AS Watson CEO Rejects AI-driven Job Cuts in Favor of Human Partnership

Malina Ngai, the Group CEO of AS Watson, has publicly argued against the common corporate strategy of using artificial intelligence to reduce workforce size. Speaking at the Fortune Leaders Forum, she rejected the notion that AI integration should result in significant job cuts, instead proposing a model where technology serves to augment human intelligence and improve the quality of work. This stance contrasts sharply with recent trends in the tech sector, where companies have laid off tens of thousands of employees as they pivot toward AI-driven efficiency.

The company is implementing a "human-AI partnership" strategy, encouraging employees to use AI assistants as tools for faster and smarter decision-making. Ngai reports that since this initiative launched last October, employee engagement scores have risen significantly. Staff members are spending less time facing screens and more time engaging in face-to-face interactions with customers, a shift that has also led to improvements in customer satisfaction metrics.

Shifting focus from process to people

Ngai emphasizes that the goal is to reinvent the retail model rather than simply optimizing existing processes. She argues that AI offers a unique opportunity to change how the industry operates by shifting the focus away from rigid procedural efficiency. According to reports from GN technics/ai (en-US), the company believes this approach will make retail experiences more human-centric, allowing staff to focus on service and connection rather than administrative tasks.

This perspective aligns with sentiments expressed by other major retail leaders. In May, Costco CEO Ron Vachris similarly stated that AI was elevating workers rather than replacing them. The broader implication is that AI can be used to free up human potential, creating a work environment where technology handles repetitive or heavy tasks, while people handle complex, interpersonal, and creative responsibilities.

Warehouse automation drives workforce diversity

The practical impact of this strategy is already visible in AS Watson's logistics operations. Ngai cited a recent visit to a warehouse in Foshan, where robotic systems now handle heavy lifting tasks. Traditionally, such physically demanding roles were predominantly filled by men, with approximately 80% of the workforce in typical warehouses being male. However, with robots taking over the heavy labor, the demographic composition has shifted, with 62% of the workforce at the Foshan site now being female.

Ngai described this shift as a positive surprise, highlighting how technology can inadvertently promote greater diversity within the company. The change illustrates a broader point about the nature of automation: when it is used to remove physical barriers to entry, it can open up roles to a wider pool of candidates. This outcome supports the CEO's argument that AI should be viewed as a tool for restructuring work, not just for cutting costs.

Avoiding the trap of incremental improvement

Despite the benefits, Ngai warns that the primary risk for leaders adopting AI is using it merely to speed up existing, outdated processes. She argues that applying advanced technology to old methods results in a "version of yesterday," offering little real innovation. Instead, companies must use AI as a catalyst to rethink fundamental assumptions about how business operations work.

This warning underscores the trade-off between efficiency and transformation. While using AI to optimize current workflows is easier and quicker to implement, it may limit the long-term potential of the technology. By choosing to reinvent the model and focus on human capabilities, AS Watson aims to create a sustainable competitive advantage that is rooted in improved employee experience and customer service, rather than just reduced labor costs.