Design the Future of Work Before it Designs You with Tom McCarty

The ground keeps shifting under every org chart, and AI is speeding up the tempo. We sit down with Tom McCarty, CEO of OrgChart, to map a practical path to an AI-ready organization that doesn’t lose sight of people. Tom has helped thousands of companies redesign during M&A, hypergrowth, and downturns, and he shares why most reorgs fail before they start: leaders don’t have a single, live view of their workforce. If your headcount model lives in a dusty spreadsheet, you’re guessing, not planning.

We dig into the steady state of uncertainty that now defines workforce planning and how to build credible what-if scenarios. Tom breaks down the data foundation—connecting HRIS, ATS, LMS, performance systems, and acquisitions into one trusted source—so you can see roles, skills, critical talent, and team dependencies in real time. From there, we explore where AI agents fit in the org chart, how to design for complementarity rather than replacement, and why judgment and empathy still decide the final call. Visualizing teams with real people, not just cells, helps leaders avoid costly mistakes like cutting the quiet expert who holds a process together.

Trust is the next frontier. Tom lays out a clear approach to data security, access controls, and staged AI adoption that protects sensitive information while unlocking speed. We also tackle HR–finance collaboration: how bottom-line targets become brittle when handed off in silos, and how cross-functional planning aligns goals over one, two, and three years. Communication emerges as the underrated superpower—free HR from data chasing so they can orchestrate the trade-offs, sequence change, and tell a story people can follow.

If you’re a CHRO or people leader standing at the starting line of AI-enabled org design, Tom’s first move is decisive: get an accurate current-state view before buying tools. From there, let AI be the copilot that surfaces options while your leaders make the calls. Enjoy the conversation, then subscribe, share with a colleague making 2026 plans, and leave a quick review to help others find the show.

Transcript

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Welcome And Episode Setup

SPEAKER_00 0:02

Welcome to the HR Chat Show, one of the world's most downloaded and shared podcasts designed for HR pros, talent execs, tech enthusiasts, and business leaders. For hundreds more episodes and what's new in the world of work, subscribe to the show, follow us on social media, and visit hrgazette.com.

SPEAKER_02 0:26

Welcome to another episode of the HR Chat Show. Hello, listeners. I'm your host today, Bill Bannham.

Guest Intro: Tom McCarty

SPEAKER_02 0:32

And in this episode, we're going to explore what it really takes to lay the foundation for an AI optimized organization and why many companies risk getting it wrong before they even begin. My guest this time is Tom McCarty, CEO of Orcchart. Tom and his team have helped thousands of organizations rethink their structures during moments of change, from MA and rapid growth to economic downturns and workforce redesign. As organizations rush

The AI Org Design Challenge

SPEAKER_02 1:03

to integrate AI into how work gets done, Tom believes this shift may represent the most dramatic org design challenge we've ever faced. Without accurate centralized people and org data, attempts to redesign for an AI-enabled future risk failing before they start. In this conversation, we'll talk about workforce planning trends, AI agents in the org chart, the trust and data challenges holding HR back, and the critical role HR must play as organizations rethink how work is structured in the age of AI. I hope you enjoy this conversation that I had with Tom. Tom, how are you doing? Welcome to the show today.

SPEAKER_04 1:49

Thanks, Bill. Super excited to be here. It's a great day and uh looking forward to uh to a good conversation.

SPEAKER_02 1:54

Now, Tom, before we get into the meat of our conversation today, we always like to start by uh getting to know our guests a little bit. So why don't you just take a minute, introduce yourself to our audience, and uh tell us a bit about what gets you up in the morning.

SPEAKER_03 2:08

Yeah, uh so Tom McCarty, I'm the CEO of Orcchart, been uh you know running the Orcchart team for uh going on five years now. And uh and honestly, like you know, one of the things that I I love that gets me going is just engaging with my team every day. Uh you know, we love what we do and and we we serve HR, we serve uh the people leaders and organizations. Uh what I get passionate about is is what we build and and uh coaching, developing, and uh building our team and our people. Uh it's one of the things I love the most.

SPEAKER_01 2:40

Thanks for listening to this episode of the HR Chat Podcast. If you enjoy the audio content we produce, you'll love our articles on the HR Gazette. Learn more at hrgazette.com. And now back to the show.

SPEAKER_02 2:56

Okay, love it. Thank you very much. So you work with a wide range of organizations, Tom, using using your software to model workforce changes. What key trends are you seeing right now in workforce planning?

SPEAKER_03 3:10

Yeah, I think a lot. I mean, it's I think the biggest thing right now that we hear from everybody is is economic uncertainty, right? You know, you're seeing it sometimes

Workforce Planning Amid Uncertainty

SPEAKER_03 3:18

feels like we're on a roller coaster of uh, you know, everything's going great and everything that feels like the market's crashing or this and that. So like it's it's the steady state of uncertainty. And then when you're in a steady state of uncertainty, you really need kind of multiple models. Uh, you need to be able to kind of say, okay, well, if this, then that uh type scenario planning. Um, and then I think, you know, look, there's I think in the midst of economic uncertainty, you're always looking for efficiencies, and most businesses usually are anyway. Uh, but I think the need for that kind of compounds when you're when you're faced with economic uncertainty. Uh, and then you know you have this lens of AI that everyone is talking about. This how is AI going to plug into your organization? How are you going to use AI? Uh, how do you get more efficiency out of that? And you know, I think there's a lot, you know, you could re see a lot of messages around the state of your organization if you aren't doing it now, the risk to that in five years out. And so, like, this is what a lot of the discussion is today is like, how do I prepare for the uncertainty that we're continuing to face? Uh, and how do I make myself more nimble and more responsive to that? And how am I going to incorporate this dramatic shift we're seeing in our world with the incorporation of AI into our day-to-day business?

SPEAKER_02 4:32

Okay,

Bringing AI Agents Into Structures

SPEAKER_02 4:33

very good. AI is clearly top of mind for many leaders when they start talking about re-orgs, Tom. Uh, how should organizations begin thinking about incorporating AI agents into their org chart structures?

SPEAKER_03 4:46

You know, the first thing I would say is that when you're starting to think about how you're going to utilize AI agents and how AI agents may uh eventually replace or complement positions in your organization, the first thing you need to do is the first thing I would tell you you need to do in any reorganization and planning, which is to have a better understanding of where you are today. Uh and so you need to kind of be gathering all of your people data into one place. Um ideally, that's got a live stream to it. And the reason that's important is because most of our customers that we talk to, their people data is not in just one location. Their HRIS is not their only location of people data. Uh maybe they have an applicant tracking system, they have a talent management system, they've got you know an LMS or a performance management. Uh maybe they have more than one HRIS because of acquisitions or different geographies that they're in. And so you need to bring all of that into one location. You need a live stream of that so that you have a real-time picture of what your organization looks like and what your teams and people are doing. Um, the reason I think that's incredibly important is because look, planning doesn't happen overnight, but in larger organizations, people changes happen daily. Uh, and so if you're not, if you're just looking at a static version from you know 45 days ago, I guarantee you that's already changed. So you really need that. Um, and then you need to make sure you're looking at the right data and looking at the lenses of your organization to best understand your current state. Because you can't really change where you're going if you don't know where you are. Uh, and what we see is that you know, the very large percentage, we've seen up to 80% of customers saying they don't have good visibility in their organization. It's like that's where you have to start uh before you can start to think about shifting. And whether that's AI agents or just planning for you know a RIF or planning for growth, you need to know where you are before you start thinking about where you

Consolidating People Data In One Place

SPEAKER_03 6:39

go.

SPEAKER_02 6:39

Okay, so just to continue on from what you were saying a moment ago, Tom, um, as you often stressed the importance of clean, consolidated organ people data, uh what are some of those best practices for getting that foundation right around the data before attempting any kind of redesign?

SPEAKER_03 6:55

Yeah, so so yeah, first of all, it's just what we talked about, right? Get get it into a single place, make sure it's a live connection. But then it's like, what do you need to look at? What's the important things that matter to you and your organization? And the first thing I'll tell you is like there's not a one size fits all, right? So what's important to my team may not be important to your team, uh, but you need to identify kind of what is, what does matter, and what are the ways in which you you track critical talent, key talent uh indicators, for instance. So like I have seen you know situations where someone's doing a restructuring and they let someone go that was a critical talent or key talent member of the team because they weren't looking at that data and this became a spreadsheet exercise, right? Or maybe I looked at this job band of like all of these different positions, but I didn't look at a couple of individuals and realized the critical talent that they might have been in the organization, and therefore we restructured without realizing the impact we were actually making. Um, and so that's why it's really important to look at your people, to look at the jobs and the positions. You have to look at kind of it through these different lenses and ensure that you're not making changes that are going to disrupt that you don't think to. And when we only look in a spreadsheet, where we only look at just roles, or we only look at just people, we're usually missing layers. Um, and that's why reorganizations, you know, uh fail at a very high rate. I think McKinsey uh did a study, I believe, last year, it was showing something like 70% of reorganizations fail. And where I believe it fails is it

Best Practices For Clean Org Data

SPEAKER_03 8:19

fails in like not knowing where we're starting and the goals of what we're trying to accomplish. Uh, because that's you know, that's really the core of what you have to go do before you start restructuring your organization.

SPEAKER_02 8:31

Okay, so in terms of setting those goals, then being sure what you want the outcomes to be are to limit the um high possibility of failure, but that sounds a bit for with many organizations. Um, from what you've seen, what are those key most common pitfalls that organizations should watch out for when undertaking that re-org?

SPEAKER_03 8:50

Yeah, I mean, I think, you know, you know, we're we're a growing company as well. And one of the things we're doing right now is looking at, hey, what do we need to be doing in 2026? Well, one of the first things that we do is look at, okay, well, what's important to us this year, next year, three years down the road. And and then we look at like what's what's missing in our organization, right? Like what are the things and the components that we have, what are the components we don't have, uh, and then we start to build with that intention. So maybe some of that is skill sets, maybe some of that is specific talent. Um, but I think you have to know two things. One, you need a longer view of where you're going. So let's talk about AI, for instance. If in five years uh you want to be a richly embedded AI company, an AI forward company, then you need to look and say, well, what's our assessment today? What does one year from now need to look like? What's two years from now need to look

Goal Setting And Reorg Pitfalls

SPEAKER_03 9:43

like? Um, and you kind of have to blend that. You know, I would say it's kind of like budgeting, right? And you know, we talk about tops down and bottoms-up budgeting. Well, I have this view of a top down budget of where I want to go. A bottoms up is like, what can I get to that I know of right now? And then that in between is what you actually have to plan for, right? Same thing in people planning and building the skills in your organization. Here's where I want to go, here's where I am. And you have to have a really strong assessment of both, and then be able to analyze what you need to build to bridge that gap between the two. Um, and I think that intention around that goal setting and that clear picture of where we are is where a lot of these things fall apart, right? Um is maybe I'm doing a really good job of talking about where I want to go, um, but I'm not doing a really good job of really analyzing the strengths and opportunities of my team and the gaps that just don't exist. Or maybe I have a good picture of that, but I don't have a great vision beyond just 12 months of where I'm needing to build for NCO in my organization, which means maybe I'm building some short-term goals, but I'm never building that long-term things that need to change in a team.

SPEAKER_02 10:47

Let's continue on with that focus on the role of the team and individuals within this augmented process. One concern that HR leaders raise is the risk of modeling people like numbers. As AI becomes more embedded in workforce planning, Tom, how can organizations avoid losing that human element?

SPEAKER_03 11:07

Yeah. You know, one of the reasons we we encourage people when you're doing planning is to look at your organization in the org chart, is because I think when you're actually seeing your org, um, and and by the way, one of our most popular charts is uh the ones with photos in it, the ones with like the people in the chart. So when you're sitting here looking at your team and you're looking at the assessment of it and actually seeing how it's structured, um, I

Keeping The Human Element Intact

SPEAKER_03 11:30

think that brings the people element into it, right? Uh, and so like I said, it's important to look at it in both the employee and the people lens and the job and position lenses. Um, but it's important to look at both. And I think as you're building AI, and by the way, this is true whether you're building for AI or not, right? If you're uh having to make a 10% reduction in an uncertain environment, you need to connect yourself to your teams and connect what it is. And I think spreadsheets kind of desensitizes to that in many ways and forces us to make uh it doesn't force us to make the harder conversations of uh what's the total impact of the changes I'm about to make. We have to make the choices, but are you looking at all the lenses at which you should? And so I think that's one way in which you can do that. Um, but I think this is a lens you have to look regardless of AI. Um, you know, I think when you're looking about AI, though, I think what I we hear people talking about and our customers talking about, and that I see how I think about it, is like, how do I complement AI with the human touch? And so, like, where am I building AI into maporization, but how am I keeping that human element there? Uh, especially when I'm talking of interacting with customers and building things internally. You know, we're we're trying not to just do free reign of that, but actually building that as complementary, um, building that as a way that uh that complements and brings more uh efficiency into our teams, but not in a way that just completely unplugs the people from the organization.

SPEAKER_02 12:53

And that does that touch on this term that you talk about a lot, which is the trust gap when it comes to embedding AI within your processes?

The AI Trust Gap And Security

SPEAKER_03 13:03

You know, I think it it certainly can, right? It's like, hey, do we lose uh do we lose touch with our customer? Do we lose touch with our people uh the more that we we kind of get this full AI embedded into the organization? I think there's another layer of the trust gap, especially is like, hey, what things am I comfortable using AI for? Um like where's my comfort level as an organization today in what I am ready to do? Uh and I think some of that comes with your maturity of how you're deploying AI. Um, some of that comes with what your organization is ready for and your security posture of that. And like, as an example, I think in some things on a trust app, like if you're plugging AI into your people data, well, do you have good security and parameters around that to ensure that uh you know each team member is getting access to the relevant data without getting access to data that would be harmful or that uh they shouldn't have access to, whether that be uh you know, salary or job performance data, or whether that be PII data of employees, because when you think about what all your HR systems have, there's a lot of personal data that's in that. And so I think there's there's twofold on that. One is the how do we make sure we're continuing that human element within an organization? How do we stay in touch and feeling kind of that heartbeat of our customer, the voice of our customer? Uh, and then I think the other is like, hey, how do we make sure we're doing this in a secure way? What information should we be uploading into AI? How do we ensure that what is in the AI agents is uh either the right stuff to be accessed by a larger audience or has security controls and access controls around it so that we're not uh you know exposing data beyond where we want it to go?

SPEAKER_02 14:42

We

HR–Finance Collaboration Dynamics

SPEAKER_02 14:43

are increasingly seeing CHROs and HR leaders coming from finance backgrounds, coming from data backgrounds as opposed to traditional HROs. And in fact, many of the more senior HR folks these days are called people directors as opposed to a CHRO for example. Um, and that's because um everybody's got a lot more faith in the data these days. We're seeing growing interest from finance teams and people data and workforce modeling. W where does HR finance collaboration work well, Tom? And where can it still maybe create some tension?

SPEAKER_03 15:15

You know, um I think that you know where it tends to work well is when there's deep collaboration. And by the way, not just with HR on finance, like you really, you know, if we talked about what we said, how do you how do you really successfully nail a restructuring? How do you successfully say, here's the growth plan for the next two years or three years, whatever it may be? Um, well, that comes with really deep assessments of your current state of your organization and a strong vision of where you're going. And finance and HR can't do that alone, right? Like it really needs to be the executive team as a whole, digging in and saying, what do we need to go accomplish? Because if you're to go accomplish your goals, um the biggest asset we have to how we do that is our people, right? And so whenever these things are happening in siloed environments, they're going to fall apart. Uh, but the more cohesive the organization is around what we're where we are, where we're going, and then building that plan of how we get together, uh, the more successful you're going to be. Uh, I think a lot of times what I see happening is that finance is starting the process by simply saying, here's the budget. Uh, you have this much more to spend in headcount next year, or you have to cut this much. And and look, finance is is in the end, it's coming down to a bottom line, and that is the role of finance, right? The role of finance is making sure the financial health of the company is intact and that we are staying capitalized and that we're we're spending our resources or dollars responsibly to achieve our goals and objectives, right? And profitability and and uh you know cash uh sustaining is one of those objectives. But I see that that often is like, hey, uh, you know, if I'm finance, I'm kicking that over to you, Bill, and saying, okay, Bill, you're on the HR side, now go execute, right? And you've got this spreadsheet and a number you've got to go hit. And then you start working in spreadsheets and you're trying to go hit that number. And you're using that by a lot of times looking at just comp data and saying, okay, well,

Communication As A Strategic Skill

SPEAKER_03 17:10

where can we adjust and what what are the trade-offs that we can go do? And I think that is often how these things fall apart, right? Is they become these spreadsheet exercises kicked from one department to the next. So you get the document for finance, and you say, okay, department leaders, I've now divided this up, now you go do this. Uh, and we're just trying to solve for the bottom line. Uh, and we're trying to get to that number target we want. Um, but I think if we're trying to hit that number target with a deep understanding of where we need to go, and we're having the discussions about here's where we are, here's where we need to go, here's the pieces we need to build, and how and the parameters of which we need to work within. And you're having a holistic conversation across your organization, right? So it's not just finance and HR, but it's finance and HR, executive team, the people leaders with a clear vision of what we need to go do. That's how we win, that's how we succeed.

SPEAKER_02 18:01

That's really interesting. So I'm having a lot of conversations. We're recording this episode, uh middle of Feb 2026. I'm having a lot of conversations this year with uh analysts from Gartner and places are telling me, Bill, um, uh successful organizations in the next 12 months are those that um uh have great communicators who can plug those gaps in between departments. Um it gives hopes to guys like me who did a social science uh degree. Yeah, that you know, uh those sorts of um communication people skills are actually terribly important um to make sure that uh the rollouts happen, that we make the most of the new technologies available to us. Is that your take?

SPEAKER_03 18:42

Yeah, I completely agree. Uh, you know, it's you know,

AI As Copilot, Not Autopilot

SPEAKER_03 18:47

and by the way, like one of the things I think that HR does best is that, right? Like facilitating how do we get the most out of our teams, how do we get the most out of our people? I think so often, man, though, HR has become this like source of data and execution of our people, right? Um, and so you know, we've taken people whose passion, uh, you know, the leaders in our organization who come and work in HR. I don't think very many leaders in HR said, I want to get into HR because I really want to work spreadsheets. I want to get into HR because I really want to hunt down data in 10 different systems and figure out how to piece it all together. And I talked to so many HR leaders, and that's what they're doing, right? It's like I am just trying to get all the pieces together so that we have a basic view of something, right? Um, and yet they're the people who are trained and passionate, and like it is their superpower to like connect all of these organizational thoughts, to communicate across the organization, to help connect marketing with their people and like what the plan is of what they need to go build. So, you know, that's one of the things that I get passionate and excited about in what we do is we're trying to like offload some of that from HR to say, we'll gather all of your data, we'll give you the single views so that you can go lead those conversations, because those conversations are going to be the key to success in the years ahead.

SPEAKER_02 20:07

Okay, so it's nice to hear that in your opinion, there is still a role for humans in the organization. Um, but that said, specifically within um the the the function of optimizing workforce plans, you know,

First Step For CHROs Starting AI Journeys

SPEAKER_02 20:21

as as you as you look ahead to the near future where AI can perhaps independently build or optimize workforce plans, um will that take over or will human judgment always be essential in the process?

SPEAKER_03 20:36

Yeah, I think human judgment has to has to be there, right? And that's kind of certainly a philosophy I have with AI in general, is that uh it's gonna surface insights, it's going to uh bring us awareness to things that maybe we might have missed, it's gonna help us to look at large quantities of data and and and answer questions about that. But in the end, you still have to have kind of that human element of looking at those things and looking at the options and saying, well, what's what's the right thing for our business? What is what do we need to go do and understanding that? So I don't see a scenario in which you just uh turn over your organizational design to AI. I do see a scenario in which AI is going to help you uh you know surface more insights and data about your organization. It'll help you answer questions quicker so that you can make better decisions. Um and I think AI can even make suggestions of options of things you could go do. But in the end, you still

How To Connect With Tom And Resources

SPEAKER_03 21:30

need your leaders, you still need people who are looking at the strategic direction of where we're going to make the decisions and to make the calls of that.

SPEAKER_02 21:38

Tom, you're not going to believe this, but we are already coming towards the end of this particular conversation. I've just got two more questions for you. Um so if if you're advising an A CHRO starting their AI enabled org design journey today, what's one thing that they should focus on getting right before technology decisions?

SPEAKER_03 22:01

Yeah, and I think the first thing is again, it's gathering the correct views of your current state of your organization, right? What where is everybody? What is everybody doing? What are the strengths, the opportunities, and the gaps of your current organization? You can't uh make changes until you know uh you know what you have, uh, what is best suited uh for uh enhancement through AI and where the gaps are. Uh so the current state, uh, getting that live feed of your data, getting that consolidated view of your organization so that you know your current state allows you to then say, okay, where do we go next uh now that you know where your starting line is.

SPEAKER_02 22:40

Okay, wonderful. And just finally for today, Tom, how can our folks who are listening to this episode connect with you? Um so maybe might want to share your LinkedIn email. I bet you're super cool, and on Instagram and places. Um, and of course, how can they learn more about chart?

SPEAKER_03 22:57

Absolutely. Uh yeah, please uh follow me, Tom McCarty, on LinkedIn. Uh you can reach me, Tom, at the Orcchart uh to reach out. Uh and then uh we you can find us today, and we've got a landing page for this conversation um at uh theorcchart.com slash HRChat. Uh and we certainly look forward to connecting and helping anyone out that that uh would like to have more discussions on this journey.

Closing And Subscribe CTA

SPEAKER_02 23:21

Wonderful. Well, that just leads me to say for today, and I'm sure I'll be bothering you to come back on the show again in the near future, but for today, thank you very much for your time.

SPEAKER_03 23:29

Thanks so much, Phil. Enjoyed it.

SPEAKER_02 23:31

And listeners, as always, until next time, happy working.

SPEAKER_00 23:38

Thanks for listening to the HR Chat Show. If you enjoyed this episode, why not subscribe and listen to some of the hundreds of episodes published by HR Gazette? And remember, for what's new in the world of work, subscribe to the show, follow us on social media, and visit hrgazette.com.