Dealing with enemies translates into predicting how the enemy AI will respond to a situation and using your squad to take advantage of any weakness. Unfortunately for your squad, the AI is pretty good and will use solid tactics against you.
There are times when enemies will blindly rush into your ambush, but many of them will use cover very effectively and wait for you to come to them. Also, the computer AI knows exactly when it can make a shot through objects and at various angles.
Some foes may charge around a corner right into your killing corridor, but many will try to find an angle to hit you without exposing themselves. Also, enemies who know they can’t get to you easily will use grenades to try to flush you out.
The AI may not seem that impressive early on, but as you progress through the game it will be a lot more aggressive, which means you have to take fewer chances with your team. Keep in mind that the AI can act just as effectively as your own squad and don’t make the mistake underestimating it.
However, the AI does provide some breaks and it uses a lot of visible and verbal clues. You can also get a quick peek at the enemies' field of view when you enter Command Mode and view the red visions cone.
This will give you the most obvious intel on where the enemy can detect you. The other clues are not as clear, but when you're attempting to sneak up on the enemy if they hear you they might verbally call out “is someone there?” If you hear those kinds of warnings, stop moving immediately.
As long as they don’t see, you the enemy will eventual declare it a “false alarm” and go back to their usual business. Also, enemies can be forgetful, and if you retreat from combat they will stop looking for your squad. Enemies near a skirmish will join the fight, but you can tell how to respond to the assistance by the verbal clues such as “they're over here" or “I need help.”
You can also see enemies waving each other on. If you pause the action, you should be able to see the red outlines of enemies who are advancing to your position versus the ones that are staying put. Enemies will pursue you to some extent, and you can use this tendency to lure them into a trap.
Retreat
The best of plans don’t always go your way, but it is how you deal with the situation that really matters. If you get into an encounter and your cover or tactics are completely failing, get the heck out of there. Don’t try to power through a really bad spot.
Running away is not cowardly it is tactical and done effectively. This means you don’t run in a straight line that allows your foes a few free shots at your backside. If things get ugly, enter Command Mode and search for a decent spot to run, preferably somewhere with cover.
Depending on the condition of your squad, you might need to use Plan and Go to lay down some suppressive fire from one of your superior mercs. If the situation is a total mess, you might want to just reload from the autosave and try a different attack plan or bail a lot earlier to stem your losses.