Hello y'all. Welcome back. So today I had a completely different topic planned out to talk about today. But then when I sat down, I just felt such a deep desire to bring forward a topic that we actually talked about earlier this week in Liberated Leader. So Liberated Leader is my leadership mastermind, and one of the things that we do in there is we have this thing called the Edge Drops.
And this is a private telegram space where I am popping in and sharing my insights, my hot takes around what is happening in the industry, what I'm seeing happening with the future of work. And things that I am testing and experiencing iterating on firsthand so that my leaders can take those and immediately go apply those in their team and really continue to stay at the forefront of what is happening in the industry.
And now if you have opened up the news or been on LinkedIn recently, one of the things that we are seeing a lot about is layoffs happening in. And while there are various reasons to why these companies are stating their laying, laying off individuals, a lot of it is coming down to economic uncertainty and the pressures on the economy and therefore businesses.
And also a lot are accredited to ai and I do think one is actually pressuring the other. As we have so much uncertainty happening in the economy, the desire to create value for less cost is pressuring more companies to try and adopt AI even faster.
And unfortunately, AI has really become this cost savings solution that many executives are looking to pull because at the end of the day, if we put on our CEO hat. People are by far the biggest expense for most companies. And so when you couple that with what is happening with the uncertainty with the economy, that is putting a lot of pressure on companies to find way to, to cut costs and therefore keep their margins.
And so the. The easiest lever for companies to reduce costs fast is to reduce headcount, and that is why there's been such this massive push towards ai. And what's unfortunate about that is it's a really associated AI as this, negative thing that is happening to corporate environments because largely that is how it's being utilized.
And today I really wanna open up the conversation about how do we as leaders start having really real and honest conversations around, the future of our functions, what they're going to look like with the adoption of ai, and how can we make this transition in a positive light. This is not meant to be a conversation of is AI a good thing or a bad thing?
I have a lot of perspectives on both the benefits and the harms of AI on. Teams and also leadership. We can do a whole nother podcast on that. Today what I really wanna talk about is, based off of what's happening with these layoffs, AI is coming and so how can we as leaders be equipped what.
What do, what are the conversations we need to be having? What do we need to be thinking about? Because knowledge is power, and it is much better for us as leaders to proactively be thinking about this, the impact on our functions and how we're adapting, and therefore being able to influence up.
On, where we go from here versus us hiding our heads, pretending AI isn't happening, and letting those up above us make all the decisions for us. Okay, so let's dive into things. So like I mentioned, when it comes to the use of AI today, a lot of companies are currently using it as a cost savings measure.
So whenever companies are thinking about layoffs, what they're really. Looking at is
Yes, profit, but it's much deeper than that. They're looking at how efficient are we at
Welcome to the Liberating Teams podcast. I'm Holly Breeding team psychology practitioner and org effectiveness consultant. Every week around here, we dismantle the outdated hierarchical leadership systems that keeps leaders like you stuck in the weeds and break down how to build a self-managed team that thrives without you at the center.
Because when your team has the clarity systems and ownership, they need to lead themselves. You finally get to lead strategically. It's time to liberate the way you lead.
creating that profit? So are we getting the most value out of every dollar spent on labor, technology, tools, assets, so on and so forth. And if we put on our CEO hat for a minute, what we're looking at is if profit is decreasing, we really have two options as to how to fix that.
We can either sell more drive revenue up, or we can drive costs down. And the easiest, quickest way. Is often going to be driving costs down. And the number one lever to pull in that category is going to be headcount because people across most industries are going to be company's biggest expense.
And so if I let go people, then my prophet suddenly starts to level out. Are there a ton of negative side effects with that? Heck yes. But I just want you guys as leaders to understand that CEO mindset of what they're looking at when they're having to make this decision. And y'all, I cannot stress how critical.
This type of business acumen is not only in leadership should you understand this so well, but your teams, this should be things you're talking about with your team. Everything I just talked about, we talk about In Liberated Leader, we have an entire section on business acumen with a notion board to track all of this as it pertains to your company, because this is so critical.
You should have an understanding of how your business is making money where revenue is coming in, what the costs are associated with that, the different levers keeping a pulse of what's happening in your market because one, not only is that gonna help you create better strategies and have bigger impact, which is what we're gonna talk about here in a minute, but also a lot of leaders come to me and they're like, I'm getting whiplash from the changing priorities and everything going on.
This is going to help you a lot because right now you are waiting for leaders up above you to feed you this information. And a lot of the times they don't like to disclose things until the very last minute because we don't like to create panic in organizations, which I can do a whole nother podcast episode on how backwards that is.
But because of that, we wait till the last minute and then we flip everything on its head. And so if we as leaders have a pulse on this types of business acumen, the things that are driving higher ups decisions, it allows us to be more proactive with our strategies, with the work that we're doing and make better decisions.
So you're not experiencing as much of that whiplash. Okay. Total sidebar. But coming back to it, I really wanted you to understand the mindset of leaders as they're looking through this. So for them, this is the easiest lever to pull. And with the adoption of ai, they're thinking, okay, a lot of those negative side effects of letting go of headcount, but still trying to maintain the same amount of, value and quality and all of that.
Have become a little less scary because we're not just simply running lean and trying to make, a few people do the job of many. Now we have this alternative option of how to potentially replace it for cheaper. So if this is the mindset of what's happening at those higher levels, what do we as leaders need to be thinking about?
The first thing we need to be thinking about is whatever function you lead, whether that be marketing, sales, digital product development, customer relations, whatever function you lead, can you tie your function back to making a specific and tangible impact on the business's bottom line. Can you directly tie the work your team is doing to revenue going up and cost going down?
Here's what has happened in corporations over time, is because of the hierarchical nature that we love in most corporate cultures, how we've designed leadership is, executive leaders, they worry about the business as a whole. And then that next level of leaders is really focused on their function.
And, okay, if this is what is happening with the business as a whole, what do I need to be doing in my function and their cascading goals based off of that? And then the next layer is our management layer. Who is actually overseeing execution? The problem of with this model is exactly what I was talking about before.
It's completely disassociated functions from true business impact. So a lot of the times when I go into teams and I ask them, okay, why does your function exist? What's the purpose of your function? Pull out your purpose statement, your mission statement. A lot of the times I get super fluffy buzzwordy statements of, we're the finance department and we are here to make, ensure that people follow the finance policies and yada.
And I'm like, okay, but to what end? How do you help the business either generate profit or decrease costs and, sorry, generate revenue and decrease costs, and therefore have a direct impact on profit? So because of the very functional nature of how we've been taught to lead, we've really created this massive gap between our teams and profit generation.
And this is one of my favorite things to do when leaders step into Liberated Leader. So when you step into Liberated Leader, you get a detailed onboarding form that lets me know all the ins and outs of your team. And one of the first things that we talk about is just this. What is the unique impact that you have?
On the bottom line. And so many teams struggle with us. So many teams struggle with us, and I get a lot of pushback. I don't really have a direct impact on that, especially with my teams that, are more corporate functions. So like HR or legal or, even like building maintenance and things like that.
They're like, there's no way you can make that connection. And I'm like, bet. Let's go. Yeah, because every single one of the functions that exist within a business exists to serve its ability to make a profit or in, some situations like nonprofits or things like that, a very specific impact on the world.
And every single function and team and role should be able to connect the work they're doing. Back to that. So how does this have to do with ai? The next step is once we understand the impact we exist to make. So say, let's pick on finance today. So I'm finance, the impact I exist to make is I help other departments.
Make better financial decisions so they're able to, decrease costs and keep us keep revenue up. And so if that's my the impact that I exist to make when it comes to ai, the thing that we need to be thinking about is what is the unique differentiator for us? And this goes far beyond ai.
So what we teach in Liberated Leader is that every single function has competitors. Yes, you have competitors even though you are an internal department to a company. So for my teams who are front fa, frontward facing, it's very obvious. 'cause they serve the customer so they understand their competitors are other companies that offer the same thing your company does.
But for my say, finance department, they're like, we don't have competitors. And it's, yes, you do. Your competitors are them going to an external consultancy or an external, boutique to get support. Your competitors is technology or a system or a software. Your competitors are maybe a consultant.
Your competitors are shadow functions. My favorite, people developing their own little mini finance roles within their departments. Those are your competitors and a new competitor that every single one of us needs to be thinking about is ai. So one of the activities that I do with my team since I liberated leader, and I highly recommend you guys do this in the next month or two as you get ready for annual planning is write the impact your team exists to make on a board.
And I want you to assign your team different competitors. So you know, I usually have two people be ai, two people be, the shadow function, two people be like an external firm, so on and so forth. And I say, okay, you guys have five minutes to tell me why we should choose you to provide this impact.
So for finance, our impact was giving that financial advisement that allows people to reduce costs and drive revenue up. So you tell me why we should pick you to do that. And I let them go off. They have five minutes to create their case, and then we go around the room and we do 62nd shark shark tank style pitches.
About why we should choose them. And as they're doing that, I'm writing on sticky notes, some of the key points that they're making. Oh, you're gonna get data faster. Oh, the data's gonna be more accurate. Oh, we're we provide, a unique perspective on what other people in finance are doing at other companies.
Okay. So I'm writing all of those down, and if I'm hearing the same things multiple times, I'm doing multiple sticky notes so I can start to see themes. So this is an incredible tool because immediately within just, a few minutes, you are able to see the risks of your function, right? Where your function could potentially be at risk.
And now here's where people make a huge mistake on this. They panic, oh my gosh, look at all the things that everyone's doing better than us. How can we compete on all these different fronts? That is the biggest mistake you can make. If you are trying to compete with everyone on all of these different fronts.
You are spreading yourself so thin that there is no way you can excel or beat the competition at any one thing. So many of you guys are doing this right now. You are terrified of people, creating shadow functions or using that external consultant. So you are obsessing over trying to do all these things and because of that, you are actually watering down your unique value, the thing that only your team can do.
And so this is the conversation that I'm having with my liberated leaders right now, is just that. Not, how do we compete on all of these different risks? How can we now pause and say to our team, okay, why would you choose us? What do we have that none of these other people have? So like for this finance function, one thing right off the bat is there's nobody who knows you are the inner workings of your company.
Your financial history, what's happening in other departments than you do, right? There's no way that shadow function, they only know their one department. They don't know the bigger picture. Those external consultants, they know, you know what's happening maybe in different companies, but they don't know what's happening within your company.
They don't have the history. The software may be able to produce, shiny, sexy dashboards, but so great. Now they're able to see their numbers, but they could never interpret them. And you, they're not gonna be able to see the things in those numbers that you can. Those are unique differentiators and what I see is people saying things like, we, okay, we wanna be more that strategic advisor.
We know that's a unique differentiator. But then I look at what they're prioritizing and it tells a different story. They're prioritizing the super sexy dashboards. They're prioritizing, developing reports that are super custom and take hours to develop because one person requested them and because they're spending all of these time on these things.
They're losing sight of their unique value and the time that they could spend doubling down on that and continuing to broaden the gap between what only they can do and what none of these other competitors have figured out. And a lot of the times when I press as to why, it's because of fear. If I don't generate this report, they'll have somebody on their team generate it and then it's creating a shadow function.
Who cares? Because that shadow function can never have the unique value that you have unless we don't invest in it. We don't invest in, in this case, the strategic advisement that has the deep business knowledge. And so they're able, like we water it down so much that they're able to actually meet us.
At where we're at, not because we're not capable of more, but because we've spread ourself thin and we haven't doubled down on our unique impact. And when it comes to ai, this is where this conversation's gonna be very difficult for some teams is. For some teams it's gonna be very hard to differentiate the impact, the unique impact that we have, that AI can't.
And it's really easy to fall into a scarcity mindset of, look at what's happening. AI's gonna take over our roles and this really scary conversation, and I don't wanna have this conversation with my team, and it's gonna create panic. But the panic comes from the unknown. The panic comes from the lack of preparedness.
The panic comes from ignoring that this is happening and not having the conversations. Instead, if we start to open up the conversation and say, Hey, we know this is coming. Let's start to talk about it. Let's start to talk about what we're going to do about it. Hey, the differentiation between the work that we're doing and what AI can do.
It isn't that big right now. So what can we do to stretch that gap? Where can we really hone our unique differentiator where it becomes, something that. Is so unique to us that only we can do, and for some of us that's gonna have to, we're gonna have to really rethink fundamentally how our functions have operated for many years.
And while that's scary in some ways, it's also really exciting about, thinking of where are there things that we've always wanted to do more of. We've always wanted to develop the skill, we've always wanted to offer this capability, we've been so entrenched in these other tasks that we've never had that possibility.
So approaching this through that lens of how can we be better serving our clients? How, what could we be doing more of? What are, skill sets that we could be really honing and doubling down on? And instead of, trying to, again, outbeat AI or those competitors. Instead, how can we double down and focus on that?
And for a lot of us, it's going to be broadening our our work beyond typical of what's work typically of what work is around today, which is ex executing. So a lot of work today is executing on standard operating procedures, executing against certain policies and procedures, and.
A lot of us are going to be pushed and shift the expectation from execution to more of that thought leadership, strategic advisement, innovation, creativity, complex problem solving. And so as leaders, we need to be thinking about, okay, where, how can we spread this differentiator out? How can we create more of a gap?
Between the unique value we provide and our competitors, and what do we need to be thinking about as we go into 2026 to start to act on that gap. Maybe it looks like shifting capabilities and focuses. Maybe it looks like upskilling or reskilling. And hear me when I say this isn't something that's going to happen overnight.
This is a process. But it's something that you are going to start seeing is people really starting to rethink what traditionally these functions have always looked like, how hr, sales, marketing, product design, all of these functions have looked like and starting to reimagine what they look like with ai.
And so those are the conversations we need to be having as well, because if we start now. We have time, like I said at the beginning, to reimagine, to influence the direction, to upskill, to reskill versus leaders. Pulling these blunt levers of cutting headcount. So now that we understand the impact part of things about how do we stretch the impact the gap between the impact that we're having that is unique compared to our competitors, the next thing we need to talk about is that cost side of the equation, right?
Because they like to see us having a direct impact on the bottom line, but they also wanna know that the cost of that impact is efficient. So are we getting. The most value out of every dollar spent on labor assets, technology, so on and so forth. And I think in a lot of ways, we as leaders get disconnected from this because again, we're so stuck in that functional mindset of I need to deliver on these HR policies and these new, the latest trendiest things that we're talking about in HR and everyone's doing these things and so we need to have a program around this and we don't even truly associate what is the bottom line impact we are having on the business and the cost that it is taking for us to do all of this work.
And I think that's a really tough pill to swallow is. Is the cost worth the impact? And it's something that a lot of us as leaders don't have to face until we're in situations of, tight times. And even then we don't get a lot of time to think through that. And. I really, something that stuck with me was Spotify when they did their layoffs, oh gosh, time, I don't know, two, two years ago, was it?
Two years ago? They released a letter explaining everything and one of the things that stuck with me was essentially this is, we've had a really good year a high productivity year, but we've also become significantly inefficient. And the productivity that we have experienced when compared with the efficiency, it doesn't add up.
And they pointed to, a lot of distractions and people doing work around the work, people doing work around the work. And I think this is so critical. Because this is where a lot of us have fallen into is we become disassociated with the bottom line business impact and we end up generating work projects.
Initiatives that may be valuable to our function may be keeping us up with the trends. The benchmarks may be something that some executive over here asked for, but can we directly think about. Business impact versus cost associated with delivering it. And I think as we see the rise in adoption of ai, the focus on efficiency is going to really start to deepen, and I don't say efficiency in the sense of like headcount exercises.
I'm saying efficiency in yes, labor, but also systems, tools, vendors and the amount of time, energy, capacity, friction that goes into creating this. How many touch points, how many different people involved. All of that is cost. And what I actually like to talk about at Inside Liberated Leader is the concept of org debt.
Is that a lot of times over the years. We as functions develop org debt, and this is years and years of built up processes that have become super complex and inundated and, procedures we put in place or sign-offs we put in place because somebody four years ago, spent too much money on the corporate card.
And so now we need to put in like a seven step process to prevent it from happening again. But really it's just causing even more of a negative impact and a drain on the team where it matters the most. There's a lot of role clarity issues that become massive org debt. We've had people in these roles for years and they've just tacked on responsibilities.
It's gotten very murky. There's not a lot of true clarity around who owns what, who has what decision rights, how teams operate. Even like things like SOPs. We have an SOP for everything that has taken out all of the. Autonomy and the opportunity to be agile and, quicker and adapt can be, or debt.
And while these things you, it's gonna be harder to tie to the financial implications like headcount, like the cost of technology they are in my opinion, can be even more costly. Because if you just think about, take for example, meetings and the amount of like unproductive meetings we have, talking about work and not doing any work, there's massive cost associations with that is the amount of, any meeting just sit there and add up rough estimate of the average salaries times how many people are in the room.
How much time you're spending in that meeting, 60 minutes. How much time went into prepping for it? How much time is spent after the meeting? Debriefing, what was said in the meeting, all of that, the, and then also add the associated costs of distracting people from doing the work that they were supposed to be doing during that time.
And that's a massive cost on our efficiency in creating that impact. And so once we've gone through the process of really honing in on what is our unique impact that only we can provide the next thing we need to be thinking about, what is the cost associated with that and how can we make it more efficient to delivering that impact?
And this is again, another area where AI could potentially come in and be a benefit to us. Where are there ways that we can leverage AI to reduce the cost, whether that be financial or debt associated with creating our unique impact. And therefore it's allowing us to create more value for the company by using AI as a partner.
So I think this is another critical lens that leaders need to be taking as we're thinking about planning season ahead. Now I do briefly wanna talk about headcount because obviously this is the biggest thing that a lot of people are feeling right now. And here's the thing, there is it's ugly.
I'm just gonna say it. It's ugly. It's, it, there's nothing, joyful about thinking about having a negative impact on someone's job and their livelihood, but I would much rather. Be starting to have the conversations now when there's opportunities for reskilling, upskilling, shifting roles, things like that, versus when it's gotten to the point of, where it has been right now with broad layoffs.
And I think this goes beyond just ai. I know a lot of us as leaders, as team members can think about times where we've been on a team where maybe it's happening in your team right now, where there is a role that has been there around for years where it's just it's not bad work, but it's just not, super valuable work.
Or even worse, what we see happen a lot is, somebody who's not succeeding in a role. I see this a lot at higher leadership levels as well. A director or a VP who's not succeeding in that role. So what do we do? We pull 'em out and we play, pop them in this super ambiguous role senior advisor or consultant or whatever it is, and we give them super vague business responsibilities.
That's essentially says go over there, sit in this corner and we're gonna give someone else this job instead of doing the human thing, which is having the conversation. Having the conversation, and I mean that, that's there, those are two different situations. And that one's like a talent situation and one's a it's not talent, it's just simply the work is no longer value based off of where the business is going.
And I think in. The latter. There's so much that can be given in the sense of having the conversation of your work is, has gotten us to where we are today, and we are so deeply grateful for that. And as we continue to evolve, we wanna talk about how we can utilize your skillset in a different way away.
And like I said, there's no. There's no beating around the bush that these are tough conversations to have, but it is my belief that it's our responsibility as leaders to not avoid these things to where, it gets taken, quote unquote, taken care of down the road, but actually do the right thing.
Have the conversations, notice these things. At the point where we have the opportunity to rescale upscale shift to a different seat on the bus. Because not only is that what's best for the rest of your team, but it's also what's best for that individual in the long term, even if it requires short term discomfort right now.
So the last thing that I wanted to talk about wrapping up this discussion is as we've. We've talked through this about shifting the impact of our functions, even shifting the role of the individuals of our team from execution to more strategist thought leader, innovator, creative thinker, and also thinking about how we can be, optimizing our delivery of impact.
I think it's really critical that we talk about the role of the leader is also going to fundamentally shift as we experience ai. A lot of leadership roles today, regardless of if you're middle management or even higher level leaders, has become around managing execution of developing a thing, an output, delivering a service.
And we've already start to started to see a shift there of where traditional management is no longer working. As we're starting to move into just the sheer overwhelm, the amount of responsibility of constant demands and changes and everything going on in leadership today in the world we live in, we've seen this push to how do we develop these more.
Independent teams, these more quote unquote empowered teams that allow us as leaders to get out of the weeds. I think that's just phase one of what we're about to see. I think it's going to go so much further in that leadership's not just going to be about, empowering, I'm putting that in quotes, your team so you can get out of the weeds.
It's going to be about taking it to the next level and saying, how can we actually create teams environments that allow these skill sets strategic thinking, complex problem solving, creativity, innovation to thrive. And that is going to be a fundamental shift in how we lead, how we operate our teams, how we measure performance.
And I think leaders who have really struggled with wanting, control and rigor around everyone. We have these standard SOPs and we do these status updates and everything's very black and white and measurable and things like that. They're going to have a hard time because that type of environment is not the type of environment that, allows creativity and innovation and thought leadership to thrive.
The leaders who are going to excel are the leaders who aren't, really good micromanagers, who you know, can force the execution of things. It's the leaders who have this unique ability to take any team and be able to draw out that thought leadership, that creativity, that innovation to create these cultures, these ways of working that allow teams to thrive in this way, to test and iterate and learn and, build off of each other's ideas that don't, required top-down management, but is very much this, co-leadership, collective intelligence type environment. Because here's the thing, when we have ai, we have a very simple means of execution, but the ability to create these ecosystems of thought leadership and innovation, creativity, that is a rarity.
And so the leaders who are able to create that and tap into that is going to be such an incredibly coveted skillset. And that's why in Liberated Leader, that is our focus. We have a full section on that self-managed autonomous team, which is a lot of people right now are touting, empowerment.
But it's just a lip service thing, or team's empowered. You can't have an empowered team if you don't change the way you actually operate to empower them. You can't have an empowered team if you drop them in a system that's designed on old school command and control, hierarchical leadership, where it's like you are empowered.
You just have to get 73 sign-offs on that idea you just came up with before you can take it forward. That's not empowerment. That's paying lip surface to empowerment. You are empowered to make that decision, but is probably gonna get overwritten by the leader up above us. That's not empowerment.
And so a big piece of the autonomous teams curriculum is about how to create a truly empowered environment where. Teams are able to be those thought leaders, those innovators, to draw out that strategic thinking, and then we take it one step further, which is in every section that I teach, it's all about co-creation and doing it with your team strategy that's about co-creation and doing it with your team, innovation, co-creation, and doing it with your team because that's exactly the skill sets we're going to need as we move into the future of work.
So if you are interested on furthering the conversation of how to futureproof your team.
Based off of what we talked about today or how to create that truly autonomous empowered team, liberated leader is exactly where you need to be. You can click the link below for more information or always just send me a DM over on Instagram.
I'd love to voice memo back and forth with you about what's going on with your team and if liberated leader is a good fit for you. Okay guys, take something you learned in today's podcast. Go test it out in your team and let me know how it goes. Let's go do some work
