Sarah Franklin was appointed CEO of HR technology company Lattice in January. Within seven months of starting the role, she found herself at the centre of a social media storm.
In July, Franklin posted on LinkedIn that Lattice had become the first company to create employee records for “digital workers”. The new feature would allow AI assistants to be onboarded, trained, tracked and assigned tasks by a manager.
The update was met with almost universal criticism online as people questioned the comparison of human employees to new AI systems. “I can’t decide if this is just ridiculous and stupid or seriously dangerous,” wrote Chris Nicol, vice-president of product at AI invoicing company Xelix.
What is agentic AI?
Reflecting on the situation, Franklin says it was all down to a “big misunderstanding”. “People thought we were saying that AI was human,” she says. “The irony is, I believe quite the opposite. AI is absolutely not human.”
Lattice had reportedly cancelled its AI employee features following the backlash. However, Franklin appears to have softened her stance since then, saying that Lattice has merely “pressed pause” on the project as it continues to review its own AI agents internally.
While she admits the language used in her post could have been more carefully considered, Franklin stands by the sentiment of her original statement. “I don’t think it was a mistake,” she says. “We sparked a very important conversation; it was perhaps prescient. From my vantage point as a tech CEO, I knew what was coming with agentic AI.”
In the months following Lattice’s announcement, a number of tech companies have launched their own form of AI agent, including Google, Microsoft and Franklin’s former employer Salesforce, which promise to complete complex business tasks that are usually performed by employees. Over 100,000 organisations to date have used Microsoft’s Copilot Studio to create their own AI agents.
“We’re at a point with AI where there are more questions than answers. We do not have the playbook for what it means to bring AI into our workforce. What we do have are cautionary tales of other technologies,” Franklin says, pointing to the impact social media has had on incidences of depression and anxiety.
HR and AI governance
CEOs are already evaluating whether investment in AI could allow them to reduce headcount across their business. Klarna’s CEO, Sebastian Siemiatkowski, has suggested the technology could help his company halve its workforce after claiming its AI assistant is capable of doing the work of 700 employees.
While Franklin admits she fears we may be heading down a familiar path with AI, she stresses that fear shouldn’t drive decision-making. “It’s an opportunity for business leaders to hold ourselves accountable, to be transparent with our use of AI in our businesses and to educate and bring our workforces along,” she adds. “We don’t have to wait for regulation to be responsible stewards of technology.”
We’re at a point with AI where there are more questions than answers
In her view, the HR function has an important role to play in governing AI. “The head of HR is the one person at the leadership table whose primary concern is the success of the people,” she says. “We want AI to be in service of people, not just in service to the business.”
Many elements of good people management can be applied to good AI governance, according to Franklin. In the same way a new employee must be onboarded, AI will soon have to be trained on company values, comply with a code of conduct, be set goals and be held accountable if it doesn’t achieve them, she says.
“AI has evolved to be more than just a programme. That’s why HR, in partnership with tech leaders, should have a governance process for AI,” Franklin adds.
The CEO/CPO relationship
Adding AI governance to the chief people officer’s expanding list of responsibilities is unlikely to be a popular move but Franklin recognises the challenge faced by those in the HR profession. “HR leaders need to understand your business goals, people, systems and technology, while also staying abreast of the ever-changing legal compliance and regulatory landscape,” she says.
However, CEOs should be shouldering more of the people management remit, in Franklin’s view. She encourages business leaders to “go back to basics” and focus on employee performance and workforce planning. “The CEO/CPO relationship is very important in determining your values and priorities and aligning the workforce with them,” she adds.
We don’t have to wait for regulation to be responsible stewards of technology
Employee engagement remains persistently low across Europe. On average, 72% of European workers are not engaged at work, while 16% are actively disengaged, according to Gallup. Addressing this issue is a priority for 44% of Lattice’s HR customers.
“What we’re seeing is the result of a lot of the change fatigue,” Franklin says. “A lot of companies have gone through workforce, leadership and strategy change and, combined with changes in the macro world, there’s just a lot going on.”
Finding stability will be important for companies moving forward. Franklin explains: “As leaders, you need to listen, be clear about your priorities and work with your workforce towards a vision.”
Franklin is undeterred by the pushback to Lattice’s previous AI features and the technology remains a key focus for the company, which counts OpenAI, Anthropic and Perplexity among its 5,000 customers. She is particularly excited about the potential for AI to “democratise” the learning and development space by reducing the cost of coaching.
Despite these advances, Franklin recognises that an organisation’s human employees should remain the top priority. “No matter how much advanced technology we have and no matter how incredible AI is, at the end of the day, people are the most important thing to invest in,” she says. HR will play an important role in ensuring companies get this balance right.
