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2025/3/2416:48what'sthefutureofmanagement?DeloitteInsights
Istherestillvalueintheroleof
managers?
Formostorganizations,tevalueisn'tfoundin
eliminatingtberoleorignoringtheneedforchange.There'sathirdpath:reinvention.AndAICanbelp.
ARTICLE.17-MINREAD24MARCH2025
companieswithstrongmanagementreportupto15%higherfnancialperformancethanthosewithweakermanagement,'andevidencesuggestsmanagersmayhave
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moreinuenceonanorganization'sperformancethananyothergroup.Sowhyaresomeorganizationseithereliminatingtherolecompletelyorgreatlyreducingthe
numberofmiddlemanagerroles?
Thisshifttoward"bossless"organizationsislikelybeingdrivenbyarenewedfocus
oneffciency,agility,andworkerempowermentwith"zerodistance"tothe
customer.Economicpressureshaveorganizationslookingtoreducecosts,andarticialintelligenceandothertechnologiesarepoisedtotakeonmany
administrativetasks.Accordingtooneanalysis,Usemployerswereadvertising42%fewermiddlemanagementpositionsattheendof2024thantheydidinthespringof
3
2022.AndresearchbyGartnerpredictsthatthrough2026,20%oforganizationswilluseAItoflattentheirorganizationalstructure,eliminatingmorethanhalfof
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currentmiddlemanagementpositions.
READMOREFROMTHEREPORT
2025GlobalHumancapitalTrends
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Thesechangesbegthequestion:Istherestillvalueinthemanagerrole?
somekeycapabilitiesthatmanagersoftenperformwillalwaysbeneededlike
coachinganddevelopmentoftheirpeople.Today,thepeoplebeingmanagedareinneedofsupportmorethaneverduetotheshrinkinghalf-lifeofskills,theimpactofAI,andtheincreasingpaceofchange.
Andnewcapabilitieswilllikelyneedtobedevelopedinlightofachanginglandscapeintheworldofwork.ThisSugeststhatmanagersmayneedtotakeonnewrolesaswell·Managers,forexample,areuniquelysituatedtoredesignworktocapitalizeonthepromiseofAI,enablechangeandagilityinthefaceofincreasingvolatility,and
makejudgmentcallsanddecisionsclosertothecustomer.Itmightnotbethe
managerwhoperformsthesecapabilities,butformostorganizations,keepingthesecapabilitiesinthemanagerrolemakesthemostsense.
Formostorganizations,eliminatingmanagersaltogetherisn'tthesolution.But
neitherissimplyretainingorelevatingtheroleofthemanagerasithasexistedfor
overacentury.Instead,organizationsshouldseekathirdpath:reinventionoftheroleentirely.Becauseinanageinwhichworkisincreasinglycomplexandvolatile,
people-powered,andmoreAI-augmented,thetraditionalroleofthemanagermaynolongerbeftforpurpose.wemayindeedhavefewermanagersinthefuture,but
whatandhowtheydotheirworkshouldevolveforthenewworldofwork.
AI,alongwithnewsupportstructures,isakeyenablertothisreinvention.NotonlycanAIautomatemuchoftheadministrativeworkthattakesthetimeofmanagerstoday,butitcanalsobecomeapowerfulallyinassistingthemwithfocusingonandleadingwhatmattersmosttoorganizationalresults:
.Developing,coaching,motivating,andnurturingpeople
.Redesigningwork,reallocatingresources,andoptimizinghumanandmachineinteractionstodrivehumanperformanceintheageofAI
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2025/3/2416:48what'sthefutureofmanagement?DeloitteInsights
.Enablingagility,strategicproblem-solving,andinnovation
Thepromiseandperilsofunbossing
Astheroleofthemanagerhascomeunderincreasedscrutinythe"unbossing"trendthat5
involvesthinningoutmiddlemanagementhasemerged.Manyorganizationsarenow
experimentingwitheliminatingmiddlemanagerpositions,eitherasaboldnewoperating
modelbasedonself-organizingteams,orasanexercisefocusedoncostcuttingandreducing
bureaucracy.othersaresignificantlyreducinglayersofmanagementandincreasingtheratio7
ofworkerstosupervisors.Inanidealworld,thismodelgivesemployeesmoreautonomyandcontrolovertheirworkwhileofferingapositivenarrativeforshareholdersthatattening
managementwillleadtogreatereffcienciesandagility.
Forsomeorganizationsthismodelworks.Butmanyorganizationsstrugglewithrealizingthepromiseofit.
Youcancuttheroles,buthumanswillstillleadandbeled,evenwithouttheformaltitles.Thiscancreate"shadowleaders"anduncleardecisionrightsthatslowtheorganizationratherthancreateefficiencies.organizationsthathaveattemptednewformsofunbossingforexample,
holacraciesandselforganizingteams—oftenfoundthatadecentralized,bosslesssystem8
endedupcreatingitsownformofbureaucracyorothercomplications.onefoundational
studyrevealedthatattenedfirmswithfewermiddlemanagerstypicallyexhibitmorecontrolanddecision-makingatthetop—theoppositeofwhatwasintendedtoreducecostsandpushdecisionsdownwardtoimproveagility.
whatisamanager,anyway?
Inmanyorganizations,leadersstruggletoclearlydefnewhatamanagerevenis.
Managersthosewhooverseedirectreportsandactasabridgebetweenexecutivestrategyandfront-lineexecution—arealltoooftenacatch-allroleinthe
organization.Theyareconstantlypressuredtobeprojectsupervisors,changeagents,coaches,administrators,problemsolvers,andmore.Andallofthisontopofdoingtheworkitself.
Nearly40%oftheirtimeiseatenupfrefghtingtoday'sproblemsoronadministrativework(fgure1).
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It'snowonderthatmanagersareoftenoverwhelmed,frustrated,andburnedout—
workerIocaseinpoint:40%ofmanagerssaidtheirmentalhealthdeclinedwhen
neresearchstudysuggeststhattheyrethem.stdepressedandstressedcateg
theytookonamanagerialorleadershiprole.And72%ofworkersinJapandon'tevenwantamanagementposition,whatwasoncethehighlysought-afterpathtowardupwardmobilityhaslostitsappealformanyaroundtheworld.
yetmostmanagersfeeltheirorganizationsaredoingverylittletosupportthem.ourresearchshowsthatorganizationsrecognizetheimportanceofbettersupporting
managersandreinventingtheirrolebutarestrugglingtomakeprogress(figure2).Accordingtoour2025GlobalHumancapitalTrendssurvey(see"Methodology"),36%ofmanagersfelttheywerenotsuffcientlypreparedforthepeople-manager
partsoftheirroleand36%donotbelievetheirorganizationhasimplemented
technologysolutionstohelpthemperformtheseroles.
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Managersneedsupportanddevelopmentespeciallyyoungermanagerswhoearnedpromotionsbasedontheirachievementsasindividualcontributors,butwhohaven'tyetdevelopedthemostimportantskillneededtomeetallthreenewcapabilitiesforthereinventedroleofthemanager:judgment.
Thekeycapabilityneededfortomorrow'smiddlemanagers:Judgment
InanerainwhichthetechnicalandfunctionalworkcanincreasinglybeperformedbyAI,andinwhichworkisincreasinglyfuidandcomplex,themostimportantskillmanagerswilllikelyneedistheartofjudgment—ortheabilitytomakediffcult
decisionswheretherearenocut-and-dryanswersorwhentheinformationavailableisinsuffcient.Judgmentistheabilitytounderstandorganizationalhistory,culture,
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What'sthefutureofmanagement?IDelotteInsights
2025/3/2416:482416:48what'sthefutureofmanagement?DeloitteInsights
uide
andcontextandusehumancapabilitieslikeempathyandimaginationtoguidepabilitieslikeempathyandimaginationtog
discretionandtoimproviseratherthansimplyapplyrules.
Judgmentisn'tsomethingthatcanbelearnedfromatextbookitrequires
experienceandpractice.yetincreasingly,organizationsarefndingitdifficulttosupplythatexperiencetoworkersSotheycandevelopintostrongmanagers.
Judgmentisthefoundationforallthreenewcapabilitiesforthereinventedroleofthemanager(figure3)theabilitytohavetheempathytomaketherightcalls
neededtocoachanincreasinglydiverseworkforce;thecreativityandwisdomto
redesignworkandunlockhumanperformanceintheuncharteredterritoryofanAI-augmentedworld;andtheabilitytoexercisestrategicproblem-solvinginthefaceofuncertainty.
what'stheroleofthemanager?
Traditionally,theroleofthemanagerwastotellworkerswhatneededtobedone,observetheiroutput,andrewardorsanctionworkersaccordingly oftendoingtheworkalongsidetheirteams.
Buttheroleisshifting.Managersareincreasinglybecomingleadersofpeoplewhousejudgmentto:
.Develop,coach,motivate,andnurturepeople.
•Redesignwork,reallocateresources,andoptimizehumanand
machineinteractionstodrivehumanperformanceintheageofAI.
.Enableagility,strategicproblem-solving,andinnovation.
Thisredefnitionincludesboth"player-coaches"thosewhodotheworkalongsidetheirpeopleand"orchestraconductors"wholeadfromthe
front.
Judgment,infact,isthekeyskillneededbymanagerstoresolvetensions(fgure3).Theywillneedtocontinuallybalancethenecessityfororganizationalstabilityandcontrol,whilealsoenablinganddrivingorganizationalagilityandempowerment.
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ir
Likewise,managersareinauniquepositiontospotandrealizethepotentialoftheiruepositiontospotandrealizethepotentialofthe
people,whilealsoworkingtoachievepredictableoutcomesandminimizerisk.
Thethreecriticalcapabilitiesmanagers
needandhoworganizationscansupportandbuildthem
whatarethenewcapabilitiesofthereinventedroleofthemanager,andwhyaretheyimportantintoday'sworldofwork?AndhowdoweuseAIandother
organizationalsupportstructurestobuildthem?
1.Develop,coach,motivate,andnurturepeople
coachinganddevelopmentaresomeofthemostimportantrolesamanagercanplay·our2025researchsuggeststhatamanager'sabilitytolead,inspire,andengagethe
workforceisoneofthelargestinfluencersinmaintainingaproductiveworkforce.
Themosteffectivedevelopmentandmotivationhappenataone-on-onelevel
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betweenmanagersandtheirpeople.otherDeloitteresearchshowsthateffectivelydevelopingyourdirectreportscanboosttheirperformancebyasmuchas27%and
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makethem1.5timesmorelikelytoexceedtheirgoals.Further;,67%ofemployeesinour2025surveysaythattheirmanagerknowsbestwhatmotivatesthem.
consideronelifesciencesorganization,whichconductedanexperimentto
understandtheimpactsofincreasingthespanofcontrolformanagerssupervisingfeldrepresentatives.specically,thisorganizationconductedasmallprojectin
whichitnearlytripledthenumberoffeldrepresentativesforwhichamanagerwasresponsible.Thefndingsofthisexperimentuncoveredthatwhilemanagerswere
abletoabsorbtheincreaseinthenumberofemployeesfromaday-to-dayoperationsperspective,thiscameatthecostofthehumanelementsrequired(e-g.,coaching,
peopledevelopment),resultinginloweremployeeengagementandincreased
turnover.Asaresultofthisexperiment,theorganizationwasabletofndtheoptimalspanofcontrolthatdidnotjeopardizethecriticalrolethatmanagersplayaspeople
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leadersandcoaches.
Inconsultingorganizations,employeeshavelonghad"coaches,"whohelpworkers
growanddevelop,andseparateprojectleaders.Inasimilarvein,Telstra,an
Australiantelecommunicationsandtechnologycompany,splittheroleofthe
managerintotwodistinctroles:leaderofpepleandleaderofwork.Leadersof
peoplefocusonensuringtheirworkershavetheskillsandcapabilitiesneededforthe
businessandhelpthemchartpathstootherpartsofthebusinesstoavoidsilosand
furtherintegration.Leadersofwork,ontheotherhand,don'tdirectlymanagepeopleorcontrolbudgets;they'reresponsibleforleadingprojectteamstoensure
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deliverablesareontimeandonbudget.
Howorganizationscansupportmanagersinbuildingthiscapability
organizationscanuseAItohelpmanagersinthisrole.AICanoffermanagersreal-
timeperformanceinsights,forexample,tohelpthembecomebettercoaches.Insightscanincludedataonworkersentiment;how,when,andwithwhomworkerswork;
howeffectivelyemployeesarecollaborating,andtheoutcomesofworkers'workotnamejustafew.
AtIntel,forexample,managersuseAItohelpguidetheminprovidingdevelopmentopportunitiesandfeedbacktotheirworkers.christypambianchi,Intel'schiefpeopleoffcer,says,"Havingabuilt-in[AI]coachforthemanagercanhelpgivethem
insightsabouttheteamthatthey'remanagingandtheactivitiesthatthey'vetaken
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on."AlthoughAICanhelp,pambianchisuggeststhatAIisn'tareplacementforthe
on."AlthoughAIcanhelp,PambianchisuggeststhatAIisn'tareplacementforthe
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managerrole.sheexplains,"Empathy,support,connectivity,psychologicalsafety,commitmenttotheenterprisethoseareallthinSthatIthinkonlyamanagerandleadercanhelpcreate,andCo-workerscancreateforeachother·
Asworkplacescombinehumanandroboticworkers,AItoolscanalsoenable
managerstobettermeasureindividualperformanceofbothrobotsandhumans,
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analyzetheirerrors,andimproveperformance.Managersinarepairfacilityatoneelectronicscompanyfoundthatmanyemployeesfollowedaregularpatternofhigherproductivityinthemorning,withsubstantialvarianceinafternoonproductivityandincreasederrorratesastheyrushedtomeettheirdailyquotas.Managerscouldnewlyseethisduetotheprecisedataprovidedbytherobots.Asaresult,managerswere
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abletobettercoachtheirworkers,reduceerrors,andimprovetheirperformance.
othertechnologiescanhelptoo.Atonetelecommunicationscompany,managerscandevelopbetterpeopledevelopmentskillsbypracticingdifficultconversationswithanavatarinvirtualreality,withAIanalyzingtheirdatatoactasacoachtorefnetheirskills.'
InadditiontousingAIandothertechnologies,organizationscanalsosupportmanagersinbeingbetterpeoplecoachesanddevelopersby:
·Requiringtraining·deve.pment.andaccreditatinfmanaerialC·achindevelopmentskills.
.creatingopportunitiestopracticeandlearnhowtohavediffcultconversationsandmakechallengingpeopledecisions.
.Assessingmanagerperformanceoncoachinganddevelopment,andtyingmonetaryrewardstotheassessment.
.Acknowledginggreatcoachinganddevelopmentthroughrecognitionprograms(e·g,grantingmoretimeoff,publicrecognition,badges,etc.).
.Buildingacultureofgrowthanddevelopmentfromthetop.
.Helpingmanagerslearnhowtocustomizethewaytheydeveloppeoplebytappingintoindividuals'uniquemotivations,skills,andpassions.
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2.Redesignwork,reallocateresources,andoptimizehumanandmachineinteractionstodrivehuman
performanceintheageofAl
AIistransformingwork,withmoreworkersworkingwithAIthaneverbefore.
studiessuggestthatglobaluseofgenerativeAIhasjumpedfrom55%in2023to
20
75%in2024,andDeloitteresearchrevealsthatmorethaneightin10workers
21
nowinteractwithAIatwork.AsworkersbecomeincreasinglyintertwinedwithAI,managerswillneedtotakeonanewroleofredesigningworkandroles,helpingtheirpeoplebettercollaboratewithsmartmachines,andreallocatingresourcestoperformworkwhetherthatbehumanormachine.
Managersarewellpositionedbeingclosetotheworkbutnottooclosetohelpredesignworkandjobs.Forexample,oneminingcompanyintroducedfully
automated,remotelyoperatedtrainstotransportminerals,retainingdriverstoassistiftheautomationtechnologyfailedandredesigningtheirroles.Althoughtheir
knowledgewascriticaltotheautomationprocess,managersrealizedthatdrivers
sufferedfromlackofroleclarity,autonomy,andstimulatingwork,oftenperforminglow-skillworklikepolishingtrainsandfeelinglessconfdentinrecoveringbroken-
downtrainssincetheynolongerhadopportunitiestodrive.Drivers'roleswere
expandedtoincludemoremeaningfultasks—suchastrainingrecruits—andthey
22
wereallowedtorotatetodifferentportstokeeptheworkvaried.
Als0,considertherolemanagersplayedforoneretailfashionorganizationinhelpingworkerscollaboratebetterwithAItocreatebetteroutcomes.whenAIWas
introducedtohelpfashionbuyersselectwhichstylescustomerswouldwanttowearnextseason,managersnoticedthebuyersoftendidn'tadoptAI'sstrategic
recommendations.ThefashionbuyersfeltthattheAIrecommendationstookawaythecreativeworkofselectingnewstylesthefavoritepartoftheirroles.Instead,
theybecameproftoptimizers,requiredtotestvariouscollectionswithAItoidentifywhichcollectionswouldlikelymakethemostproft.Managershelpedthefashion
buyersmoreeffectivelycollaboratewithAIbyredefningthebuyers'identityas
"visionaries"whostrategizeaboutnewcollections.Asaresult,thebuyers'resistance
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fadedandtrustintheirAICounterpartsincreased.
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Managersalsohaveanimportantroletoplayinhelpingothersdevelophuman
capabilitieslikejudgment,empathy,andimaginationtoworkeffectivelywithAI,aswellasmitigatingtherisksofAI.TheywillalsoneedtoincreasinglyoverseeAI,inadditiontopeople.Inthefuture,managersmayneedtomanagemultipleAIagentsworkingtogetherinanagentecosystem.AtorganizationslikeJPMorganchase,thecompanyisalreadydevelopingautonomousagentsthatperformcomplexmultistep
24
tasks.GeorgeC.Lee,Co-headoftheofficeofappliedinnovationatGoldmansachsandthefrm'sformerchiefinformationoffcer,arguesinhisFastcompanyarticle
cc,,25
thatmanagersneedtodevelopmachinecapitalmanagement.
Howorganizationscansupportmanagersinbuildingthiscapability
Ironically,organizationscanuseAIitselftohelpsupportmanagersintheirnewroleofoptimizingworkforAIandhuma
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