HR must move from a support function to a central role in business transformation as companies adapt to AI-driven change, according to Andreas Papadopoulos, Senior Manager Advisory at PwC Cyprus.

Papadopoulos noted that workforce is increasingly the decisive factor in whether business reinvention and transformation succeed, while HR functions are expected to enable and empower this shift.

Drawing on recent PwC studies, he observed that “a clear message emerges, in an AI-enabled economy, HR must be repositioned as a core engine of transformation”, with skills, operating model and responsible AI adoption at the heart of its mandate.

Referring to PwC’s 27th Annual Global CEO Survey, he explained that workforce relevance is both the biggest challenge and the greatest enabler, with future skills, workforce adaptability and culture seen as the primary barriers to transformation but also as “the most powerful accelerators when managed effectively”.

He added that AI and the workforce now sit at the centre of business reinvention, with CEOs increasingly viewing AI adoption as “business model redesign, not just a technology rollout”.

This requires fundamental changes to roles, capabilities and ways of working, he noted, adding that “AI and people are at the heart of business reinvention”.

Papadopoulos also pointed out that CEOs increasingly view AI adoption not merely as a technology upgrade, but as a redesign of the business model itself, requiring fundamental changes in roles, skills and ways of working.

In this context, he stressed that HR can no longer operate as a support function and must instead help leaders address “how we bring the right people with the right skills in, how they can leverage AI in a way that creates value for the business, and how we can make efficient processes”.

To become a true transformation engine, Papadopoulos argued that HR should be at the forefront in two strategic areas of critical importance.

The first is understanding how roles and skills will evolve. He explained that HR must move “from traditional headcount to workforce architecture”, redesigning roles and processes around what can be automated and where human involvement is critical for value creation, innovation and customer experience.

In this process, he added, HR must take an outward-looking mindset to understand industry shifts and technological advancements and better serve business priorities.

The second area is embedding AI responsibly.

Papadopoulos noted that embedding AI in a way that delivers benefits to the business involves everyone, adding that “the strategy, approach and principles should be holistically viewed and codesigned with the Top Management, Legal, Risk, and IT capabilities”.

Within this framework, he explained that HR should bring the workforce element into play and be in a position to understand how decisions around AI affect skills, processes, hiring and the development of people needed to meet expectations and future roles.

Looking ahead, Papadopoulos concluded that as AI moves from experiment to everyday reality, HR faces a choice between taking “the comfortable back seat” and becoming an architect of a workforce and operating model capable of delivering sustained business growth and real value.