In 2025, external forces are already reshaping the workplace—impacting everything from hiring strategies to the perks and benefits employers can realistically offer.

With ongoing economic pressures, many employees are feeling the strain on their paychecks. At the same time, organizations face tight financial constraints, limiting their ability to offer raises or monetary incentives as they focus on staying financially stable.
 

Adding to this complexity is the widespread pullback on diversity, equity, and inclusion (DEI) initiatives, driven by shifting political discourse and cultural polarization.

As a result, we’re likely to see a more agile and flexible approach to employee benefits this year. The example above underscores how quickly external events can derail even the most well-planned perks strategies. And in today’s unpredictable market, it’s not a question of if the next curveball will come—but when.

To truly drive engagement in 2025, HR leaders must embrace strategies that are flexible, responsive, and future-ready. The most effective approaches will be those that evolve with employees' changing needs, proactively address pressure points, and align with the shifting landscape of work.

At the same time, the ripple effects of disruptive technologies like AI are being felt across nearly every function—but few feel the impact more acutely than IT service teams, who are bearing the brunt of this transformation.

How GenAI Is Making Pyramid Hierarchies Obsolete

Ai is in particular having a unique impact on IT and services departments.

The rise of GenAI has already transformed everyday tasks—from drafting emails to summarizing meeting notes—into faster, smarter processes. But its impact goes far deeper in IT operations.

According to Dr. Ranjit Tinaikar, CEO of global digital transformation firm Ness Digital Engineering, the shift has been especially profound in tech teams. A recent study by Ness revealed how popular coding assistants are not only streamlining workflows but also reshaping team dynamics in real time.

“Our research on nearly hundreds of software engineers globally and across multiple geographies, industries and technical environments revealed that GenAI software engineering tools (like CodeWhisperer and MS Co-Pilot) have a significant impact on the productivity of software engineers,” he explained.

Now, GenAI can be used to automate a range of development activities and the uptake has already been significant across the board. It was recently revealed that 30% of Microsoft’s code is already produced by AI while 150 million developers now use GitHub Copilot.

However, it's important to recognize that GenAI is doing much more than just boosting productivity. According to Dr. Tinaikar, HR leaders can expect to change the very fabric of IT project delivery due to the disproportionate impact that technology was found to have on senior versus junior team members.

“We found that while these tools improve productivity for both senior and junior engineers, the productivity gains were nearly twice for senior software engineers. In other words, this could radically reduce the proportion of junior engineers needed to deliver projects, which would have a material impact on recruiting and HR.”

“As senior engineers aided by the power of Gen AI could get the job done with far fewer junior engineers, the pyramid team structure could evolve into a diamond structure where there are more senior software engineers than junior software engineers on the team.”

This research shows that HR may need to adjust IT service structures from a pyramid to a diamond structure in 2025.

“Instead of relying on the pyramid, successful HR departments would rely a lot more on large investments in upskilling talent and prioritizing talent pools that are leveraging cutting-edge technology.”

In turn, GenAI is going to change how talent acquisition and development programs run.

Tackling a Looming Skills Shortage in IT

While AI brings valuable support to many areas of HR, it also introduces new challenges—especially in talent acquisition. As the demand for tech talent rises, the growing skills gap is making it increasingly difficult to recruit and retain qualified professionals across the board.

Jatin Solanki, Co-Founder of Decube, offered further perspective on the potential for a looming HR crisis in 2025 due to a shortage of IT talent on the labor market.

“The IT skill gap represents the disparity between the skills employers need and what the workforce can offer. This gap spans various technology areas, including cybersecurity, data analytics, and cloud computing.

Here, Solanki advises that identifying these shortcomings through an effective IT skill gap analysis can guide educational institutions and training programs to align their offerings with industry demands.

“Examining the current IT workforce reveals critical gaps. For instance, skills in AI, machine learning, blockchain, and cybersecurity are notably scarce. Both large tech firms and startups face challenges in finding qualified candidates, leading to project delays and reduced innovation,” he concluded.

Breaking Down the Legacy Knowledge Barrier in IT

Although leaders understand the need to modernize IT infrastructures and digital architectures, the migration to modern systems isn’t always straightforward. Dr. Tinaikar also explained that many enterprise organizations still have a major tech debt that comes from legacy IT infrastructures.

Large enterprises that were early adopters of computing technology now find that elements of their IT systems were built using coding languages that are no longer in use, leading to huge delays in migration.

“These legacy platforms are often mission-critical operational systems that have been used for several decades, and migrating them seamlessly to a new technology was considered a herculean risk. AI has fundamentally altered the barriers to knowledge and training.”

“AI has the potential to modernize enterprises trapped in legacy IT environments. Many major enterprises have avoided the operational risk of migrating from these legacy platforms as the developers who designed and built them have retired or are in short supply.”

Harnessing AI in Unexpected Ways

HR leaders can harness the power of GenAI to tackle a major operational roadblock and offer IT teams with valuable upskilling and development opportunities.

Author Bio

Conrad Egusa is the CEO at Publicize and CEO at Espacio Media Incubator. He is a Global Mentor at 500 Startups, Founder Institute, Techstars, Cardinal Ventures of Stanford University, Oxford Entrepreneurs and more.

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