‘Expect more palace intrigue’: HR Leaders react to Sam Altman’s OpenAI departure and return

The leadership drama currently taking place at artificial intelligence pioneer OpenAI has taken both the technology and HR world by storm.

The sudden departure of chief executive Sam Altman over the weekend spoke to a classic boardroom coup, with a lack of transparency causing social media and commentator speculation to move into overdrive.

A statement from OpenAI provided little in the way of tangible insight:

“Mr. Altman’s departure follows a deliberative review process by the board, which concluded that he was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities. The board no longer has confidence in his ability to continue leading OpenAI.”“Mr. Altman’s departure follows a deliberative review process by the board, which concluded that he was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities. The board no longer has confidence in his ability to continue leading OpenAI.”

Former Twitch boss Emmet Shear was installed as interim CEO, who stated on X that “The board did *not* remove Sam over any specific disagreement on safety.”

Employees called for the board’s resignation and the immediate reinstatement of Altman, signed by 505 of the organization’s 700 workforce, speaking volumes as a reaction.

“Your actions have made it obvious that you are incapable of overseeing OpenAI. We are unable to work for or with people that lack competence, judgement and care for our mission and employees”, the letter read, with signatories starting their intention to leave the company if the current board do not.

Employees also took to X en masse to share the same message:

https://twitter.com/miramurati/status/1726542556203483392

Twists and turns, but not unexpected ones

Another tweet, posted early on Wednesday morning by the official OpenAI account confirmed the latest twist in the fast-moving saga and what many suspected – an agreement had been reached for Altman to return to the organization as CEO, along with a new-look board.

Altman himself then tweeted:

https://twitter.com/sama/status/1727207458324848883

UNLEASH canvassed industry opinion on the OpenAI drama and asked in our own social media polls what you believed the next development would be: The majority of respondents correctly predicted the return of Altman as CEO (70% on X and 22% of LinkedIn).

It is perhaps more concerning for business leaders that a significant number of respondents believed OpenAI staff would make good on their threat to walk from the company if Altman wasn’t reinstated (43% on LinkedIn and 20% on X), speaking to both the level of ‘people power’ employees hold and the admiration Altman commands.

“OpenAI employees, like at most startups, are attracted by 'the mission’— and, of course, as this is Silicon Valley, the promise of a big payout,” Josh Bersin, CEO and founder of The Josh Bersin Company, tells UNLEASH.

“As I’ve witnessed in many companies, the founder and leader is always a big part of the story, where (think Steve Jobs and Bill Gates) founders can take on a God-like status to employees.”

By even allowing the possibility of staff to walk out the door, Bersin says the OpenAI board has risked its ‘safe AI’ mission – if not “fatally comprising” it.

Power to the people, especially those who are liked

Roy Baladi, founder and CEO of Jobs for Humanity, tells UNLEASH he was “surprised and distraught” at the news of Altman’s departure from OpenAI. He highlighted that employee dynamics can “go in one to two ways.”

“They can rally and fight back, which they did in a superb way. This does show the leverage employees have collectively if they act as one.”

Baladi says his instinctive reaction was one of uncertainty as to what the OpenAI meant by “not consistently candid in his communications” as outlined in their initial press statement, however he also highlighted that there is “unlikely to be smoke without fire.”

“Firing the founder/CEO especially in such a tactless manner is shocking,” he details. “It draws attention completely away from the cause of the firing and onto the lack of appreciation and respect that ought to be given to the eight years of hard work Sam, Greg, and others put in to bring his idea to life.”

Gary Bolles, AI expert and chair for the Future of Work, Singularity University, adds that the OpenAI drama is another example of Silicon Valley’s penchant for creating a “cult of personality” around charismatic leaders.

As he explains, this encourages “loyal workers” but to who? “Should that loyalty be to the organization, or to the personality?” Bolles questions.

“Management kerfuffles happen all the time in early-stage startups, but they usually don’t merit front-page global headlines. Altman out. Altman to Microsoft. No, Altman back in at OpenAI.

“Expect more palace intrigue before the chaos subsides.”“Expect more palace intrigue before the chaos subsides.”

Bersin also highlights that leadership transition is a common occurrence for technology firms, but one that is “always tricky.” Cisco, IBM and Microsoft are just a few well-known organizations that have experienced similar shifts that were forced to grapple with the “challenges of maintain momentum.”

“In this case I don’t think the board understood this dynamic,” Bersin explains.

“An alarming amount of value has been destroyed in a single weekend. But life, as we know it, will go on. As they say in Jurassic Park: ‘Life finds a way.’”

UNLEASH contacted OpenAI for comment, but the company did not reply in time for publication.