Why Some Companies Are Rethinking The Use Of Ai

AI in most workplaces is here to stay. But several businesses bought into the early hype that generative AI would eliminate the need for hiring people and help trim payrolls, only to learn the hard way that robots aren’t yet ready to replace humans.

AI-ers’ remorse: A recent survey from Orgvue noted that more than half of business leaders said they regretted laying off employees as a result of an AI deployment. The research also found that 40% of executives reduced staffing in order to implement AI, and 55% of those robot-lovers regretted that decision. Per S&P Global, 42% of companies abandoned their generative AI pilot projects in 2025, up from 17% last year.

To err is human, to rehire divine

Several companies quickly embraced AI as the employee of the month only to find themselves like Rose in the freezing cold Atlantic, blowing her whistle after the Titanic sank. Here are some of the companies that want people to come back:

• Klarna: CEO Sebastian Siemiatkowski said his push to use AI in a customer service role was a mistake because people would prefer to talk to humans than robots, something that eluded him even though that’s been true since the first automated voice on the other end of a phone call said, “To speak to an operator, press 0.” Siemiatkowski is not above AI replacing himself, though: You can call a hotline to give feedback to his AI-generated clone.
• IBM: After laying off 8,000 people, including many people in human resources roles who were replaced with the AskHR AI service, the company reversed course upon realizing humans may be better equipped for a job with “human” in the title.
• McDonald’s: Using AI to take orders at drive-thrus turned out to be a clown show, with the tech adding bacon to an ice cream order (among other issues).
• Duolingo: CEO Luis von Ahn made a big statement that the company was going “AI-first” and replacing contractors with AI, but he walked back that plan after facing backlash from customers.

Zoom out: The rush to get up to speed with a hot new technology was partly due to fear of falling behind competitors welcoming it with open arms, like Apple being left in the dust by its rivals on the AI front. But according to a report from The Economist, most companies aren’t clamoring for AI that’s more clever—they need tech that’s more applicable to their businesses.—DL