change.

AI also unlocks bias avoidance. For example, AI-powered platforms like Pymetrics use neuroscience-based games to make impartial assessments. AI ensures fairness and equality by removing unconscious bias from the decision-making process.

Finally, offboarding is an area ripe for AI optimization. Through automation and predictive analysis, you can anticipate smoother transitions that respect departing employees’ dignity while preserving crucial organizational knowledge.

FAQs in Relation to AI for Organizational Rightsizing

How can artificial intelligence improve organizational decision-making?

AI improves decision-making by offering data-driven insights, forecasting trends, and spotting patterns humans might miss. This leads to better-informed choices.

How is AI Changing HR?

AI streamlines HR processes like recruitment and training, transforming the way companies assess talent pools and make rightsizing decisions.

Is HR Being Replaced by AI?

No, but AI complements human efforts in HR. AI can automate repetitive tasks, allowing folks to focus on strategic roles like fostering company culture or enhancing employee experience.

How is AI Used in the Workplace?

AI-powered virtual assistants can enhance communication through chatbots, optimize scheduling efficiency, and assist with data analysis for better business strategies.


The transformation of organizational restructuring has begun, powered by the innovative use of AI in rightsizing strategies. AI’s impact on talent evaluation is groundbreaking, offering a precise analysis of each employee’s capabilities and growth potential. 

This smart technology is reshaping how we perceive and manage our workforce, pinpointing who will benefit most from further training and supporting more robust teams during times of change. Gone are the days of subjective staffing decisions. AI brings objectivity to critical decisions regarding hiring and employee transition. 

The promise of AI heralds a new era with a more sophisticated approach to rightsizing. It’s time to embrace these AI tools and lay the foundation for the future of organizational development.

My name is Glenn Gow. I am a CEO Coach, a Keynote Speaker on AI, and a board member. Let’s explore if we are a fit for each other. Schedule a time to talk with me at I look forward to speaking with you soon.