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Headcount Planning With AI

5 min read

Eng Manager

You're the one with the headcount spreadsheet. Push back on 'fewer people, same output' if the math doesn't work. Bring data.

Cto

You set the targets. David implements. Align on: are we cutting, holding, or growing? AI changes the ratio — don't pretend it doesn't.

Tpm

Your capacity models need to account for AI. 'Same team, 20% more throughput' is a real scenario. Plan for it.

Headcount Planning With AI

TL;DR

  • AI multiplies output. That doesn't automatically mean "fewer people." It can mean "same people, more scope" or "fewer people, same scope." You choose.
  • The math is messy. Don't promise 2x productivity. Do model scenarios: optimistic, realistic, pessimistic.
  • David plans for 40 people. AI might mean 35 can do the same work. Or 40 can do 20% more. Plan for both.

Leadership wants to "do more with less." Fine. But "less" has limits. Someone has to do the math and say when it breaks.

The Scenarios

  • Optimistic: AI gives 30% productivity lift. Same headcount, 30% more output. Or 23% fewer people, same output. (Rough math.)
  • Realistic: 10-20% lift. Modest headcount reduction or scope expansion.
  • Pessimistic: Adoption is slow. Little impact in 12 months. Don't cut preemptively.

You don't know which you'll get. Plan for the middle. Adjust as you learn.

What to Push Back On

  • "AI means we need 30% fewer engineers." Ask: "Based on what data? We haven't run a pilot yet."
  • "Everyone else is cutting." Response: "We should have evidence before we cut. Let's pilot, measure, then decide."
  • "It's just efficiency." Reality: Efficiency plus quality matters. Cutting too deep burns people out. Retention tanks. You lose more than you save.

The Headcount Conversation

Bring numbers. "We have X engineers. Our pilot suggests Y% productivity gain. That could mean [scenario A] or [scenario B]. I recommend we [hold/grow/cut modestly] and reassess in Q3." That's a position. That's leadership.

Quick Check

Leadership wants to 'do more with less.' AI multiplies output. What's the SMART way to plan headcount?

Finance says 'AI means 30% fewer engineers.' You don't have data. You can't push back. You accept the target. Chaos follows.

Click "Data-driven" to see the difference →

Do This Next

  1. Model your org with three scenarios: 0%, 15%, 30% productivity gain from AI. What does headcount look like in each? What's the risk of each?
  2. Align with your manager on the narrative. When they ask "can we do this with less?" you need a shared view of "how much less, and when."