Human Capital Intel - 7/22/25
"Routinizing" change | Why is RTO still a fight? | State AI laws multiply | Belonging as an engagement strategy | Excuses not to adopt AI
Welcome to the latest edition of Human Capital Intelligence, your weekly brief synthesizing over 250 leadership, HR, and people sources to filter out the noise. As always, we would love to hear from you at ken@reyvism.com with questions you’d like answered or topics covered.
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By Ken Stibler; Powered by Reyvism Analytics
Deep Dive: Really, why are RTO efforts on an ongoing issue?
This week saw another flurry of RTO stories from workers ignoring Fortune 500 back-to-office orders to Starbucks treating it as stealth layoffs, the three letter acronym is still firmly at the center of people leaders’ agendas. Why though, five years after the pandemic began, are return-to-office battles still playing out across companies of every size?
The answer isn’t simply that employees want flexibility and companies want control. It is RTO has become a proxy for deeper tensions around trust, accountability, and how much companies are willing to evolve.
Some employers are using RTO as a soft tool for workforce reduction. When severance budgets are tight and job openings scarce, mandating a four, or five-day office week effectively nudges people to quit without the financial costs of layoffs. It may serve short-term goals, but it’s a blunt instrument that often backfires. Companies end up losing high performers who can find other offers, while lower performers stay — an inverse selection problem that weakens teams instead of strengthening them.
Even when the motive isn’t attrition, most RTO efforts are poorly executed. Leaders cite culture and collaboration, but lack clarity, coordination, and consistency. Office attendance policies change faster than trust can keep up. Some companies quietly exempt their most critical employees, while others overreach and damage morale. Meanwhile, hybrid work has matured. Managers have real tools to lead remote teams, and employees have built effective rhythms around flexibility. RTO remains an issue not because the hybrid model doesn’t work, but because many companies still haven’t decided whether they’re adapting or resisting.
HCI View: There are only two coherent paths. Either build a high-trust, high-accountability hybrid model that works on purpose, or treat full in-office work as a cultural differentiator and invest in making it worth the tradeoff. Anything in between will signal inconsistency…and cost you talent.
‘Routinizing change’ is the modern leadership imperative
Disruption is no longer episodic, and neither should be the way organizations manage it. New data from Gartner shows that most employees don’t trust their companies to handle change, and fewer than one in three leaders achieve effective adoption. As overlapping shifts in technology, regulation, and strategy accelerate, the era of change as a one-time initiative is over.
The most resilient firms now treat change as a routine operating condition. That means redefining the role of managers as continuous change leaders, embedding small-scale practice into daily workflows, and addressing the emotional cost of uncertainty head-on. The payoff is material: organizations that routinize change report up to double the year-over-year revenue growth.
This is not a messaging problem, it’s an operational one. Change must be embedded into the mechanics of how teams work, not just how leaders talk about the future.
HCI View: Identify one active or upcoming change and assign each team a micro-habit to repeat weekly. Track execution, not buy-in, to build resilience through repetition.
Quote of the Week: Rising Risks from ‘Deepfakes’
“The whole reason you need to worry about deepfake job seekers is, at the very least, they’re making the real employees, potential employees and candidates not able to get the job or [get the] job as easy. It can create all kinds of disruption, just making the hiring process longer and more expensive.”
—Cybersecurity Consultant Roger Grimes on the growing trend of AI interview deepfakes and their impact
Reading List:
AI adoption excuses proliferate
From project failure to ethical dilemmas over layoffs, the list of reasons CEOs use to stall or sideline AI efforts is growing. High failure rates, vague business value, poor workforce readiness, and misplaced expectations around ‘agentic AI’ have given cover to indecision, even as pressure to act mounts. The result is a widening gap between AI ambition and execution, where misaligned pilots, underfunded adoption plans, and fear of disruption all combine to delay the real work of integration. These setbacks are not reasons to pause—they are cautionary lessons to absorb for the companies that see AI as a core driver of competitive advantage.
States push towards AI laws
Speaking of reasons to run and hide from AI adoption: with Congress failing to block state-level AI regulation in the Big Beautiful Bill Act, states are moving ahead with diverging frameworks that complicate compliance for national employers. Colorado’s law imposes sweeping obligations on high-risk AI use, including mandatory risk assessments, consumer disclosures, and detailed documentation, while Texas opts for lighter rules focused on intent-based discrimination and enforcement. With both laws taking effect in 2026, companies should align now with the NIST or ISO 42001 frameworks to build defensible governance systems and avoid steep penalties, including daily fines and unfair trade practice claims.
Belonging as an engagement strategy
As loneliness and disengagement rise, new research from McLean & Co. highlights belonging as a high-impact lever for retention and performance. Employees who experience genuine connection and feel like a recognized part of the team are nearly six times more likely to be engaged and far more likely to stay. Despite this, only a third of HR leaders have increased investment in belonging efforts, missing a chance to drive growth through recognition, psychological safety, and authentic connection. Start by reviewing where your culture creates friction or silence, then redesign one core process like onboarding, performance reviews, or recognition to build connection and inclusion into the workflow.
Data Point: Giving up
40%
Number of agentic AI projects Gartner expects to be canceled by the end of 2027. The firm cited rising costs, unclear business value, and inadequate risk controls as potential hurdles for the tech.
In Other News
Mark Carney has been dubbed the ‘Trump whisperer’: His ability to shift the dynamic from confrontational to collaborative is a lesson for all leaders. (Fortune)
M&A: How to Factor Trade Policy Impacts Into Deal Pricing. (Deloitte)
4 in 10 new hires say they second-guess their decision during onboarding. (HR Dive)
Coaching in a skills-short, AI-rich era. Plus news from Upwork, Deel and more. (HR Executive)
AI-based salary research fuels inflated expectations, Payscale finds. (HR Dive)
Life with ICE: Downtown SF workers adapt to daily chaos; carry U.S. passports to work. (SF Standard)
Trump Executive Order to Help Open Up 401(k)s to Private Markets. (Wall Street Journal)
Employees work less in the summer. Workplace expert Adam Grant wants HR to get used to it. (HR Brew)