'I do not recommend that at all': IgniteTech CEO after firing 80% staff because they refused to adopt AI fast enough

Eric Vaughan, CEO of enterprise-software firm IgniteTech, decided to bet everything on artificial intelligence; he knew it would be a gamble. What he didn’t expect was how hard it would be to bring everyone along.

By early 2023, Vaughan had become convinced that generative AI was a make-or-break moment for businesses left, right and centre. The shocker for him was that his team was not fully aligned with that vision, due to which IgniteTech replaced nearly 80% of its workforce within a year as it pushed to become an AI-first company, Fortune reported. 

He, however, added that he does not recommend others to do the same and remove 80 per cent of their staff.  “I do not recommend that at all. That was not our goal. It was extremely difficult.” 

He further said that the team has to be in the same boat and row in the same direction. Between 2023 and early 2024, hundreds of employees were replaced, though Vaughan declined to give a specific number. 

“In early 2023, we saw the light,” he said, adding he believed every tech firm was at a crucial turning point on AI adoption. “Now I’ve certainly morphed to believe that this is every company, and I mean literally every company, facing an existential threat by this transformation.”

The shift began with a company-wide call. Vaughan told his global remote team that from that moment, everything would revolve around AI. He said that to achieve this vision, the company invested time and tools to power employees with a new skill. 

“Every single Monday was called ‘AI Monday,’” Vaughan said. “You couldn’t have customer calls; you couldn’t work on budgets; you had to only work on AI projects. That culture needed to be built. That was the key.”

Roughly 20% of the company’s payroll went into this training effort, but enthusiasm was uneven. “In those early days, we got flat-out, ‘Yeah, I’m not going to do this’ resistance,” Vaughan said. He said that the company fired all those people who were resistant to embrace the change. 

Vaughan added, the resistance came mostly from technical staff rather than marketing or sales teams, who were more open to experimenting with new tools.