Earlier this year, Meta created a “plan” to reduce some of its teams by as much as 60 percent to make the company “AI native,” Reuters reported today, citing two people familiar with Meta’s internal affairs.
Reuters’ report highlights the challenges organizations face when analyzing the best uses for AI and determining when the technology is a better fit for certain tasks than employees.
Meta confirmed to Reuters that the plan, reportedly codenamed Project OT (short for organization transformation), explored scenarios in which Meta reduced some team headcounts by 60 percent and that the plan called for two rounds of layoffs. Meta wouldn’t confirm which teams Project OT affected.
Meta told the publication:
As part of our company restructuring earlier this year, we asked some teams to conduct a scenario planning exercise looking at the potential impact of redeployments, open role closures and cuts. This ultimately resulted in moving thousands of employees to do priority work on several newly-established teams, as has been publicly reported. Ultimately, we didn’t move forward with every scenario from the exercise – and it was never assumed we would.
Reuters reported that Meta CEO Mark Zuckerberg “set Project OT in motion and directed executives to proceed with the changes to management structures” earlier this year. It said that the first round of layoffs from Project OT occurred in May and that Meta canceled the second.
Reuters said it reviewed “scores of internal documents, posts, and recordings” and spoke with “more than 20 people with knowledge of Meta’s inner workings” about the since-scrapped plans.
Per the publication, Meta executives created Project OT in January. Project OT reportedly explored using AI to perform “much of the daily work performed by thousands of human employees.” Small teams of people would oversee the AI, the report said, citing “one internal planning document reviewed by Reuters and three people familiar with the project.”
In these scenarios, Meta would give some employees new roles and lay off others. One HR executive reportedly said that Meta would have reduced its headcount by about 25 percent or more under these scenarios. Meta told Reuters that it canceled Project OT before determining how many layoffs the plan called for.
Meta was going to use some of the money that it saved from layoffs to pay for high-performing employees, especially those with AI engineering skills, Reuters reported, citing “two people familiar with the matter.”
“AI native”
One of the Project OT documents that Reuters reviewed described “AI native” as a company where “AI-ready tools and agents interact, workflows are automated, [and] new builds are AI-first.” Being “AI native” also means, per the document, selling AI agents to third parties, which Meta started doing in June.
This year, Meta reportedly launched a pilot program that restructured engineering teams, research teams, and at least eight other teams into smaller groups.
This followed the reported October publishing of an internal post called “AI-Native Playbook,” in which a Meta product management team member outlined how the pilot would remove middle management and use “agent-assisted analysis” to help prioritize daily tasks.
Reuters noted that HR employees and “AI systems” would help Meta’s leaders decide about promotions; however, Meta told the publication: “Performance rating and promotion decisions were and are made by people, not AI.”
Second thoughts
Immediately after issuing the May layoffs, Zuckerberg reportedly canceled the November wave. Reuters said it “was unable to determine what exactly prompted Zuckerberg to shift course.”
Reuters said March and April reports of impending layoffs and Meta tracking employees’ keyboard and mouse input in order to train AI agents (Meta has since paused the program) hurt employee morale.
Another potential factor in Meta’s decision to scale back Project OT was uncertainty about whether increased AI use would boost productivity. Citing internal posts, Reuters noted: “For instance, code changes made to the internal software platforms and infrastructure employees use on the job were up 220 percent year-over-year, according to a post by [Meta CTO Andrew] Bosworth in early June. But changes that led to new or upgraded features reaching Meta users were only up 36 percent.”
Internal posts also reportedly pointed to AI agents making “large-scale, disruptive actions that humans are unlikely to execute” and leading to a 40 percent increase in major technical and security incidents compared to the prior year. Employee time spent resolving those problems increased by as much as 70 percent. Meta declined to comment on these internal posts.
In July, however, Zuckerberg reportedly acknowledged during a company meeting that the “trajectory of the agentic development over at least the last four months hasn’t really accelerated in the way that we expected.”
Many organizations, including those much bigger and much smaller than Meta, are exploring ways that AI could help with company goals, such as by saving employees time, driving revenue, or reducing costs, including, in some cases, human resources. Meta’s story also shows how far some firms are willing to go to implement AI in an advantageous way, even at the cost of jobs.
Meta’s case suggests that even some of the most eager organizations may struggle to replace various human workloads with AI while also highlighting the risks of overzealous AI projects.
