Why Calling AI A “Digital Workforce” Misleads Leaders with Phil Wainwright

Forget the headlines predicting a “workerless workforce.” In this episode, host Bill Banham sits down with longtime cloud and SaaS analyst Phil Wainwright to cut through the hype and examine what AI agents really mean for HR, business leaders, and the people doing the work.

Phil argues that automation can be transformative—but calling software a “workforce” conceals the real challenges organisations face: governance, transparency, accountability, and change management. Together, we explore where AI agents will take hold first—help desks, admin-heavy workflows, repetitive processes—and why this shift places HR in a more strategic, cross-functional role.

Listeners will get practical guidance on:

• How to encode policy, ethics, and organisational values into systems so AI operates safely
• Specific risks in AI-driven recruiting and performance processes, from hidden bias to opaque decision paths
• The documentation, access rules, and audit trails needed to build trust
• How skills-based talent frameworks are reshaping hiring, development, and mobility
• Why adaptability, empathy, creativity, and problem solving are emerging as the defining skills of modern work

We also dig into early-career disruption, the evolution of knowledge work, and the rise of modular teams blending AI, contractors, and full-time staff—without dumping everyone into the gig economy.

If you’re leading HR or building teams, this episode offers a grounded roadmap for responsible AI adoption and resilient workforce design.

Chapters

• 0:00 Welcome And Guest Reintroduction
• 2:20 The “Digital Workforce” Myth
• 4:00 How AI Changes HR’s Role
• 7:10 Adaptability And The Future Of Work
• 10:30 Trust, Ethics, And Policy For AI
• 13:20 Skills-Based Talent And Continuous Development

Transcript

SPEAKER_00: 0:02

Welcome to the HR Chat Show, one of the world's most downloaded and shared podcasts designed for HR pros, talent execs, tech enthusiasts, and business leaders. For hundreds more episodes and what's new in the world of work, subscribe to the show, follow us on social media, and visit hrgazette.com.

SPEAKER_02: 0:26

Welcome to another episode of the HR Chat Show. Hello, listeners. This is your host today, Bill Bannham. And joining me back on the show after we were just looking at this nearly five years is the awesome, wonderful, fabulous, fantastic Phil Wainwright. Phil has charted the rise of cloud computing and its impact on business for more than a quarter of a century. He's an entrepreneur, he's a writer, and a noted industry analyst. He launched his online venture to chronicle the early years of the SaaS industry back in the late 1990s. And in 2013, he co-founded the tech media website Digonomica to cover the evolution of digital technology and how it's changing the enterprise fill after way, way, way too long. Welcome back to the show.

SPEAKER_01: 1:15

Well, thanks very much for having me, Bill. It's great to be back. And it has been a hell of a long time, hasn't it?

SPEAKER_02: 1:21

It certainly has, but you don't look a day older, sir, I've got to say. Thanks, Bill. You're such a flatterer. Well, absolutely, it's 100% true. Um, as we always do on this show, Phil, uh, why don't you start by just taking a minute or two and reintroducing yourself to our audience?

SPEAKER_01: 1:41

My big focus is how technology is changing the way that businesses operate. Um, and therefore I spend a lot of time talking to uh people, CIOs, uh CHROs, other people leading businesses about how they're making use of the technology to make a big impact. Um, and um and I spend a lot of time obviously talking to vendors as well, who always seem to be talking about AI these days, um which we might come on to in a moment. But uh that uh uh that focus is something that I've had for, as you mentioned, you know, a very long time, right from the birth of SaaS up to where we are now with the industry.

SPEAKER_02: 2:20

You criticized vendors for talking about AI agents as a new form of digital labour and a digital workforce. Why is that? Give us the historical context.

SPEAKER_01: 2:31

What has been happening, we've been hearing from vendors like I mean, Salesforce and Workday, for example, have been coming out and saying, you know, with these new AI agents, uh you've got a digital workforce and you need to start planning for managing that. And I I I I really hate the the way that they're using that language for two reasons. I think, first of all, um it's it it encourages lazy thinking. You know, we never talked about when ATMs came came out or self-service checkouts, we didn't talk about that them as part of the workforce, and we shouldn't do the same for AI agents. I mean, it's it's not um it is automation, it's a new kind of automation, it's going to be very powerful. But but at the end of the day, people and corporations are still responsible for it, and the people will have to manage these uh the these these these machines. And the second reason is that there's a bit of a sinister subtext here. You know, it's a bit of the, I jokingly call it the workerless workforce. You know, they're basically saying have our software and you won't have to spend so much on your wage bill. Uh, and you know, I I I don't think that's a very healthy way of looking at this either.

SPEAKER_02: 3:42

So as enterprises continue to deploy AI agents, Phil, how do you think that'll change the way that HR teams manage the workforce?

SPEAKER_01: 3:51

Big change is coming, obviously. This this this is a huge change in terms of what the technology can do. Um, I think we are gonna see the more routine work like help desk or all the admin stuff becoming much more automated than it has been in the past. Uh, and that means that uh HR people are going to hopefully become more strategic. Um, they're gonna have to do more liaison with other functions in the business. I think that trend's already been happening, it's going to intensify. Uh and of course, they're also going to have to be monitoring what's going on with these automations and making sure that you know, if you're automating talent acquisition, for example, you you've not got hidden bias built into how the agents are operating. I do think some roles will change as well. Um, the HR is going to be working much more closely, even more closely, in fact, with with IT in setting the guardrails around these agents. Uh, you know, in the past, HR people have have set the guardrails for commission for permissions, for example. You know, people's roles are in the HR system that gets imported into the identity management system. Um, but I think things like policy and ethics and values are also going to have to be defined so that the machines can take that on board. Um, but the main role is still going to be managing the human workforce, and there's going to be a huge amount of work there helping those people adapt to all of the change that they're facing in their roles.

SPEAKER_02: 5:21

So, what what are we looking at in terms of a change in the labour force? So I've read, for example, uh by 2030, 330% of jobs that exist today will be entirely automated, they'll be entirely replaced by um by AI and large language models. What does that mean in terms of uh uh the opportunity to to get jobs, the opportunities to grow with it within a career within a company? But what what are your what are your thoughts?

SPEAKER_01: 5:49

Um yeah, I mean I think it's very difficult. I was talking to someone the other day who who's talking to his kids as they're coming into the workforce and they're thinking, well, if I start a career now, would it still exist in 10 or 15 years' time? And I and I think that that kind of gets to the nub of the issue here is that one of the things in the future is that people will have to be very much more adaptable because their jobs will change. But I don't think that's a new thing that's just happened because of AI agents in the past couple of years. I mean, people were talking like five, 10 years ago, about how um you needed to be able to adapt throughout your working life. That going to a university and getting a degree and then a professional qualification and you were set for life, that doesn't happen anymore. And I don't think it's it's been true this century. Um so uh so so really what the AI wave is doing is just intensifying this process that was already going on. And I think one of the big things is that this whole field that we know as as knowledge work is really the area that's going to change dramatically. Um and and again, this is something I've I've written about in the past. I think there's going to be much more emphasis on uh people who are good at what I would call real-time skills. So this this the um this ability to use empathy, this ability to be adaptable, this ability to innovate uh and be creative. I think those are the skills that will be emphasized. And and a lot of knowledge work will still exist, but it'll be people who are able to deal with knowledge as it changes rather than people who've come into the workforce knowing something, and that's what creates their career for their lifetime.

SPEAKER_02: 7:34

Phil, how can HR leaders evaluate the ethical implications of deploying AI agents in ways that maintain trust and show transparency to employees?

SPEAKER_01: 7:47

Yeah, I I mean I think that's a big challenge at the moment because the space is still evolving. I mean, every vendor that you you meet is going to talk about a trust layer that their AI systems have built in. It's gonna talk about ethical AI. Um I I think everyone knows that they need to uh they need to cater to this. Um, but I think the mechanisms for doing that are still um are still being evolved. And I think one of the one of the key things here is that with AI, it it only knows what it what it knows. Uh so you know with a human, they come into the workforce and they know they they already know, you know, this is an extreme example, but they know not to kill people. You know, whereas whereas an AI agent does not know that until unless it's actually been briefed in its values. Um, and and so it means that you've got to be much more careful if you're actually using policy to um that the AI agents are ingesting to decide what actions are acceptable and what actions are not. You've got to make sure that that policy is is really well written down, and in a lot of organizations it hasn't been because the people have filled in the gaps in the past, and so I think that's one of the big risks for organizations going forward is that they're actually going to have to document their policies and values and their ethics much more carefully.

SPEAKER_02: 9:16

But fortunately, there are plenty of GPTs that can help you with that.

SPEAKER_01: 9:21

Yeah, yeah, don't get me started.

SPEAKER_02: 9:26

Um with automation for removing many friction points. How should HR rethink skills development and workforce planning then to stay ahead of uh of shifting business needs? What what what are the things they should be doing right now to strategize as we see that percentage of folks being getting higher in terms of being replaced by AI? Um, how the the the ratio of uh human work to uh augmented work is is shifting as well. What's the role of the HR leader there to make sure that the organization is, I guess, future-proofed?

SPEAKER_01: 10:01

Yeah, I think one of the most important things, and a lot of organizations, again, are already doing this, is moving to a skills-based talent management framework so that you're not just doing it on what people are qualified to do, but you're doing it on their actual proven skills. And a lot of those skills are going to be soft skills that are going to be important. And so having the taxonomy and the systems for capturing that is really important. I think also you've got to give people much more agency, employees, much more agency in forging their own careers. You know, if you expect them to be constantly adapting uh what they know, constantly adapting to new skills, you've you've got to put them in charge of that. You you can't kind of direct them everywhere, you've you've got to allow them to do that. So I think uh so I think those are two very, very important steps that organizations need to take. Um, and I I think the other part of this is that this is all about moving away from historically paper-based systems to much more digitally connected systems, and so you're able to do much more in real time. So things like talent development, things like um uh uh recognizing employees is something that you don't do once or twice a year, you you're doing continuously all the time.

SPEAKER_02: 11:21

So there is a concern with um more junior folks, new folks coming into the labor market, but um, the roles that they would have moved into just a few years ago aren't going to be there because they've been replaced. You mentioned uh uh were you focusing on on knowledge workers? So, for example, um legal professionals, junior legal professionals. It looks like their jobs are pretty much replaced, but yeah, the senior guys have still got a job at the moment. So these folks have got to find new ways to make money. Um, and it seems like there's uh uh a big opportunity here with all the new wonderful technologies at our disposal, and we don't even need coding uh knowledge anymore to create businesses. What opportunities, Phil, uh, does AI open up to the gig economy, to gig workers?

SPEAKER_01: 12:07

I think you've asked me two questions there, really, because you've you've asked me about kind of people coming into the workforce, but you also asked me about gig workers. I I think um I think there's gonna be a lot of opportunity for gig workers um because I think organizations are gonna uh look for skills in a much more um kind of componentized way, because it's gonna be possible to like get things done by assembling different bits of input, um whether it's machines or whether it's um uh gig work or or or permanent employees. Um so so there's that element. Um but but I I I think that um I don't think everyone's gonna end up in the future just doing gig work. I think people are still gonna be able to forge careers, and I think that still involves developing a specialism. Um uh that it's just that that specialism is going to be based on experience and and getting to know how uh a particular sector works rather than uh uh rather than specific knowledge. Um and I and I think that uh that a lot of this is very difficult because it's still working itself out. Uh it's one of the areas where you know legal profession, business consulting, you know, that they've the practices there have depended on people coming in working long hours on low salaries in order to get to a point where they can become partners. Um, and and that whole channel now starts to disappear because of the the way that knowledge work is changing. So I don't know how those organizations can adapt to that yet. So there is a lot of change in the air.

SPEAKER_02: 13:48

So I'm taking from that, I'm not sure, Bill, which is what I hear quite a lot. Everybody's still trying to figure this out.

SPEAKER_01: 13:55

Well, you know, I think that some of these things um no one knows. If someone tells you that they know, it's then um then they're making it up. Uh and and uh and I think that makes it very difficult, but humans are very good at adapting to change. And in fact, it's one of the things that distinguishes us from AI, which can only work with stuff that it's being fed. Um, so so you know, people deal really well with with um uh with with with with black sheep, uh black swan moments, um, and um as well as black sheep moments. Uh and I think that uh uh that that constant um uh ability to reinvent ourselves is gonna stand us in good stage, uh good stead in the AI age.

SPEAKER_02: 14:41

I think that's a lovely place to wrap up this interview. That just leaves me to say for today for Wayne Wright. Thank you very much for returning to the HR Chat Show. Thank you very much, Bill. I've really enjoyed it. Thank you. And listeners, as always, until next time, happy working.

SPEAKER_00: 14:59

Thanks for listening to the HR Chat Show. If you enjoyed this episode, why not subscribe and listen to some of the hundreds of episodes published by HR Gazette? And remember, for what's new in the world of work, subscribe to the show, follow us on social media, and visit hrgazette.com.