AI is everywhere in private equity. Where's the value?

Last week, I had the privilege of chairing Private Equity International's Operating Partners Forum in New York, where conversations about AI, leadership, talent, and value creation revealed an interesting tension.^[1]

What became vehemently clear is that AI adoption is accelerating, but translating that activity into measurable enterprise value remains a significant challenge. Data presented by Catalant showed AI involved in nearly 3 in 10 recent PE engagements, yet a separate survey found that 94% of portfolio-company respondents had not attributed a quantified result to AI.^[2]

Across two days of discussions, a few themes consistently emerged:

• The biggest obstacles to value creation aren't necessarily technological. They're organizational.
• Data readiness, leadership adaptability, change management, and access to the right expertise are becoming critical differentiators.
• Value creation plans are evolving into more dynamic, continuously reassessed strategies.
• AI is forcing firms to rethink not just their technology, but how work gets done and who does it.

I've pulled together a new white paper with the most important insights, research, and practical takeaways from the event, including data from Catalant, AlixPartners, McKinsey, and others.

Subscribers to The Future of Work received the full Executive Debrief in this week's edition. Subscribe so you get the next one »

Here's what stands out this week:

• AI cuts are announced, not proven. Microsoft offered voluntary buyouts to about 60,000 employees, a quarter of its workforce.^[3] American Express is cutting about 5% of its workforce, roughly 3,500 jobs.^[4] Barclays is cutting 5,000.^[5] We've seen this before: about a third of hiring managers who cut roles for AI later filled the same or similar roles.^[6]
• Compliance pressure isn't new. WorkWhile will reclassify its drivers as employees and pay $2.3M.^[7] Instacart will pay $5M in the government's 15th visa case of its kind.^[8]
• AI activity still isn't AI value. Only 13% of CIOs say their company has realized significant value from AI.^[9]

Here's my interpretation of the data:

1. The cuts make headlines. The rehiring is quiet. Cutting for AI before the work is redesigned leaves a gap, and about a third of those roles come back.^[6] Redesign the work first, then decide who does it.
2. Get compliance right with partners, not on your own. Classification and visa rules have always been hard. The difference now is the ecosystem: EORs and specialist platforms carry that risk for you. That's why EORs are having a moment.
3. Value comes from talent, not tools. 94% of portfolio companies hadn't attributed a quantified result to AI^[2], and only 13% of CIOs report significant value.^[9] The gap is people and process.

The opportunity is significant, but the winners won't necessarily be those deploying the most AI. They'll be the organizations that best combine technology, talent, and operational discipline to turn opportunity into measurable results.

Here's how Human Cloud is helping:

As you hopefully know, we not only lead the conversations to help you get started, we're your honest broker helping you find the right solutions.

Whether it's an EOR, or a specialized developer sourcing solution, we're the neutral advisor that helps you scale your flexible workforce.

• If you need to learn more or gain leadership buy in, book an executive briefing »
• Or if you're in Arlington on November 9, request an invite to our healthcare staffing dinner »

Here's to making the world work!

- Tony

Tony Buffum Co-Founder & Chief Strategy Officer at Human Cloud. 20+ years in global HR and talent transformation. Former CHRO at FLIR Systems, VP HR at Stanley Black & Decker, VP HR Client Strategy at Upwork. Grab time with me »

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