Macmillan Meets…Sergio Fasce: The Future of HR: Business Impact, AI, and Organisational Transformation

The Future of HR: Business Impact, AI, and Organisational Transformation

Macmillan Meets… Sergio Fasce, senior HR executive and former CEO with extensive international experience at the intersection of business transformation, operating model, and workforce strategy.

Most recently Senior Vice President HR at Nokia, he led a global HR organisation supporting 84,000 employees across 125 countries, working directly with the CEO and Board on transformation, executive talent, and workforce strategy.

Earlier in his career, Sergio also held CEO and general management roles with full P&L responsibility, including serving as Chairman and CEO of Alcatel-Lucent Italy.

He is particularly interested in how leadership, operating models, technology, and workforce capability are evolving in increasingly complex and AI-driven business environments.

An In-Depth Conversation with Sergio Fasce

In an era defined by artificial intelligence, geopolitical uncertainty, and unprecedented organisational change, the role of HR is being fundamentally reimagined. Sergio Fasce, a seasoned HR executive with deep P&L experience, shares his perspective on what separates strategic HR from administrative HR, and why this moment represents the profession's greatest opportunity.

This conversation explores the intersection of business performance, operating models, AI-driven transformation, and the evolution of leadership in 2026 and beyond.

Beyond Process: Connecting HR to Business Outcomes

You've led HR with a P&L mindset. What do most HR leaders still misunderstand about driving business performance?

Many HR leaders still approach business performance too indirectly. There's often a strong focus on culture, behaviours, and processes, and while these matter, they're not enough.

What truly drives business performance is the ability to connect four critical elements: business strategy, operating model, leadership, and workforce capability. These must work together as a system.

The challenge is that many companies still treat these dimensions separately:

• Strategy is discussed at the top
• Operating models evolve organically
• Technology is implemented independently
• Workforce and leadership are managed in parallel

But in reality, competitive advantage increasingly comes from how well these elements are integrated and executed together.

This is where HR can create disproportionate value, not only by managing talent, but by helping the organization align execution, leadership, capabilities and organizational adaptability around business priorities.

Too often, HR leaders think primarily about how to run HR well, optimising processes, implementing best practices, executing programmes. But the real question should be: how can I impact the business outcome of the company through HR?

That requires moving beyond functional excellence to develop a deep understanding of the business itself. You need to know your customers, your competitive position, where value is created, and where the gaps are. Only then can you design people strategies that close those gaps and unlock opportunity.

Operating Models in the Age of Clarity

How should companies be rethinking their operating models right now, and what role should HR play in that?

We're in a transformative moment. The introduction of AI, combined with a highly dynamic geopolitical and economic environment, means everything is moving faster than before.

In this context, companies need operating models that are clearer and more explicit.

Here's the issue: many organizations work today because humans compensate for structural gaps. They negotiate, escalate, adapt, fix issues on the fly, and use tacit knowledge to keep the system running.

On paper, processes, governance and decision rights often look clear. In reality, organizations frequently rely on informal coordination and human flexibility.

But as speed increases and AI become embedded into workflows and decisions, that informal flexibility will not scale anymore.

AI forces organizations to become much more explicit:

• Who decides
• Based on what information
• With which guardrails
• With what escalation logic when something goes wrong

This is why I believe AI will reveal the real organization and the real operating model of companies.

Clarity will become essential, especially around decision architecture. Who makes which decisions? What are the escalation paths? Where do overlaps exist?

This is where HR can play a major role: driving and orchestrating the organisational changes needed to support this new environment. It's not just about talent, it's about designing the architecture of how the company operates.

AI and the Real Work of Transformation

How do you see AI fundamentally changing workforce strategy, not just jobs, but how organisations are built?

There's a lot of discussion about AI's impact on tools and people. What I don't see enough of yet is focus on how AI will change organisational design and operating models.

AI will reveal the real operating model of a company, the hidden overlaps in decision-making, the exceptions, and the workarounds that people use to make things work. With AI, all of this needs to be made explicit.

Without addressing the organisational and operating model layer, companies won't be able to fully leverage AI. You can't just bolt AI onto a broken structure and expect transformation.

Another important shift is that AI introduces probabilistic execution into environments historically designed around deterministic logic.

Traditional enterprise systems were built around predictable outputs and visible process flows. AI-enabled systems behave differently: outcomes can vary, execution becomes less transparent, and exceptions become harder to anticipate.

This changes the role of leadership significantly. The question is no longer only performance or productivity. It becomes:

• What level of enterprise risk is acceptable
• Where human intervention is required
• How escalation and fallback mechanisms should work
• How to build resilient control loops around increasingly autonomous systems

At the same time, workforce competencies must evolve. The traditional approach to upskilling and reskilling is too slow for the current pace of change.

The future is learning in the flow of work, where people continuously build capability while doing their jobs, rather than through separate training programmes. Speed will be the defining competitive advantage in this transformation.

The Paradox of AI Expectations

Do you think most organisations are underestimating or overestimating the impact of AI on people and performance?

Both.

Many organisations are overestimating the positive impact of AI in the short term. They expect immediate productivity gains, cost savings, and efficiency improvements. Some of that will happen, but not as quickly or as easily as anticipated.

At the same time, they're underestimating the enormous people and organisational change required to support AI adoption. This isn't a technology implementation, it's a fundamental transformation of how work gets done.

What many organizations are underestimating is the amount of organizational debt accumulated over years:

• Unclear decision ownership
• Overlapping responsibilities
• Slow escalation paths
• Fragmented workflows
• Excessive dependency on tacit knowledge

These structures were often manageable in slower environments because experienced people compensated for them continuously.

But AI dramatically increases execution speed expectations.

This creates an asymmetry:

AI-native organizations are designing workflows, decision-making and execution models from scratch around speed and automation, while many established companies are trying to layer AI on top of structures originally designed for a very different era.

Companies are still figuring out how to balance these two realities. The risk is in the midterm: if organisations don't make the necessary changes to structure, capability, and culture, they won't capture the value AI promises.

Leadership Reimagined

What does good leadership look like in 2026 compared to five or ten years ago? Has it changed that much?

Yes, it's changed significantly.

Good leaders in 2026, and beyond, are those who can provide clarity in a highly uncertain and fast-changing environment.

It's no longer about having all the answers or relying on experience and hierarchy to move forward. Instead, it's about the ability to make difficult decisions with incomplete information, without breaking trust or psychological safety.

Leadership today requires a combination of empathy and decisiveness. You need to bring people along with you, even when the path isn't fully clear.

At the same time, psychological safety will become increasingly critical.

The pace of technological and organizational change is becoming unprecedented. People are being asked to continuously adapt while many traditional assumptions about work and careers are changing simultaneously.

If organizations do not create sufficient trust, transparency and psychological safety, resistance to transformation will increase significantly, even when the strategic direction is correct.

In this environment, leadership is not only about driving speed and execution. It is also about creating the conditions where people feel able to adapt, contribute and evolve without fear of becoming irrelevant.

At the same time, leaders will increasingly need to operate in environments where knowledge is distributed much more broadly across the organization.

AI accelerates the speed of change and the complexity of decisions to a level where traditional hierarchical decision-making becomes too slow.

For years companies have talked about moving decisions closer to where knowledge sits. AI will force this to happen much more aggressively.

The role of leadership will evolve from controlling decisions to orchestrating execution, defining guardrails, and enabling fast alignment across humans and increasingly autonomous systems.

This is a meaningful shift from the past, where authority and experience were often enough. Now, emotional intelligence, communication, and the ability to navigate ambiguity are the differentiating capabilities.

Earning Relevance at the Top Table

If some HR leaders still struggle to earn a seat at the top table, what's the root cause—and how do you fix it?

You can't get a seat at the top table just by asking for it. You need to deserve it through business relevance.

To sit at the table, you can't just be an expert in HR processes, talent programmes, and compliance. You need to be able to connect business strategy with people strategy, and deliver measurable business outcomes through that connection.

When you can do this consistently, the seat at the table comes naturally. And once you're there, your perspective becomes essential to the conversation.

What CEOs Really Want from HR

You've worked closely with CEOs. What do they really expect from an HR leader but rarely say out loud?

First, they expect you to be an HR expert, that's table stakes. But it's not enough.

Beyond that, CEOs expect three things:

1. Judgement

They want someone who can assess what's working, what isn't, and what should be improved—based on a deep understanding of the business, the operating model, and the people.

2. Courage

They expect you to say what others won't. In many leadership teams, there are hidden tensions—the classic "elephant in the room." CEOs value HR leaders who surface these issues and drive the team to address them.

3. Representation

They expect you to be the voice of the employee. In large organisations, employees are often far removed from senior leadership. HR can represent their concerns, perspectives, and needs at the executive level.

Increasingly, CEOs also expect HR leaders to help orchestrate transformation at enterprise level.

In the AI era, transformation is no longer only about technology implementation. It increasingly requires redesigning:

• Operating models
• Leadership dynamics
• Workforce capabilities
• Decision-making speed
• Learning models
• Organizational adaptability

This is why HR leaders who deeply understand the business and can translate technological shifts into organizational execution will become disproportionately valuable.

When HR leaders deliver on these three dimensions, they become indispensable.

HR as a Business Function

What views do you hold about HR that many in the profession might disagree with?

I believe HR is a business function, not a support function.

To be effective, HR leaders need deep knowledge of the business: the customer, the competitive landscape, the value chain, and where the gaps are. Only then can you act on the people side to close those gaps and create opportunity.

The future relevance of HR will increasingly depend on its ability to impact competitiveness, execution speed and organizational adaptability, not only employee processes.

AI is accelerating this shift dramatically.

A significant part of transactional HR work will progressively be automated. Even areas traditionally considered highly human-centric, like parts of learning and development, are already being reshaped by AI.

This creates a very clear divergence:

• HR functions that evolve toward business, operating model and transformation leadership will move up the value chain
• HR functions that remain primarily process-oriented risk becoming progressively less relevant

This is a unique opportunity for the profession. But seizing it requires both business acumen and at least a foundational understanding of how AI works.

The HR Function in Five Years

Looking ahead five years, what will the best HR functions be doing that most aren't even thinking about yet?

The best HR functions in five years will probably look much less like administrative functions and much more like organizational capability and execution functions.

Their role will not primarily be managing processes, but helping organizations continuously adapt:

• Redesigning operating models
• Accelerating capability shifts
• Enabling faster decision-making
• Supporting organizational resilience
• Balancing speed with trust and psychological safety

They will help companies build environments where people can continuously learn in the flow of work and adapt fast enough to remain competitive.

At the same time, transactional and administrative work will progressively decline through automation and AI augmentation.

The HR functions creating the most value will be those closest to business execution and transformation.

Lessons from Disruption: Nokia, BlackBerry, and AI-Native Companies

Looking at the mobile phone revolution and the dot-com era, what parallels do you see with AI, and what lessons should leaders take from companies like Nokia and BlackBerry?

Nokia was the number one mobile phone company, commanding around 60% of the market. Their phones were fantastic: durable, reliable, with batteries that lasted a week or more.

But they didn't see the disruption coming. The iPhone fundamentally changed the landscape, and Nokia couldn't adapt quickly enough. The same happened to BlackBerry.

Why? Because when you're the leader, you're focused on maintaining leadership. You're managing customers, roadmaps, and quarterly performance. You're optimised for the short term.

Large organizations are often optimized for scale, predictability and risk reduction. Over time, layers of governance, coordination and complexity accumulate.

That model can work extremely well in stable environments.

But AI-native companies are being built very differently:

• Fewer organizational layers
• Faster feedback loops
• AI-augmented execution from day one
• Workflows designed around speed and adaptability rather than legacy constraints

This creates a profound asymmetry.

Established companies are trying to integrate AI into structures designed for a previous era, while AI-native organizations are designing the organization itself around the technology from the beginning.

I see a similar dynamic today.

There are AI-native companies being built from scratch, companies that are fully leveraging the technology and moving at extraordinary speed.

They accomplish in six months what a traditional company would take two to three years to do.

The Speed Advantage of AI-Native Organisations

I'm currently advising a startup where a small team delivers a significant amount of software, but no one is writing code. Instead, they write high-quality specifications. AI generates the software, which then orchestrates AI agents to deliver outcomes.

It's incredibly fast, high-quality, and dynamic. Changes can be made quickly. But the skills required are completely different:

• The ability to write precise, high-quality specifications
• The ability to supervise orchestration of AI agents
• Fast feedback loops to catch and correct errors

Many established companies are underestimating the fact that newcomers are coming, built around AI, moving at 10x speed.

This contrast between established leaders and AI-native disruptors will intensify. And it will happen soon.

Leading Hybrid Organizations: Humans and AI Agents

You mentioned orchestrating AI agents. What does that mean for organisational design and leadership?

In the future, managers won't just manage people, they'll manage a mix of humans and AI agents.

AI is probabilistic, not deterministic. If you give the same input ten times, you might get ten slightly different outputs, and occasionally something unexpected.

That means you need:

• Clear guardrails
• Fast feedback loops
• Humans with the right skills to supervise and intervene

This is why I believe the future operating model of many organizations will become hybrid.

Some activities will remain fully human-driven. Others will be AI-augmented. Others will become partially or highly autonomous within clearly defined guardrails.

The challenge is not simply automation. It is governed autonomy at enterprise scale.

This changes leadership significantly. Leaders will increasingly need to orchestrate ecosystems of humans and agents operating together, balancing:

• Speed
• Resilience
• Accountability
• Trust
• Acceptable enterprise risk

When you have this structure in place, the process can be extremely fast and effective. And AI quality is improving month by month.

At some point, the clash between established companies and AI-native disruptors will come, just like it did with the iPhone and BlackBerry. It's happened many times in history.

Consolidation, Cloning, and Market Selection

Do you see a consolidation phase ahead, similar to the dot-com boom and bust?

Yes, I think so.

In the AI-native landscape, there will be a lot of cloning, similar businesses competing for position. There will be jockeying, and eventually consolidation.

The market does the selection. Some companies will fail. Others will grow. Some will be forced to merge because they lack scale or market access.

This will happen over the next few years. And during this period, a strong, business-focused HR function can play a strategic role.

But HR needs to invest in itself. Too many HR professionals are still disconnected from the business. And not enough understand how agentic AI works.

You don't need to become a technical expert, but you need to understand the basic principles. Because in the future, you'll be managing humans and agents within the same organisational structure.

The Biggest Opportunity HR Has Ever Had

What does all of this mean for the HR profession?

This may be the biggest opportunity HR has ever had to become deeply embedded in enterprise transformation and business competitiveness.

For the first time, technology is forcing companies to rethink simultaneously:

• Operating models
• Workforce structures
• Leadership approaches
• Decision architecture
• Learning models
• Performance systems

This creates a unique opportunity for HR to move much higher in the value chain and become a true orchestrator of organizational transformation, not only a people support function.

AI and data allow HR to:

• Measure impact more clearly
• Use evidence to make stronger cases
• Influence decisions at the highest level

But there's a critical point I want to emphasise:

AI will not replace chief HR officers. But chief HR officers who master AI will replace those who don't.

I'm convinced this is going to happen. The HR community has never had an opportunity like this. But it requires action: learning, adapting, and stepping into a more strategic role.

The future belongs to HR leaders who understand the business, embrace AI, and deliver measurable outcomes.

Final Thoughts

The transformation underway is not just about technology, it's about how organisations are built, how leaders lead, and how HR enables business success.

For HR professionals willing to evolve, this moment offers unprecedented opportunity. For those who remain focused on process and administration, the risk of irrelevance is real.

The choice is clear: become a business function that drives outcomes, or become obsolete.

The best time to start is now.