Nearform CEO Ciaran Cosgrave looks at the advantages of AI-native teams over traditional pyramid-shaped structures in software engineering.
Two engineers. Six months. A billion-dollar product. That’s what it took Anthropic to build Claude Code from concept to company-wide infrastructure. Not a prototype, or a niche internal tool, but something that, by early 2026, had become mission-critical across the entire organisation.
Claude Code was developed using AI agents to accelerate iteration, enabling a pace of 60 to 100 internal releases per day, with each engineer pushing far beyond typical industry output. By January 2026, nearly all of Anthropic’s code was being written with Claude Code itself. Now this isn’t just about faster development, as Claude Code has become a fundamental model that has been engineered to allow small teams to compress what used to take years into just months.
Welcome to the AI-native engineering team. It looks nothing like what most organisations are building.
The autopsy of the traditional delivery model
The traditional tech consultancy team model was built on a simple idea that more people equals more output, and offshore centres made it possible to grow capacity quickly and cheaply. Junior-heavy teams drove margins, while senior engineers provided oversight and direction. This pyramid-shaped team model grew tall and strong.
But as these large, distributed teams grew, so did the complexity of coordinating them. ‘Agile’ emerged as a response to that friction and it was a genuine improvement on what came before. Sequential waterfall processes inherited from manufacturing and defence in the 1970s were catastrophically misaligned with the realities of software, and agile stepped in with an answer to shorten cycles, embrace iteration and treat working software as the primary measure of progress.
But while it still has its place, agile is designed for a world where humans write every line of code, where in some situations it can carry compromises that have somewhat normalised.
The sprint review feedback problem is the most obvious one. Agile promised tight feedback loops to ensure teams build the right thing, but what can actually happen is that the feedback arrives after two weeks of building. The demo reveals misalignment. Course-correcting mid-sprint is politically difficult and the rework in the next sprint is demoralising. The two-week cycle that was originally designed as a discipline quickly became a ceiling.
And underneath all of it, a structural failure that AI has now made impossible to ignore: most enterprise agile implementations aren’t always agile. The team iterates inside a waterfall container. Budget cycles, governance gates, fixed-scope contracts – the organisation behaves with all the rigidity of sequential planning while carrying the overhead of agile processes. It’s an expensive failure mode because it produces neither the benefits of agile nor the predictability of waterfall – just the cost of both.
And this is where the model starts to break. Coding is only a fraction of end-to-end software delivery, but AI-native systems are radically compressing the human labour required to execute it. The tactical execution, testing, documentation, debugging and scaffolding is increasingly automated (not to mention how we can use AI to help in requirements, prototyping etc).
When 60pc to 80pc of routine engineering effort can be eliminated, headcount scale stops being an advantage. The real bottleneck shifts entirely from the mechanics of writing code to the architecture of system complexity and business intent. Essentially, scale soon stops being an advantage and starts looking like inefficiency.
Large teams introduce coordination overhead. Decision-making slows. Context is lost across layers. What was once a strength – headcount – becomes a drag on delivery. Your pyramid won’t collapse overnight, but it will start to hollow out.
The scarce resource has changed
In 2025, AI systems crossed a remarkable benchmark. SWE-bench Verified, an engineering benchmark for AI models, saw top scores jump from around 60pc in 2024 to nearly 100pc in 2025. In controlled conditions, AI models can now resolve almost any defined software engineering problem.
According to a survey of more than 24,000 developers globally, 85pc now regularly use AI tools for coding and software design. GitHub Copilot crossed 20m users in mid-2025, with paid subscribers growing 75pc year-over-year.
When code generation is abundant and cheap, the scarcity shifts. The new scarce resource is judgement (and finite budget for tokens). The ability to translate a messy, contested business problem into a precise technical specification that an AI can execute reliably becomes much more vital. Security intuition, architectural foresight and the human capacity to know what not to build are all commodities fresh in demand.
By the end of 2026, 75pc of developers will orchestrate rather than code. This is not a distant forecast. It’s already the operating reality for the highest-performing teams.
The engineers who thrive in this environment aren’t trying to out-code AI, but they’re the ones who understand that their primary value is now deciding what to build, doing upfront thinking about the code objectives and specifications, and verifying it was built correctly – not producing the line-by-line code themselves.
What does AI-native truly look like?
An AI-native engineering team reflects this shift in how it is structured and how it operates as it assumes that AI handles execution, while humans handle judgement.
In practice, this leads to smaller, more senior teams. Where a previous delivery model might require eight to 12 engineers, with a handful of junior engineers sprinkled throughout, AI-native teams trend towards three to five experienced engineers augmented by AI systems. The shape of the team changes because the nature of the work has changed.
Roles evolve accordingly. Senior engineers spend less time writing boilerplate and more time defining system constraints, making architectural decisions and reviewing AI-generated output. QA shifts from manually writing test cases to designing strategies that account for AI-generated code patterns, and product managers increasingly prototype directly with AI, collapsing the gap between specification and implementation.
AI may now generate a significant proportion of production code, but in high-performing teams every line still passes through human review. The core engineering skill is no longer generation. It’s validation – getting to know the core processes that will be utilising AI, and making sure it is truly solving the problems and not adding an extra layer of stress.
Even the way performance is measured begins to shift. Traditional metrics such as tickets closed or lines of code written become less meaningful when output can be generated at scale and activity is no longer a proxy for merit, and engineering observability must pivot from tracking developer activity to measuring the cycle time of business value or system stability.
Even newer signals, like token usage, can become traps, rewarding volume over value and encouraging inefficient, costly behaviours at scale. The critical question becomes: how quickly can a team verify that what has been produced is actually accurate, ethical and valuable?
Shipping the future
None of this suggests large teams will vanish overnight. But the structure of opportunity is changing. Junior roles will evolve towards higher-order problem-solving and AI collaboration, and senior engineers will become even more critical as orchestrators of complex human-AI systems. And consultancies will need to move away from labour-heavy models towards outcome-driven delivery.
Businesses should be asking if they’ve redesigned how they deliver software, or just made the old model slightly faster, because ‘slightly faster’ is not the destination. The teams that will define the next decade of software delivery are building something structurally different: smaller, more senior, more focused on judgement than execution, operating with AI agents as genuine team members rather than productivity accessories. And this requires a careful look at not only the technology and tools utilised, but also the human considerations – like training and incentive-setting – and process design.
The two-engineer Claude Code isn’t an anomaly to admire from a distance. It’s a template. The organisations that treat it as such and redesign accordingly will ship the future. The ones that don’t will find themselves outpaced by teams a fraction of their size, wondering when things changed.
Ciaran Cosgrave is the CEO of Nearform. He works in business and IT strategy, innovation, and company culture, specialising in mobile, cloud, business transformation, innovation and strategy.
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