Few companies have embraced artificial intelligence (AI) as fervently as Klarna. Over the past year, the Swedish fintech giant has undertaken a live experiment: an aggressive replacement of a significant portion of its workforce with AI, followed by a realization of the enduring importance of human-centric work. Klarna’s story is a fascinating case study as we all try to absorb the dizzying promises of AI.
The Foray into AI-Driven Automation
In late 2023, Klarna’s CEO, Sebastian Siemiatkowski, made headlines with bold declarations about AI’s potential to revolutionize the workforce. He asserted that AI could perform virtually all tasks handled by humans, leading Klarna to implement AI solutions across various departments. This strategy resulted in measurable cost savings—like $10 million annually in marketing, partly by reducing reliance on human artists in favor of AI-generated images. Klarna’s legal team saw contract generation time shrink from an hour to ten minutes, and an AI-powered chatbot took over the roles of 700 customer service agents, reducing average case resolution times from 11 minutes to under two.
This aggressive adoption of AI led to a workforce reduction from about 5,000 to 3,800 employees, primarily through natural attrition combined with a hiring freeze. Siemiatkowski projected a further decrease to around 2,000 employees as AI continued to take on more functions.
The Epiphany: Human Interaction is Kind of Important
By February 2025, Siemiatkowski publicly acknowledged a pivotal realization. In a post on X, he stated:
“We just had an epiphany: in a world of AI, nothing will be as valuable as humans!
Okay, you can laugh at us for realizing it so late, but we are going to kick off work to allow Klarna to become the best at offering a human to speak to!!!”
He then elaborated further on Klarna’s plans to enhance human customer service, emphasizing that AI-driven cost savings would enable increased investment in human support. (Yes, invest AI cost-savings to improve human-led customer service).
What a shift!
Could it be that Klarna is now coming to terms with the fact that the human touch remains essential for complex, high-value customer interactions? One can only imagine that such a realization came after significant backlash—from customers, employees, and perhaps even investors.
At Scale, AI Lacks Discernment
For anyone who routinely experiments with the many generative AI tools flooding the market, a glaring issue quickly becomes apparent: AI lacks discernment. Whether it’s AI-generated software, content, agent tools, or chatbots, the absence of human judgment becomes painfully obvious the moment tasks become even marginally complex.
At scale—such as in Klarna’s case—this can have serious repercussions: frustrated customers, lost business, legal complications, reputational damage, and more.
Companies adopting AI must prioritize discernment when implementing AI use cases. For now, this likely means limiting AI-automation to a narrow scope of applications.
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Sources:
1- https://x.com/klarnaseb/status/1890336313477361862
2- https://www.nytimes.com/2025/02/02/business/klarna-ceo-ai.html
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